S-4735-119
Read twice and referred to the Committee on Energy and Natural Resources.
Sponsored by Jeff Merkley (D-OR)
What it does
This bill would amend the Natural Gas Act to require the Federal Energy Regulatory Commission (FERC) to consider greenhouse gas emissions (including full supply-chain emissions) and domestic price impacts when deciding whether to approve natural gas imports or exports. It would designate certain outcomes — raising U.S. natural gas prices, increasing greenhouse gas emissions, and supplying energy to adversarial nations (Russia, China, North Korea, Iran, and others designated by the Secretary of Energy) — as inconsistent with the "public interest" standard used to approve such transactions. FERC would be required to issue implementing regulations within 30 days of enactment.
Who benefits
U.S. households and industries that use natural gas and could see lower prices if exports are restricted. Communities near LNG export terminals that could benefit from reduced emissions. Domestic manufacturers and utilities that compete with export markets for natural gas supply. Climate-focused advocacy groups and future generations who would benefit from reduced greenhouse gas emissions. U.S. national security interests, by restricting energy flows to geopolitical adversaries.
Who is hurt
Natural gas producers and LNG export companies whose export applications could be denied or delayed. Foreign buyers of U.S. LNG — particularly allies in Europe and Asia who depend on U.S. exports as an alternative to Russian gas. U.S. workers in LNG export terminal construction and operations. Investors in LNG infrastructure projects. Countries not designated as adversaries that may lose access to U.S. LNG supplies. FERC, which would face a demanding 30-day rulemaking deadline that may be difficult to meet with adequate procedural rigor.
Supporters argue
Supporters argue that current law gives FERC and the Department of Energy insufficient tools to weigh the full costs of LNG exports, including domestic price inflation and climate impacts. They contend that U.S. LNG exports have contributed to higher domestic natural gas prices, citing studies showing export-driven price increases, and that full lifecycle (Scope 1–3) emissions from LNG — including methane leakage during extraction and transport — make it a significant contributor to climate change. They further argue that restricting exports to adversarial nations like Russia and China directly serves U.S. national security interests.
Opponents argue
Opponents argue that restricting LNG exports would undermine U.S. allies — particularly European nations that turned to American LNG after Russia's 2022 invasion of Ukraine — and weaken U.S. geopolitical leverage. They contend that mandatory consideration of full Scope 3 emissions could effectively block most or all LNG export approvals, since any combustion of natural gas produces greenhouse gases, amounting to a de facto export ban without explicit congressional authorization. They also argue that the 30-day rulemaking deadline is legally insufficient to satisfy the Administrative Procedure Act's notice-and-comment requirements.
Constitutional context
The bill operates under the Commerce Clause (Art. I, §8, cl. 3), which grants Congress broad authority to regulate international trade in energy commodities. However, the bill's directive that FERC promulgate regulations within 30 days raises concerns under the post-Loper Bright framework: courts will independently assess whether FERC's implementing rules stay within the statutory boundaries Congress set, without deferring to the agency's own interpretation. The major questions doctrine from West Virginia v. EPA (2022) could also be invoked if opponents argue that mandatory Scope 3 emissions review effectively functions as a sweeping climate regulation without sufficiently clear congressional authorization.
Checks and balances
Congress would expand FERC's mandatory review criteria; FERC gains new authority to deny export approvals on emissions and price grounds, subject to judicial review under the APA and the major questions doctrine; the Secretary of Energy retains authority to designate additional countries of concern through a notice-and-comment process.
Historical precedent
The Department of Energy paused new LNG export approvals in January 2024 to conduct an updated public interest review, raising similar questions about the scope of the "public interest" standard under the Natural Gas Act — though that pause was an executive action, not a statutory change.