This story was first published on Politico Pro on January 8th.

The Biden administration is initiating a reassessment that may slow down the rapidly expanding U.S. natural gas export industry. This action poses a potential conflict between the president’s environmental goals and his foreign policy priorities.

The results of the assessment could have significant consequences for the fossil fuel sector, the United States’ influence as an energy leader, and the trustworthiness of President Joe Biden’s environmental promises. It could also impact his chances of winning the upcoming November election.

According to two anonymous sources familiar with the matter, the Department of Energy is conducting a review to determine if climate change should be considered by regulators in their evaluation of a proposed gas export project’s alignment with the national interest. This review has not yet been publicly acknowledged.

In the last ten years, gas exports from the United States have increased by four times due to a rise in production. This has resulted in the U.S. becoming the top exporter of natural gas globally and aiding Europe in replacing Russian imports after the invasion of Ukraine. However, President Biden is also facing mounting pressure from environmental organizations to fulfill his promise of shifting away from non-renewable energy sources, which was also a commitment made by the U.S. at the recent climate summit in Dubai.

Environmental organizations welcomed the prospect of impeding or stopping the increase in exports, while those concerned with national security cautioned against interfering with a trade they believe benefits America’s geopolitical goals. This development coincides with the Energy Department’s consideration of granting a permit for the CP2 gas export facility in Louisiana, which has been criticized by activists for its potential impact on carbon emissions.

Roishetta Ozane, the founder of environmental group Vessel Project of Louisiana, welcomed the news that the Biden administration may be rethinking how it determines whether a proposed project is in the public interest. Ozane is among a group of green activists planning to protest next month at the Energy Department headquarters to pressure the administration to change how it evaluates export proposals.

“We strongly urge the DOE to halt issuance of any new permits for the industry, as we recognize the importance of the Biden administration securing a victory in addressing climate change. My hometown of Sulphur, La., located within a one-hour drive of three LNG plants, is directly affected by such decisions. In order to attain success in the upcoming 2024 election, political leaders must be willing to make courageous and progressive decisions.”

A senior administration official informed POLITICO that the Department of Energy, in charge of granting export permits, will review its evaluation of the potential climate effects, national security considerations, and domestic economic repercussions of proposed projects.

According to sources knowledgeable about the evaluation procedure, discussions involved several individuals including Energy Secretary Jennifer Granholm, Deputy Energy Secretary David Turk, Brad Crabtree who serves as assistant secretary for DOE’s Office of Fossil Energy and Carbon Management, White House clean energy adviser John Podesta, and National Climate Adviser Ali Zaidi.

The Energy Department must decide what factors to consider when making a decision on whether or not to approve a permit for exporting liquefied natural gas. An anonymous official from the administration stated that this reevaluation is necessary due to the increased understanding of LNG’s methane emissions, economic effects, and impact on national security over the past ten years. Regulators are also addressing shortcomings in how they previously assessed the potential risks of these export projects.

The Energy Department declined to answer several email inquiries. In the past eight years, the department has ordered three investigations into the consequences of exporting gas. However, all of these studies primarily addressed the financial aspects of the trade and did not address its potential impact on the environment.

However, the recent evaluation may cause concern for administration members who are worried about potential threats to national security. Limiting the expansion of exports could potentially hinder the United States’ ability to assist Ukraine in defending against the ongoing Russian invasion, according to another source familiar with the administration’s review.

According to an unnamed source, the State Department has expressed concerns about a plan that has yet to be released. They believe that any actions that could potentially decrease U.S. natural gas exports may also hinder U.S. diplomacy efforts.

The source stated that any limitations on increasing export capacity would be a significant foreign policy disadvantage for the White House. They also mentioned that any measures resembling a cap on liquefied natural gas may not be approved by Biden due to the ongoing conflict in Ukraine.

The State Department representative declined to provide a statement. However, experts in national security were prompt to mention that the White House may have struggled to maintain solidarity among European countries in backing Ukraine if it weren’t for gas exports, as Russian gas deliveries to the area dwindled in 2022.

According to Joseph Majkut, the director of the energy security and climate change program at the Center for Strategic and International Studies think tank, it is widely accepted that the U.S. LNG industry played a significant role in aiding Europe’s transition away from Russian gas following the invasion of Ukraine. This also helped to uphold European unity, while in Northeast Asia, it has been a crucial part of energy security planning.

The long-standing Natural Gas Act, in place for several decades, mandates that the Energy Department evaluate the potential public benefits before granting authorization for exporting natural gas to countries without a free trade agreement with the United States. This export permit is crucial for prospective exporters, as it requires them to secure significant funding in order to construct the necessary infrastructure, such as pipelines and compressors, to transport gas to the coast and cool it to -259 degrees Fahrenheit for transformation into a liquid state for shipping.

However, some critics argue that the Department of Energy (DOE) has simply been giving automatic approval to export requests. Despite starting to approve export permits in 2012, the department has never denied an applicant based on the “public interest” criteria. This has allowed the U.S. gas export industry to rapidly expand, reaching approximately 20% of domestic gas production by late 2023. Currently, there are seven active export plants in the country and eight more have been approved but are still in the construction phase, according to government records.

Charlie Riedl, the leader of the trade association for Liquefied Natural Gas, expressed concern that any delays in approving new projects could discourage potential customers in friendly nations like Japan and South Korea. He also pointed out that the Department of Energy’s past evaluations have consistently shown that natural gas exports are beneficial to the general public.

“According to Riedl, the outcome of every study conducted on the matter consistently concludes that exporting natural gas is in the best interest of the public. Even if another study were to be conducted, Riedl anticipates the same outcome would be reached.”

The leaders of the LNG industry promote gas as a solution for other nations to decrease their reliance on coal for energy production. They believe that there is a sufficient amount of gas in states like Pennsylvania and Texas to meet the demands of both international and domestic markets.

The Democratic party has been urging the Biden administration for several months to take into account the impact on greenhouse gas emissions of exporting large quantities of natural gas. Senator (name) has also raised this concern.Jeff Merkley

Last year, in a letter, (D-Ore.) asked Granholm to review the DOE’s process for determining if a project is beneficial to the public.

Democratic Minnesota Sen. Tina Smith

It was deemed an error to disregard the environmental impact of the LNG industry.

According to scientific principles, it is important to consider the risks, rewards, costs, and benefits when making decisions. Neglecting these costs is not a wise decision.

However, Republicans were swift to emphasize the significance of the liquefied natural gas (LNG) deliveries for national security. Senator.Kevin Cramer

Senator from North Dakota, a significant producer of natural gas, expressed concern about the timing of the administration’s review.

Cramer stated in an interview that the ongoing conflict in Ukraine has been utilizing natural gas as a means of warfare against Europe. He also mentioned that the Biden administration is aware of the concerns and actions of the environmental movement, but believes they should prioritize resolving the current situation before addressing these issues.

The environmental movement has aimed to use Venture Global’s CP2 project as a measure of Biden’s commitment to green policies. The proposed facility would export approximately 24 million metric tons of gas from a 546-acre location in Cameron Parish, Louisiana.

The export terminal is currently waiting for a decision from the Federal Energy Regulatory Commission. The commission must approve the construction of interstate pipelines and LNG facilities after evaluating their environmental impact and determining their necessity in the market. The project has experienced multiple setbacks at the energy regulatory agency due to insufficient data provided for the environmental review.

According to Shaylyn Hynes, spokesperson for Venture Global, American LNG is our most powerful tool for rapidly replacing the use of coal worldwide and fighting against climate change.

This report was co-authored by Catherine Morehouse and Josh Siegel.