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High electricity costs tied to price of natural gas, not Green New Deal
If Your Time is short
- Green New Deal legislators advocate for a broad framework dedicated to reducing greenhouse gas emissions and pollution. But the Green New Deal resolutions have not passed.
- Experts say increasing electricity costs are tied to the price of natural gas and the current global economy around energy. The price of natural gas increases as Europe looks for suppliers outside of Russia for natural gas.
Temperatures in Texas are rising amid a June heatwave, testing the state's power grid and driving up demand for electricity.
In a June 4 tweet, U.S. Sen. Ted Cruz, R-Texas, said Texans can blame their higher electric bills on supporters of the Green New Deal, a-yet-to-be-passed congressional plan touted as a strategy for tackling climate change.
"The impact of President Biden being beholden to the Green New Deal radicals in his party has electricity costs through the roof in Texas," Cruz wrote in his tweet.
He included a link to a Dallas Morning News article that tied electricity costs to the price of natural gas, which has been on the rise.
Texas accounts for 15% of the U.S. total natural gas consumption and is the country's top natural gas consumer, according to the U.S. Energy Information Administration under the Department of Energy. In 2020, the amount of natural gas used for electricity generation was greatest in Texas compared to other states.
So, what (or who) exactly is to blame for sky-high electric bills? Cruz says the progressives who champion measures to reduce the impact of climate change are at fault, but energy experts say Russia's war on Ukraine is driving up the cost of natural gas, which in turn impacts electricity costs. Let's explore.
Michael Webber, a University of Texas professor with research specializing in clean energy technology, said the article Cruz tweeted undercuts his claim, because it attributes rising electricity costs to the price of natural gas, with no mention of the Green New Deal.
Webber said the Green New Deal has not passed, so it has no influence over the current energy situation. The measure calls for the federal government to take steps to reduce pollution and greenhouse gas emissions. Webber, who responded to Cruz's tweet online, called Cruz's claim "fundamentally flawed."
But Steve Guest, a Cruz spokesperson, said in an email that Cruz's tweet "is completely accurate." Guest said that Biden's campaign website touts his support for the Green New Deal as "a crucial framework for meeting the climate challenges we face."
Guest pointed to campaign trail and debate stage promises Biden made that aligned with a goal to reduce greenhouse gas emissions.
Biden paused new oil and gas leases on federal lands, but the pause on new leasing did not impact current oil and gas production. In April, the Biden administration announced that it would resume selling leases for drilling on public lands — with some limitations on the number of acres available and an increase in fees companies must pay to drill.
Carey King, assistant director at the University of Texas Energy Institute, said North America has been shipping more natural gas abroad over the last few decades. With the U.S. and North America more interconnected in that global trade, natural gas prices in Europe and Asia affect prices more in the U.S.
Europe is seeking to import natural gas from countries other than Russia due to Russia's invasion of Ukraine. Europe is paying more money for natural gas, including liquefied natural gas from the United States.
"And if LNG (liquefied natural gas) exporters in the United States can charge a higher price to sell to Europe, then they will," King said. "Because they're buying at a higher price, that affects the price of gas throughout the continent."
U.S. exporters shipping more to Europe for a higher price puts pressure on natural gas prices in North America, King said.
U.S. liquefied natural gas exports to Europe increased this year, according to the Energy Information Administration. The U.S. exported 74% of its liquefied natural gas to Europe through April this year compared to the annual average of 34% in 2021. At the same time, exports to Asia decreased through April.
While investors could invest in more natural gas infrastructure for production and export, King said, that could take multiple years — and it's not certain whether natural gas demand from Europe will remain at higher levels.
Cruz tweeted, "The impact of President Biden being beholden to the Green New Deal radicals in his party has electricity costs through the roof in Texas."
However, Green New Deal legislation has not passed. Rising electricity costs are tied to natural gas prices, which in turn are impacted by European nations turning away from Russia as a major supplier of natural gas.
We rate this False.
Tweet by Senator Ted Cruz (@sentedcruz) , June 4, 2022
Email from Steve Guest, special advisor for communications for U.S. Senator Ted Cruz, June 8, 2022
Mitchell Schnurman, Dallas Morning News, "‘We're in trouble’: Electric rates in Texas have surged over 70% as summer kicks in," June 2, 2022
Phone interview with Carey King, assistant director and research scientist at The University of Texas at Austin Energy Institute, June 8, 2022
Phone interview with Michael Webber, Josey Centennial professor at the University of Texas at Austin, June 9, 2022
JoeBiden.com, "The Biden plan for a clean energy revolution and environmental justice"
U.S. Energy Information Administration, "Natural Gas: Henry Hub Natural Gas Spot Price"
U.S. Energy Information Administration, "Today in Energy: U.S. liquefied natural gas exports to Europe increased during the first 4 months of 2022," June 7, 2022
ERCOT, "Generation: Fuel Mix Report 2022," June 7, 2022
Energy Information Administration, "Texas: State Profile and Energy Estimates," last updated May 19, 2022
Nusaiba Mizan, PolitiFact, "Texas Rep. Roger Williams offers one estimate of household costs from Biden energy policies," Nov. 30, 2021
Department of the Interior, "FACT SHEET: President Biden to Take Action to Uphold Commitment to Restore Balance on Public Lands and Waters, Invest in Clean Energy Future," Jan. 27, 2021
Energy Information Administration, "EIA expects continued high energy prices through 2023," June 7, 2022
Josh Lederman and Zoe Richards, NBC News, "Biden administration to resume leasing for oil and gas drilling on federal lands," April 15, 2022
Energy Information Administration, "Natural Gas Marketed Production Wyoming"
Energy Information Administration, "Natural Gas Marketed Production Utah"
Energy Information Information, "Natural Gas Marketed Production Federal Offshore Waters"
U.S. 117th Congress, H.Res 332
U.S. 117th Congress, S.Res 166
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High electricity costs tied to price of natural gas, not Green New Deal
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