On Wednesday, the European Commission, the executive branch of the European Union, unveiled its Affordable Energy Action Plan, a list of actions ostensibly aimed at securing affordable and clean energy for European citizens. But the plan includes a measure focused on funding international liquefied natural gas exports, which has been criticized as a win for Big Oil companies in the United States and for lacking business sense.
The plan calls for the European Union to back export infrastructure for liquefied natural gas (LNG)—which may have a worse carbon footprint than coal—and long-term LNG contracts to secure "a better deal for imported natural gas."
While the document does not directly single out U.S. LNG export projects, during a press conference on Wednesday centered on the Affordable Energy Action Plan, Dan Jørgensen, European Commissioner for Energy and Housing, said that the European Union has "been dependent on LNG from the U.S. and we will continue to be so in the future" when asked about reliable sources of LNG.
This "would mark a major change in the bloc's energy policies, strengthening the continent's links to the carbon-intensive liquefied natural gas it eventually wants to phase out," according to Politico, which reported on this provision of the plan before the full plan was released.
The business case for the LNG proposal would be "disastrous," wrote a spokesperson for the environmental group Friends of the Earth US in a statement Wednesday, adding that "the Action Plan is music to the ears of Trump's Big Oil buddies."
When it comes to LNG, the plan notes that the Commission will "explore options going beyond demand aggregation and will look into other approaches (e.g. the Japanese model)."
For the past five decades, Japan has been the world's biggest buyer of LNG, directly purchasing stakes in overseas LNG ventures in order to secure access to gas at "preferential prices," perPolitico. Using this approach, Japan has become the largest public backer of American LNG projects.
However, as demand for natural gas has fallen in Japan, Japanese utilities—once purely buyers of LNG—are increasingly selling the product abroad, according to the Institute for Energy Economics and Financial Analysis.
This trajectory makes the "Japanese model" more of a "cautionary tale" as opposed to something that the European Commission ought to pursue, wrote to Seb Kennedy, an energy journalist and market analyst.
"The E.U.'s proposed foray into foreign LNG investments appears to be a high-stakes gamble fraught with pitfalls. By risking public funds on ventures that have already demonstrated turbulent market behavior, Europe may be setting the stage for future financial misadventures," Kennedy wrote on Monday.
Meanwhile, Politico also reported that U.S. President Trump—who made restarting reviews of applications for approvals of liquified LNG projects one of his first official moves in office—is "pressing the EU to buy more American LNG, threatening to impose severe tariffs if the bloc doesn't meet that and other demands."
In her response to the European Commission's Action Plan, Laurie van der Burg, global public finance program manager at Oil Change International, a group that fights for a fossil fuel-free world, said that the proposal constitutes "bowing to pressure from the Trump administration and lining the pockets of the fossil fuel industry."
Climate and consumer groups argue U.S. LNG exports are harming public health, devastating the environment, and raising prices for working families.
"In my community, LNG has brought more than just terminals and pipelines; it has ushered in a wave of health crises, environmental degradation, and economic disparities," said Roishetta Ozane, founder of Vessel Project of Louisiana and co-director of Gulf Fossil Finance Hub, in a statement on Wednesday tied to the release of the Affordable Energy Action Plan.
"Our water is contaminated and we're forced to purchase water in plastic bottles. All while the promise of jobs feels hollow against the backdrop of our poisoned land," Ozane wrote. "We deserve better than to be collateral damage in the pursuit of energy profits. Enough is enough."
