1. EXECUTIVE SUMMARY

“Energy dominance” strategy

Given that the shale revolution has made the United States not only the world’s top producer of oil and gas but also a major exporter, the US approach to energy policy making has shifted from a scarcity mindset that emphasised energy security to one that is attempting to maximise the benefits of energy abundance. To this end, current US government policy centres on the concept of “energy dominance”, which reflects a strategy to maximise energy production, benefit from larger energy exports, be a global leader in energy technologies and keep consumer energy bills in check.

Deregulation

A central implementing plank of the energy dominance strategy is to eliminate regulatory hurdles to expanding US energy production and boosting the competitiveness of the US energy industry. To this end, the administration has undertaken a strategy to revisit or rescind a number of environmental regulations applicable to broad segments of the energy sector, including the power, transport and upstream sectors.

As part of the energy dominance strategy, the US administration has made several key regulatory moves. It has repealed and replaced the Clean Power Plan to cut carbon dioxide (CO2) emissions from the power sector; is revising Corporate Average Fuel Economy standards for automobiles; ended a moratorium on new coal leases on federal lands; rescinded regulations on hydraulic fracturing on federal lands; and plans to lower regulatory requirements to cut methane emissions from oil and gas production.

In 2017, the United States also announced its intention to withdraw from the Paris Agreement on climate change, effective in 2020. Still, US CO2 emissions have fallen across all sectors – notably the power sector – in the past decade. While emissions are expected to continue to decline over the coming decade, there remains a risk that, over time, the trend will reverse as nuclear retirements, continued use of coal-fired generation and increased consumption of oil for transportation – coupled with less stringent emissions regulations – offset gains from the move towards natural gas and renewables for electricity generation.

Energy infrastructure

The energy dominance agenda also includes a focus on expanding US energy exports. Since the last IEA in-depth review, Congress lifted a ban on crude oil exports at the end of 2015. Moreover, the Department of Energy (DOE) streamlined the government’s approach to liquefied natural gas (LNG) export approvals in 2014, helping to support the United States’ becoming a major global supplier of LNG and a net exporter of natural gas. The administration is also supportive of coal exports, though coal export infrastructure is limited, especially from the West Coast.

However, future production growth and exports depend on a complementary buildout of oil and gas pipelines. While private companies decide on whether to develop new energy infrastructure, the government plays an instrumental role in permitting. Energy infrastructure projects often require approvals from various federal, state and local authorities. Though the government has made efforts to streamline federal licensing for energy infrastructure (including rapid approval of projects such as the Keystone XL oil pipeline), there remain cases of midstream infrastructure struggling to keep pace with

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