Exporting gas means higher monthly energy bills for American families
Everything costs more these days, but few commodities are spiking in price more than “natural” gas. Almost half the country uses gas to heat their homes — and could be seeing a 30 percent jump in their monthly bills this winter. In a country where one in three households struggled to pay their energy bills before the COVID-19 pandemic, this is a mounting economic crisis that falls most heavily on those that can least afford it — particularly communities of color who are more likely to spend a higher portion of their income on energy.
In trying to place blame for the higher prices, politicians have fallen back on familiar rhetoric. Republicans claim President Joe Biden’s environmental policies are limiting the supply of gas, despite the fact that the Biden administration continues to lease out public land to the oil and gas industry. Meanwhile, Democrats have called for investigations into price gouging, pointing to higher profits flowing to the oil and gas industry while the American public suffers.
Amid all the noise, both sides are missing the primary driver of higher home heating costs: We’re exporting more gas overseas, which means less supply and higher prices in the United States. According to the Institute for Energy Economics and Financial Analysis, the fossil fuel industry now exports almost 20 percent of its gas — something that wasn’t true even a few years ago.
This increase is primarily due to the build-out of liquified gas terminals on the Gulf Coast, as the oil and gas industry apparently aimed to take advantage of higher prices for gas overseas and make foreign countries dependent on their product instead of clean energy like wind and solar. Gas has continued to flow through those facilities at record rates even as American families stare down rapidly escalating home heating costs heading into winter.
That oil and gas executives are making immense profits on exports while driving up U.S. home heating costs is particularly galling for Gulf Coast communities near these facilities, who live with the elevated risks of deadly explosions, chemical leaks and air pollution. What’s worse is that these communities could see many more of these facilities in the coming years without action from the Biden administration. The industry plans to build more than 20 additional gas export terminals in the coming years, each of them adding to pollution levels in a region that is being treated as a sacrifice zone for the fossil fuel industry.
Exports’ role in higher prices has gotten the attention of senators with a wide divergence of views on fossil fuels broadly, from Joe Manchin (D-W.Va.) to Angus King (I-Maine) to Elizabeth Warren (D-Mass.).
“Are we exporting more at the detriment of the U.S. consumer, that we’re going to pay a higher price here so that companies we allow to export their products can make a higher profit overseas?” Manchin asked at a Nov. 16 Senate hearing.
What can be done to reduce the economic pain to American families this winter? In the short term, federal, state and local governments need to work urgently to connect people with existing benefits like the Weatherization Assistance Program, which helps low-income people reduce their energy needs through energy efficient home improvement projects, as well as the Low-Income Home Energy Assistance Program that helps cover energy costs for people who are behind on their energy bills. The recently passed bipartisan infrastructure bill included additional funding for both these vital programs.
Biden’s Department of Energy should also use its authority and limit gas exports to help stabilize prices for U.S. consumers, while saying “No” to the industry’s rush to build new facilities that make Americans’ home heating costs more dependent on a volatile international commodity like gas.
But this emerging energy crisis begs bigger questions about our relationship with fossil fuels, particularly fracked gas. Producing clean electricity with wind and solar is more affordable than fossil fuels right now, and the wind and the sun have the inherent benefit of having zero fuel costs forever. For Americans that heat their homes with increasingly clean electricity, that means predictable energy bills while those that are dependent on gas continue to be at the mercy of the kinds of sudden price spikes we’re seeing now.
Allowing the oil and gas industry to continue to sell American gas to the highest bidder puts us at risk — of higher energy costs nationwide, increased pollution in frontline communities and ever-worsening extreme weather. It’s time to rapidly scale up clean energy solutions so that our monthly energy bills are no longer dependent on their dirty product.
Dave Cortez is director of the Lone Star (Texas) Chapter of the Sierra Club.