Biden slams brakes on gas export permits. Now what?

Presented by The American Petroleum Institute (API): Your guide to the political forces shaping the energy transformation

Jan 26, 2024 View in browser   By Rebekah Alvey Presented by A liquefied natural gas tanker and Energy Secretary Jennifer Granholm are pictured. | Michael Dwyer/AP; Francis Chung/POLITICO Facing significant pressure from environmentalists, President Joe Biden took a step to slow the galloping pace of the fossil fuel industry by pausing requests to ship more U.S. natural gas abroad. The decision announced this morning comes at the start of a reelection campaign shaping up as a rematch between Biden’s climate message and former President Donald Trump’s “drill, baby, drill” appeal. Soaring exports of liquefied natural gas from terminals along the Gulf Coast have given the United States powerful leverage against Russian suppliers in Europe and Asia. But natural gas is also a source of heat-trapping methane emissions — and selling more and more of it collides with a U.S. commitment to join other nations in moving away from fossil fuels. During the trickle of news this month suggesting the White House was about to act, climate activists ran into a fossil fuel industry girding for a fight. Senate backers of the oil and gas industry chimed in, writes Kelsey Brugger. And Senate Republican leader Mitch McConnell called a decision to the export-permit freeze a “Green New Deal scheme” aimed at scoring political points. The White House fired back with a statement that seemed designed to appeal to young climate voters, many of whom are in critical swing states like Michigan and Wisconsin — and drew a contrast with Trump. “While MAGA Republicans willfully deny the urgency of the climate crisis, condemning the American people to a dangerous future, my administration will not be complacent,” Biden said. Under the policy change, the Department of Energy will pause decision-making on pending permit requests for LNG shipments while it conducts an open-ended analysis of the impacts on greenhouse gas emissions and energy prices, write Brian Dabbs and Carlos Anchondo. Climate campaigner Bill McKibben, the founder of the climate organization 350.org, has said green groups are already backing Biden. But he said the decision could rally enthusiasm among young voters who were dismayed by earlier Biden decisions — such as the administration’s approval of the Willow oil drilling project in Alaska. Yet the victory for climate activists is limited. The United States is still a massive oil and gas producer. The administration has noted the U.S. will remain the world’s largest LNG exporter, with capacity expected to nearly double by 2030. The decision also won’t immediately affect a massive LNG export project in Louisiana known as CP2, a key target of environmentalists. About 40 percent of U.S. electricity demand is now met by natural gas generation. That means huge volumes of gas produced here stay here. The U.S. gas industry hit another production high in 2023, as it did in 2022. Drilling out of the Marcellus shale basin in Pennsylvania and West Virginia is going gangbusters, as are production out of Oklahoma and the huge oil and gas basin in West Texas. Oil and gas production are two sides of the same coin. The oil cartel led by Saudi Arabia is the world’s dominant oil exporter, but the United States is producing more oil than any single country.   It's Friday — thank you for tuning in to POLITICO's Power Switch. I'm your host, Rebekah Alvey. Power Switch is brought to you by the journalists behind E&E News and POLITICO Energy. Send your tips, comments, questions to ralvey@eenews.net.   YOUR GUIDE TO EMPIRE STATE POLITICS: From the newsroom that doesn’t sleep, POLITICO's New York Playbook is the ultimate guide for power players navigating the intricate landscape of Empire State politics. Stay ahead of the curve with the latest and most important stories from Albany, New York City and around the state, with in-depth, original reporting to stay ahead of policy trends and political developments. Subscribe now to keep up with the daily hustle and bustle of NY politics.      Listen to today’s POLITICO Energy podcast Today in POLITICO Energy’s podcast: Ben Lefebvre breaks down the Biden administration's moratorium on new natural gas export permits.   A message from The American Petroleum Institute (API): America is blessed with abundant oil and natural gas resources - produced to among the highest environmental standards in the world. To maintain America’s energy advantage going forward, policymakers must remove barriers to building American energy infrastructure. Our country should not suffer the consequences of short-sighted policies that ignore energy realities.   