Policy: Environment & Energy

Energy Secretary Ernest Moniz: Geopolitical concerns will matter in natural gas exports

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Energy Secretary Ernest Moniz said the political crisis in Ukraine may factor into Energy Department decisions on whether to approve natural gas export projects.

Geopolitical concerns, such as the one underscored by Russia's use of energy supplies to influence relations with its European neighbors, are one of several considerations the department makes when evaluating export proposals, Moniz said Friday.

"Maybe we will give some additional weight to the geopolitical criterion going forward,” Moniz said at a Washington event, according to Bloomberg. “But we will never eliminate for sure the issue of implications for the domestic market.”

Republicans and some Democrats have advocated expediting DOE reviews of applications to export natural gas to nations that lack a free-trade agreement with the United States. The department must determine those projects to be in the public interest, which invites a higher level of scrutiny.

Lawmakers on both sides of the aisle have pushed legislation to smooth a path for exports in light of the situation in Ukraine, which relies on Russia for a majority of its natural gas. They have criticized the pace of Energy Department approvals — it has given the green light to six projects, with 24 pending.

Moniz said the DOE was monitoring energy flows in Europe and that supplies had not been interrupted. Still, he said the relationship with Russia was "under strain."

Even if the DOE did approve exports more quickly, shipments wouldn't be ready to leave the U.S. for years, as just one export terminal is slated for completion before 2017. Also, Ukraine doesn't have an import terminal to take U.S. shipments, and it would likely opt for cheaper, piped gas.

Moniz's caveat that domestic considerations would continue to play a role highlights concerns from Democrats who oppose expanding exports.

Some Democrats argue that sending more natural gas abroad would raise domestic prices, undercutting a competitive advantage for manufacturers.

A 2012 DOE-commissioned study by NERA Economic Consulting said exports would raise prices marginally, but that exports overall would benefit the economy.

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