US Aims to Double Gas Exports to UK Under Plans to Drive Down Energy Prices

The LNG (liquefied natural gas) tanker Flex Volunteer, sailing under the flag of the Marshall Islands, cruises near the Saint-Nazaire bridge over the Loire estuary, as it leaves the dock of the LNG Terminal of Montoir-de-Bretagne, near Saint-Nazaire, western France, on April 12, 2022. (Sebastien Salom-Gomis/AFP via Getty Images)

The United States aims to double its gas exports to the UK under plans to boost energy security and drive down energy prices.

U.S. President Joe Biden and UK Prime Minister Rishi Sunak announced on Dec. 7 that they have set up the “UK–U.S. Energy Security and Affordability Partnership,” a new high-level bilateral group to focus on energy security, efficiency, and affordability.

Russian President Vladimir Putin’s invasion of Ukraine is one factor that caused international energy prices to soar, raising the cost of living in both the UK and the rest of Europe.

Under the new UK–U.S. partnership, the two countries will work together to “reduce global dependence on Russian energy exports, stabilise energy markets, and step up collaboration on energy efficiency, nuclear, and renewables,” Downing Street said.

The initiative will be steered by a new UK–U.S. Joint Action Group, led by senior officials from the UK government and the White House.

Over the coming year, the United States aims to more than double the amount of gas exported to the UK in 2021 in a bid to reduce price volatility, the government said.

Stabilising the Market

Citing the war in Ukraine, Sunak and Biden said in a joint statement that it is “more important than ever” for allies to work together to build “resilient international systems.”

“Our immediate shared goal to stabilise energy markets, reduce demand, and ensure short-term security of supply is underpinned by the longer-term objective of supporting a stable energy transition to achieving net-zero emissions by 2050, which in itself will strengthen our energy security,” they said.

“To this end, we are establishing a Joint Action Group for Energy Security and Affordability to accelerate our immediate cooperation on short-term action to support energy security and affordability in the United Kingdom and across Europe.”

In a separate statement, Sunak said: “Together the UK and U.S. will ensure the global price of energy and the security of our national supply can never again be manipulated by the whims of a failing regime.

“We have the natural resources, industry, and innovative thinking we need to create a better, freer system and accelerate the clean energy transition. This partnership will bring down prices for British consumers and help end Europe’s dependence on Russian energy once and for all.”

The new UK–U.S. partnership will work to ensure “the market delivers sustained increases in the supply of Liquefied Natural Gas (LNG) to UK terminals” from the United States, the Prime Minister’s Office said.

The United States will strive to export at least 9–10 billion cubic metres of LNG over the next year via UK terminals, more than doubling the level exported in 2021, it said, adding that it will be “good for both UK and European partners.”

The initiative has an “immediate goal” of stabilising energy markets and reducing demand, while seeking to build long-term resilience by accelerating the shift to “clean” alternatives.

This will involve promoting nuclear fuels as a “safe” and “reliable” part of the transition, expediting the development of clean hydrogen, and driving international investment in offshore wind and carbon capture.

Wind turbines adorn the landscape in the Southern Lake District, in Lambrigg, England, on Nov. 25, 2022. (Christopher Furlong/Getty Images)

Energy U-Turn

The energy crisis has forced Sunak’s government to bow to pressure from Tory backbenchers to allow the development of new onshore wind farms.

Calls to end the de facto ban on new onshore wind farms have grown amid efforts to secure the UK’s energy independence as Russia’s invasion of Ukraine has squeezed supplies.

Former Prime Ministers Liz Truss and Boris Johnson joined a Tory backbench rebellion against the ban by signing an amendment to the government’s Levelling Up Bill to allow the development of onshore wind.

Sunak expressed opposition to building new turbines onshore during his failed first bid for the Conservative leadership, but has changed his position under pressure.

Under new proposals set out by the Department for Levelling Up, Housing, and Communities on Dec. 6, onshore windfarms can be developed, though planning permission would be dependent on demonstrating local support and “appropriately” addressing any impacts identified by the community.

Ministers will also seek views on developing partnerships with “supportive” communities, so those who wish to host new developments can see some benefit, such as through lower energy bills.

A delayed decision on whether to approve plans for a coal mine on the edge of Whitehaven in Cumbria is also expected this week, in another test of Sunak’s leadership.

The decision is currently due to be made on or before Dec. 8, after the deadline was pushed back several times.

While the plan is backed by some Tory MPs, it has also drawn significant criticism from environmentalists.

PA Media contributed to this report.