Power Centers Climate envoy John Kerry is leaving his high-profile post this spring. | Markus Schreiber/AP Envoy battle ahead A 672-word provision tucked into a defense bill could make it more difficult for President Joe Biden to replace John Kerry when he steps down as special presidential climate envoy, write Sara Schonhardt, Emma Dumain and Timothy Cama. The provision could subject any successor to a politically fraught battle that leaves the position vacant during key global climate negotiations. It requires special presidential envoys at the State Department to get Senate confirmation. Some Democrats worry the uncertainty is enough for the president to demote the role to avoid a confirmation fight. And the concerns aren’t unfounded as Republicans are vowing Kerry’s successor will face a Senate floor vote. Farmer fury goes right Europe’s far-right parties are looking to capitalize on angry farmers and concerns about energy prices ahead of EU-wide elections in June, write Nicholas Vinocur and Bartosz Brzeziński. Farmers across Europe are staging protests over issues like spikes in diesel taxes and the effect of cheap agricultural imports from Ukraine. Earlier this month, farmers in Germany cornered Economy Minister Robert Habeck on a ferry, while others have staged livestock parades to voice their discontent. Farmers may be behind a burst in far-right popularity demonstrated in a recent survey by the European Council on Foreign Relations and POLITICO polling. Coal baron returns Former Massey Energy CEO Don Blankenship is making a bid to represent West Virginia in the Senate, Timothy Cama reports. Blankenship, who ran Massey until shortly after the 2010 Upper Big Branch mine disaster that killed 29 workers, filed Friday to run as a Democrat for the seat being vacated by Sen. Joe Manchin (D), state records show. Blankenship spent almost a year in prison after being convicted of conspiring to violate mine safety and health standards.   A message from The American Petroleum Institute (API):   In Other News A dirty little secret: Washington Post columnist Catherine Rampell writes that Republicans and Democrats have pivoted to political tropes that obscure the nation's extraordinary expansion of energy production of every kind since 2000. Big developments: The largest domestic combined solar and energy-storage project is up and running in California. Located in Kern County, the project has a generating capacity of 875 megawatts from solar and 3,287 megawatt-hours of energy storage. Empty threats: The chief executive of NextEra Energy, a Florida-based utility giant, told financial analysts that he doubts Republicans critical of the clean energy spending in the 2022 Inflation Reduction Act can undo the law. CEO John Ketchum said it would be difficult to scale back the tax credits “no matter what the political winds are.” Houthis hit oil tanker: An oil tanker in the Gulf of Aden is on fire after Houthis rebels said they hit it with a missile, according to the BBC.   A message from The American Petroleum Institute (API): Thanks to recent legislation passed by Congress, America started the conversation on permitting reform. But it will take a lot more to rebuild our nation’s infrastructure for the demands of the future. We need to permanently cut the red tape that is blocking construction, investment, jobs and progress in America. Today, energy infrastructure projects either take too long to permit, or they go the way of the Atlantic Coast and Keystone pipelines and are not permitted at all. This broken process has consequences. For example, the lack of natural gas pipeline approvals is one of the reasons why New England families pay some of the highest wintertime energy bills in America. Put simply - America can't unleash new technologies if it can’t build them. Instead, let’s keep the Lights On.   Subscriber Zone Firefighters assess the scene as a house burns in the Napa wine region of California on Oct. 9, 2017. | AFP via Getty Images A showcase of some of our best subscriber content. Another insurance company is limiting the number of households it’s willing to insure against wildfires in California. Hartford Financial Services Group accounts for less than 1 percent of the state’s homeowner policies, it limits consumers’ options in an already expensive and difficult market. Oil, utility and renewable energy lobbying groups increased their spending by at least 40 percent in 2023 over the previous year, an E&E News analysis found. Spending was focused on permitting reform and Inflation Reduction Act implementation. That's it for today, folks. Thanks for reading, and have a great weekend!   SUBSCRIBE TO CALIFORNIA CLIMATE: Climate change isn’t just about the weather. It's also about how we do business and create new policies, especially in California. So we have something cool for you: A brand-new California Climate newsletter. It's not just climate or science chat, it's your daily cheat sheet to understanding how the legislative landscape around climate change is shaking up industries across the Golden State. Subscribe now to California Climate to keep up with the changes.       Follow us on Twitter Arianna Skibell @ariannaskibell   Follow us

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