Feds: Exporting natural gas will cause heating, electric bills to rise

Exporting some of the glut of natural gas in the United States market will cause large price increases for domestic consumers, including higher electricity bills, federal researchers said in a report released Thursday morning.

The Energy Information Administration report determined that, from 2015 to 2035, natural gas bills would increase 3 percent to 9 percent more if exports were allowed than if they were not. Electricity bills would increase by 1 percent to 3 percent more.

Several companies are seeking federal approval to export liquefied natural gas to Asian and European countries that are commanding prices as much as five times higher than in the United States. Domestically, the price of natural gas has plunged below $3 per million British thermal units, from more than $15 a few years ago.

Businesses that purchase natural gas for industrial and residential use have rallied against exporting gas, arguing that it would cause prices to rise. Companies seeking to export the fossil fuel counter that the benefits  — increased domestic production, more jobs, and revenue from the overseas sales — would outweigh a nominal domestic price increase.

EIA researchers determined that domestic natural gas production, which has begun to slow in light of plummeting prices, would increase if exports are allowed.

The higher production would cover just 60 percent to 70 percent of the natural gas exports, the report found. The remaining 30 percent to 40 percent would eat into natural gas volumes that otherwise would have been used domestically, unless higher prices cut U.S.  demand for the fuel.

Power companies would account for most of the reduced demand for natural gas, because they would turn more to coal than  higher-priced natural gas to generate electricity, according to the federal report.