New England needs gas to survive the winter. Governor Sununu wants to waive the Jones Act to bring in Liquified Natural Gas from otherr US states on a foreign tanker. In the clip below, Dr. Sal discusses both sides of the Jones Act.
Some are slamming Gov. Sununu for wanting to waive the Act, while others want it waived. Dr. Sal came up with a solution. The US doesn’t have a tanker and must rely on foreign ships because of the Jones Act, which causes problems of exorbitant costs. Dr. Sal suggests we build a tanker, although it’s more complicated than that.
New England is facing its highest energy costs, and Sununu wants the White House to waive the Jones Act or come up with a solution. The federal response was underwhelming.
All of New England’s LNG comes through Albany, and there is no opportunity to do that now.
There is nothing political about high energy prices. The White House should want to help.
The Jones Act is a federal law that regulates maritime commerce in the United States. The Jones Act requires goods shipped between U.S. ports to be transported on ships that are built, owned, and operated by United States citizens or permanent residents.
The Jones Act won’t allow New England to import LNG from US states with foreign tankers to reduce costs, and we don’t have US tankers.
The US is the largest exporter of LNG but getting it to New England is impossible. New York won’t allow a pipeline to get it from Central US to New England.
The six governors of New England are very worried about the LNG supply. The sanctions and the cutoff of LNG from New England to Europe are the reasons for the problem. The Jones Act requires US tankers manned by US sailors to ship LNG tankers throughout the US. The problem is the US doesn’t have LNG tankers despite being the largest exporter of LNG in the world.
Dr. Sal looked at how much we are talking and how much New England needs. An LNG vessel comes into New England every two weeks in the winter. It’s coming from Trinidad. The easiest and cheapest solution is to build a second pipeline, but New York State won’t allow it. When you deliver by ship, you have to liquefy it, unload it, and then re-gasify it. On top of the cost of gas, the shipping costs about a million dollars a day.
One US tanker could handle this.
You need LNG delivered all the time because it can’t be stored for long periods. Thus, they need regular deliveries.
Even if you waive the Jones Act, you are competing against Asia, which will be extremely expensive. Foreign tankers will go to where they will get the most money. They’re foreign ships, and New England would be at their mercy. Prices would be high.
Dr. Sal has a brilliant compromise solution. Waive the Jones Act for five years. In the meantime, build a tanker or several and use government subsidies for some of the cost. We’ve done it before.
If you let the foreign tankers in, you will have the same problem with diesel, so waiving the Jones Act permanently doesn’t help. The Act is a good act.
The US could deliver LNG to Puerto Rico and elsewhere to help offset the costs.