The proposals are politically controversial.
Some senior lawmakers, including Sen. Ron WydenRonald (Ron) Lee WydenBiden pushes back at Democrats on taxes Want a clean energy future? Look to the tax code Democrats brace for toughest stretch yet with Biden agenda MORE (D-Ore.), the incoming chairman of the Senate’s Energy Committee, have warned that expanded exports could drive up costs for consumers and manufacturers that have benefited from low costs amid the U.S. gas drilling boom.
Wyden said last month that he wants to examine all natural-gas exports, including ones the administration readily approves to free-trade nations.
Sen. Lisa MurkowskiLisa Ann MurkowskiEmboldened Trump takes aim at GOP foes The Hill's 12:30 Report - Presented by Facebook - DC prepares for Saturday of festivals & Jan. 6 demonstration Republican leaders misjudged Jan. 6 committee MORE (R-Alaska), who serves as the ranking member on Energy and Natural Resources, told The Hill last week that she is working to sway Wyden to favor natural-gas exports.
“He didn’t say it needs to be stopped. He just is taking, I think, a cautionary approach. And knowing Sen. Wyden, I think he will be thoughtful about where he goes with it. I think that is something that, again, as the chairman and ranking, we’ll be talking through, holding hearings and really digging into the issue,” Murkowski said.
Murkowski, an advocate of the exports, applauded the study Wednesday.
“The conclusions in this report on the benefits to the economy should inform the DOE approval process regarding exports,” said Murkowski, the top Republican on the Energy and Natural Resources Committee, in a statement. “This is a really good report and it really does provide guidance as we move forward.”
A number of other lawmakers also have endorsed expanded exports.
Rep. Cory GardnerCory GardnerProtecting the outdoors: Three cheers for America's best idea Ex-Sen. Cory Gardner joins lobbying firm Biden administration reverses Trump changes it says 'undermined' conservation program MORE (R-Colo.), who represents an eastern Colorado district that he said has “seen a tremendous uplift” from natural-gas drilling, said the report’s release should clear roadblocks for exports.
He said with the report out of the way, Congress can apply pressure on the administration to sign off on export permits.
“A number of permits have been waiting because of the report. And so Congress’s role in oversight, and Congress’s directives to the administration to make sure that we go forward with responsible energy development — that can result in responsible exports,” Gardner told The Hill on Wednesday.
Wyden, for his part, highlighted findings showing that some price increases are expected if exports go forward. And he said it’s important for DOE to weigh the specifics of each application.
“Regardless of this study’s conclusions, Senator Wyden will continue calling on the Energy Department to ensure that unfettered natural gas exports don't harm U.S. consumers and manufacturers,” his office said in a statement. “Forecasts and scenarios are worthwhile, but the department has an obligation to consider the impacts of each of the actual applications before it.”
DOE said it would take public comment on the study, and that the report will inform its reviews of 15 export applications.
“Following the closing of the reply comment period, the Department of Energy will begin to act on the 15 applications on a case-by-case basis. The study released today will be one of the inputs considered during evaluation of those applications,” the department said.
While it's bullish on exports overall, the report finds that some manufacturers could be affected, noting “serious competitive impacts are likely to be confined to narrow segments of industry.”
But it nonetheless finds that these energy-thirsty industries as a whole are not projected to undergo a loss in employment or output greater than 1 percent in any year.
The report finds that exports are not likely to affect the overall level of U.S. employment.
“There will be some shifts in the number of workers across industries, with those industries associated with natural gas production and exports attracting workers away from other industries,” it states.
However, while finding net benefits, the study also notes there are winners and losers.
It finds that “impacts will not be positive for all groups in the economy” as prices increase and wage income in industries outside the natural gas sector are affected. “Households with income solely from wages or transfers, in particular, will not participate in these benefits,” the analysts said.
Rep. Edward MarkeyEd MarkeyOvernight Energy & Environment — Presented by Climate Power — Senate Democrats ding Biden energy proposal Six Democrats blast Energy Department's uranium reserve pitch Facebook draws lawmaker scrutiny over Instagram's impact on teens MORE (D-Mass.), a senior Democrat who has criticized export plans, highlighted findings on wage incomes in arguing the report shows that a surge in exports would lead to a “massive wealth transfer from working Americans to oil and gas companies.”
He also questioned the accuracy of the study.
“I am also concerned that the negative impacts on American workers and manufacturing could be vastly underestimated in this analysis because it is based on old data that may understate industrial demand by 30 percent.”
The report drew quick praise from an industry group that’s advocating in favor of increased exports.
The report appears to satisfy the measuring stick DOE uses for decisions on natural-gas export permits, Bill Cooper, president of the Center for Liquefied Natural Gas, told The Hill.
Under the Natural Gas Act, DOE can refuse to honor export applications if it deems them contrary to the public interest. That means exporting natural gas cannot have an adverse effect on the domestic need for that gas.
“This report is evidence that there will not be adverse impacts on the domestic need on the gas that is proposed to be exported. Therefore, the applications are in the public interest and should be granted,” Cooper said.
Overall the report finds little effect on prices in the initial years of exports, but notes a growing impact as years go by and exports grow.
From the report:
U.S. natural gas prices increase when the U.S. exports LNG. But the global market limits how high U.S. natural gas prices can rise under pressure of LNG exports because importers will not purchase U.S. exports if U.S. wellhead price rises above the cost of competing supplies. In particular, the U.S. natural gas price does not become linked to oil prices in any of the cases examined.
Natural gas price changes attributable to LNG exports remain in a relatively narrow range across the entire range of scenarios. Natural gas price increases at the time LNG exports could begin range from zero to $0.33 (2010$/Mcf). The largest price increases that would be observed after 5 more years of potentially growing exports could range from $0.22 to $1.11 (2010$/Mcf). The higher end of the range is reached only under conditions of ample U.S. supplies and low domestic natural gas prices, with smaller price increases when U.S. supplies are more costly and domestic prices higher.
— This story was updated at 3:17 p.m., 3:56 p.m. and 4:46 p.m.