In Letter to President Obama, Brown Joins Group of 22 Senators Urging Energy Department to Take Steps to Protect American Manufacturers and Consumers from Drastic Increase in Natural Gas Prices

Nearly 70 Percent of Domestic Liquefied Natural Gas is Shipped to Countries like China, India, Japan, and South Korea, Potentially Undermining Growth In American Manufacturing, Raising Rates On American Consumers

WASHINGTON, D.C. — With American consumers and businesses depending on affordable and reliable natural gas to power their companies and heat their homes, U.S. Sen. Sherrod Brown (D-OH) today joined a group of 22 Senators calling on President Obama to take steps to ensure the price of domestic natural gas is not impacted by increased exports. With nearly 70 percent of global liquefied natural gas being shipped to Asian counties where natural gas prices are three to four times higher than domestic prices, the growth of American manufacturing and affordable home heating supplies could be drastically impacted if large-scale exports continue to rapidly increase.

 “As our economy continues its recovery and American manufacturing continues its steady growth, natural gas prices must remain stable and affordable to help power our factories and heat our homes,” Brown said. “By exporting large amount of domestic natural gas to countries like China that do not practice fair trade policies, we put our manufacturers, small businesses, and families at risk of paying increased prices.  That is why I am urging the Obama Administration to use more discretion when approving new export facilities, especially with countries that undermine our economic growth.”

As noted in the letter, the Department of Energy recently approved a sixth export facility for liquefied natural gas. With this new approval, the volume of American natural gas exports will exceed domestic use. According to its own study in 2012, if the DOE continues to approve export facilities at this rapid a pace, the domestic price of natural gas could increase by up to 54 percent.  

Since 2008 the American economy has benefited from an increase in the supply of natural gas. American manufacturers have added more than 600,000 jobs, creating a renaissance in domestic production. This increase is fueled by the availability of affordable, reliable supplies. According to a recent study by the Boston Consulting Group, five million additional manufacturing jobs could be created by 2020 if natural gas prices remain near current levels. This growth however could be jeopardized if the price of natural gas is drastically increased due to high export demands.

In February, Brown called on President Obama to use executive authorities, provided by law, to help mitigate the impact in the shortage of propane. The shortage of both natural gas and propane led to increased prices and drastically reduced national inventories. Currently, the national supply of natural gas is 55 percent below the five-year average and at the peak of winter heating season the U.S. Energy Information Association (EIA) stated that national propane reserves bottomed out near their lowest point in more than five years. These types of unforeseen demand place families and small business feeling the sting of high energy bills.

A full text of the letter can be seen below:

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.





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