What Would More Natural Gas Exports Mean To You?
The Department of Energy will soon decide whether to allow more liquefied natural gas exports. The gas industry argues more exports are good for the U.S. economy. But manufacturers want cheap gas to stay at home and power factories. Environmentalists worry exports will increase drilling across the country even more.
RENEE MONTAGNE, HOST:
And after dedicating a chunk of his inaugural address to climate change, there was a lot of speculation about how President Obama would introduce the issue in his State of the Union speech last night. He came on strong, urging Congress to come up with bipartisan solutions. If not, the president said, quote, "I will."
He also talked about energy and pledged to cut red tape to make domestic drilling easier.
PRESIDENT BARACK OBAMA: We produce more natural gas than ever before, and nearly everyone's energy bill is lower because of it.
MONTAGNE: Plus, all that domestic natural gas means the U.S. could see a dramatic rise in the amount of natural gas the U.S. exports. NPR's Jeff Brady took out some old bills of his own to consider what that might mean for future utility bills.
JEFF BRADY, BYLINE: I'm looking at a copy of my utility bill from last month. It was cold here in Philadelphia and heating our house with natural gas cost $182. In 2006, the same bill would have been $420 - more than twice as much. Part of the reason our cost is down - and much of the rest of the country is paying less for gas now - is supply. The country's natural reserves are much higher now than just a few years ago.
The U.S. Department of Energy is considering whether it's in the public interest to let companies export more of that natural gas, specifically to countries that don't have free trade agreements with the U.S.
Sean Dixon is with the environmental group Clean Ocean Action and he says that would have consequences.
SEAN DIXON: Everyone is going to see a higher price point on their energy here, no matter what they use natural gas for because the natural gas costs and the prices will go up.
BRADY: The industry disputes this, saying more exports will lead to even more domestic production. But Dixon likes that even less.
DIXON: When you have this incentive to send natural gas overseas, you're going to have the incentive there to produce more fracked natural gas.
BRADY: Hydraulic fracturing, or fracking, is one of the technologies that has led to all the new gas reserves in the U.S. But many worry that it's polluting drinking water and turning rural landscapes into industrial zones.
Companies like Cheniere Energy, based in Houston want to export U.S. gas all over world to countries like Spain, Japan and Korea. One of Cheniere's applications has been approved, the other is pending.
CEO Charif Souki says more drilling in the U.S. would be a good thing.
CHARIF SOUKI: You go and ask the good people of North Dakota who have jobs and very high paying jobs whether they object to drilling in the United States, and I don't think you'll find too many people objecting.
BRADY: Souki argues there's plenty of natural gas in the U.S. to both keep prices reasonable and to increase exports. Ultimately, he argues, it will benefit gas customers.
SOUKI: It's going to lead to a more stable market because we are now in a crazy situation that we have so much gas that we cannot create markets for it.
BRADY: But exporters face powerful opponents - American manufacturing and chemical companies. They see a lot of opportunity to use this cheap supply of natural gas here at home.
Kevin Kolevar is vice president of government affairs and public policy at Dow Chemical.
KEVIN KOLEVAR: For example, Dow has announced $4 billion in new investment in new infrastructure in the Gulf Coast.
BRADY: Dow and other companies plan to build new plants that could employ thousands of workers. But if gas exports increase and the wild price swings come back, Kolevar that will change.
KOLEVAR: You're going to see those projects pulled off the table. Worst case scenario - you'd see those projects put on the table in other countries around the world because there's greater price stability there.
BRADY: Dow and other big companies want the Department of Energy to slowly increase gas exports. Decisions on 15 applications before the agency could come within weeks.
Jeff Brady, NPR News. Transcript provided by NPR, Copyright NPR.