3 Center for American Progress | Testimony on “Trade Implication of U.S. Energy Policy and the Export of Liquefied Natural Gas (LNG)”
Large LNG exports possible by 2020, leading to a natural gas price hike
Beore Congress passes legislaion o accelerae or eliminae he public ineres review process, i is essenial o noe ha DOE has already approved LNG erminals ha could expor 13 billion cubic ee per day, or Bc/d, o naural gasabou 18 percen o oal domesic producion projeced in 2020.
Te Energy Inormaion Adminisraion, or EIA, noes ha LNG expors will increase by 14-old beween 2013 and 2020 under a “business as usual” scenario.
Tere would be anoher ourold increase in expors beween 2020 and 2030.
Under hese projecions, he cos o naural gas or domesic elecriciy generaion would rise by 32 percen beween 2013 and 2020, according o EIA.
And he price would nearly double beween 2013 and 2030.
EIA also ound ha naural gas expors will increase gas prices.
Increased naural gas expors lead o increased naural gas prices. Larger expor levels lead o larger domesic price increases, while rapid increases in expor levels lead o large iniial price increases ha moderae somewha in a ew years. Slower increases in expor levels lead o more gradual price increases bu evenually produce higher aver-age prices during he decade beween 2025 and 2035.
A price increase could have severe impacs on amily budges. EIA repors ha he ypical household spen an average o nearly $2,000or 2.7 percen o heir house-hold incomeon household energy uels in 2012.
Te households in he lowes ﬁfh income bracke spen more han wice his porion6 percenon household uels.
Higher natural gas prices could hurt manufacturing
Lower naural gas prices have ueled he recen increase in U.S. manuacuring. “Fuel Fix,”
a Hears energy publicaion, repored in March ha:
An ample supply o cheap naural gas has ignied a U.S. manuacuring surge projeced o expand plan payrolls and drive demand or chemicals, machinery and seel hrough he end o he decade, according o a repor released Tursday.Sinking naural gas prices … are linked o more han 196,000 new manuacuring jobs in major meropolian areas and a $124 billion boos o sales or energy-inensive producs like abricaed meals and plasics, according o a U.S. Conerence o Mayors repor on he naion’s indusrial growh.