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DOE has published its responses to its report, "Life Cycle
Greenhouse Gas Perspective on Exporting Liquefied Natural Gas from
the United States: 2019 Update," published in draft form in
September.
DOE periodically updates this report, which was first produced
in 2014, in order to review the impact of new applications seeking
authorization to export LNG to non-free trade agreement (FTA)
countries. The agency received seven comment letters for about its
2019 report.
In the 2019 draft report, DOE asked two main questions:
How does domestically produced LNG exported from the United
States compare with regional coal used for electric power
generation in Europe and Asia, from a life cycle GHG
perspective?
How do those results compare with natural gas sourced from
Russia and delivered via pipeline to the same European and Asian
markets?
The report found that "use of U.S. LNG exports to produce
electricity in European and Asian markets will not increase GHG
emissions on a life cycle perspective, when compared to regional
coal extraction and consumption for power production," and "the use
of imported coal in these countries would only increase coal's GHG
profile." (See graphs below for Europe and Asia.)
DOE noted in the report and the Federal Register notice that it
is not required to consider whether LNG would be displacing any
electricity from renewable sources or nuclear energy, either of
which would have a lower GHG profile than natural gas/LNG
power.
Figure 1: Life Cycle GHG Emissions for Natural Gas and Coal
Power in Europe.
Figure 2: Life Cycle GHG Emissions for Natural Gas and Coal
Power in Asia.
Comments and responses
In its comments, DOE first stated that it received widespread
support for the study design and assumptions from groups such as
the American Petroleum Institute, LNG Allies and the Center for
LNG.
But the Sierra Club again raised the issue of displacement of
renewable power, and DOE again dismissed the matter by saying that
"coal-fired power… is currently the most likely alternative to
natural gas-fired power for baseload generation." DOE also said
that the complexity of renewables is beyond the scope of the review
because different countries' policies to support renewables "are
speculative…"
The Center for LNG added in its comments that natural gas and
renewables are complementary, not competitive. It submitted a study
that found that for each 1% increase in gas-fired generation, the
amount of renewable generation increases by a nearly equal amount
of 0.88%. DOE said that it agrees that natural gas "is one part of
an environmentally-preferable global energy portfolio."
Sierra Club also said that non-FTA LNG exports will raise the
cost of domestic natural gas and encourage gas-to-coal switching,
thus raising US emissions. But DOE pointed to current and projected
US natural gas prices as "historically low," and said that its 2018
study found that LNG exports will have only a marginal effect on
natural gas prices. Furthermore, DOE forecasts that US coal
consumption will continue to decline through 2050.
While siding with pro-LNG commenters on most issues, DOE said
that it's sticking with its new, higher number for the global
warming potential (GWP) of methane emissions on a 100-year scale of
36, which has become the new international standard. The Center for
LNG pushed for retaining the number from prior DOE studies of
28.
Also on the methane angle, the Sierra Club said that DOE's
assumption of a 0.7% leakage rate of methane from oil and gas
production and transmission is far too low; Sierra Club said that
1.24%, as found by a recent National Energy Technology Laboratory
review, should be used. But DOE said that other recent NETL studies
have found a range of 0.7% to 0.88%, and that there is high
variability among all studies of methane emissions.
Finally, DOE dismissed several criticisms of methodology by the
International Energy Consumers Association (IECA), which opposes
additional LNG exports. DOE said that IECA's is incorrect in
claiming that the methodology is flawed because it lacks methane
emissions from inside-the-fence operations, such as onsite gas
refrigeration, in the receiving nation. Those forms of emissions
and energy use are in the model, according to DOE.
