The Market and Climate Implications of U.S. LNG Exports
From 2015 to 2023, the United States transformed from a net importer of natural gas to the world's largest liquified natural gas (LNG) exporter. We find that this surge in LNG exports has reconnected U.S. gas prices to world market prices, after a hiatus of “shut-in” fracked gas. We estimate that the domestic gas price effect of this recoupling is comparable to a $30/ton carbon tax. For coal prices, which are coupled to gas through competition in the power sector, this effect is comparable to a $20/ton carbon tax. Using the NREL ReEDS model, we estimate that this recoupling reduces U.S. 2030 power sector CO2 emissions by roughly 145 million metric tons. These domestic estimates contribute to estimating the overall climate impact of LNG exports.
Non-Technical Summaries
- In less than a decade, the United States has gone from being a net importer of liquified natural gas (LNG) to the world’s largest...
Related
More from NBER
In addition to working papers, the NBER disseminates affiliates’ latest findings through a range of free periodicals — the NBER Reporter, the NBER Digest, the Bulletin on Retirement and Disability, the Bulletin on Health, and the Bulletin on Entrepreneurship — as well as online conference reports, video lectures, and interviews.
