Senators Stabenow and Markey Lead Bipartisan Group of 22 Senators Urging President Obama to Consider the Impact of Large-Scale Natural Gas Exports on American Manufacturing, Families

Friday, May 09, 2014

U.S. Senator Debbie Stabenow (D-Mich.), a senior member of the U.S. Senate Energy Committee and co-chair of the bipartisan Senate Manufacturing Caucus, and Senator Edward Markey (D-Mass.), a member of the Commerce, Environment, and Foreign Relations Committees, along with an additional 20 Senators, today urged President Obama to consider the impacts on American manufacturing and families that rely on natural gas for heat when looking to approve new natural gas export facilities.

In a letter to the president, Sens. Stabenow, Markey and their colleagues pointed out that families saw skyrocketing energy bills this winter in some parts of the country faced with short supplies of natural gas and propane, shortages that could be exacerbated with increased exports. They also pointed to the hundreds of thousands of American manufacturing jobs created in the last few years, in part because of low natural gas prices. Aggressive, unlimited new exports of natural gas could raise prices for families and American manufacturers.

The letter reads in part: "Families and businesses depend on affordable and reliable supplies of natural gas. This winter many parts of the country faced tight supplies of propane and natural gas and families were left to face high energy bills.... Taking a longer-term view, the United States has benefited from rising supplies and lower prices for natural gas since 2008. Thanks in part to lower natural gas prices, America's manufacturing sector has created more than 600,000 jobs since 2010. The Boston Consulting Group concluded that affordable natural gas prices could lead to 5 million more manufacturing jobs by the end of the decade. We must ensure that we do not squander what is clearly an American competitive advantage right now for American manufacturers and for the American economy."

The letter is signed by Sens. Tammy Baldwin (D-WI), Richard Blumenthal (D-CT), Cory Booker (D-NJ), Barbara Boxer (D-CA), Sherrod Brown (D-OH), Susan Collins (R-ME), Dick Durbin (D-IL), Dianne Feinstein (D-CA), Al Franken (D-MN), Tom Harkin (D-IA), Angus King (I-ME), Patrick Leahy (D-VT), Carl Levin (D-MI), Joe Manchin (D-WV), Edward Markey (D-MA), Bill Nelson (D-FL), Jack Reed (D-RI), Jeanne Shaheen (D-NH), Debbie Stabenow (D-MI), Elizabeth Warren (D-MA), Sheldon Whitehouse (D-RI), and Ron Wyden (D-OR).

The full text of the letter follows:

May 8, 2014

President Barack Obama
The White House
1600 Pennsylvania Avenue NW
Washington DC 20500

Dear Mr. President:

We write to express our concern regarding the impact that large-scale exports of natural gas could have on American consumers and businesses.

Families and businesses depend on affordable and reliable supplies of natural gas. This winter many parts of the country faced tight supplies of propane and natural gas and families were left to face high energy bills. During February, Henry Hub natural gas prices more than doubled to over $8 per million British thermal units and prices in some regions of the country were far higher. Our natural gas inventories are now 55 percent below the five-year average. This winter served as a reminder that high natural gas prices can hurt family budgets and be a drag on our economy.

Taking a longer-term view, the United States has benefited from rising supplies and lower prices for natural gas since 2008. Thanks in part to lower natural gas prices, America's manufacturing sector has created more than 600,000 jobs since 2010. The Boston Consulting Group concluded that affordable natural gas prices could lead to 5 million more manufacturing jobs by the end of the decade. We must ensure that we do not squander what is clearly an American competitive advantage right now for American manufacturers and for the American economy.

Recently, the Department of Energy approved exports of liquefied natural gas from a sixth export facility. This means that total approved exports, combined with existing and approved export pipelines, now exceeds the total amount of gas that is currently used in every single American home and commercial business. This level of exports well exceeds the "high export scenario" referenced by a Department of Energy study in 2012 that indicated prices could increase by up to 54 percent. Price increases of this scale could translate into more than $60 billion a year in higher energy costs for American consumers and businesses.

Liquefied natural gas shipments to China, India, Japan, South Korea, and other Asian nations account for about 70 percent of the global trade of liquefied natural gas. Based on the contracts U.S. exporters already have in place, Asia would likely be the primary destination of U.S. natural gas exports as well. Natural gas prices in Asia are currently three to four times higher than those in the United States. Integration of U.S. and Asian natural gas markets through U.S. exports could lead to further increases in prices for American consumers and businesses, which may fundamentally reverse many of the economic benefits that have led to the current surge in manufacturing job growth in the United States. Large-scale exports of natural gas to Asia could also jeopardize America's goal of achieving energy independence, a goal made more achievable by the recent increase in domestic gas production.

It is imperative, both for American jobs and for the environment, that the Department of Energy continue to consider the public interest and the cumulative impact of potential exports on U.S. consumers and businesses before granting approval of natural gas exports to countries with which the United States does not have a free trade agreement. We ask that you pay close attention to the effects that large-scale natural gas exports could have on businesses, workers, and residential consumers.

Thank you for your attention to this matter.


Sincerely,