Says short-sighted energy policies have emboldened Putin
WASHINGTON—United States Senator Bill Hagerty (R-TN), a member of the Senate Banking Committee and Foreign Relations Committee, has sent a letter to the CEO of the U.S. International Development Finance Corporation (DFC), Scott Nathan, urging him to deprioritize DFC’s Environmental and Social Policy and Procedures (ESPP) that limit investments in American oil and gas in favor of so-called green energy.
“This counterproductive fixation on ‘green’ energy has led DFC to shun investments in fossil fuel projects, even if they have lower net environmental impact than the non-American alternative. This short-sighted policy, similar to those of our European allies, has led to a crippling energy dependence on Russia, emboldened Putin, and prevented our allies from being able to respond forcefully to the invasion of Ukraine,” Hagerty wrote.
Energy prices have steadily risen since President Biden took office, making it clear that the United States must do everything it can to boost domestic energy production both to protect our national and economic security and supply our allies in order to reduce the global influence of malign actors like Russia, Iran, and Venezuela.
“In light of the current crisis, I urge DFC to make a concerted effort to help fund investments that would allow the U.S. fossil fuel industry to deliver cheap, reliable, and environmentally responsible energy for the world, without forcing them into the arms of adversaries and into projects with far more negative environmental impact,” Hagerty concluded.
A copy of Hagerty’s letter can be found here and below:
Dear Mr. Nathan:
In 2018, Congress established the U.S. International Development Finance Corporation (DFC) to help advance American foreign policy priorities by driving private sector investment. A steady, yearlong increase in the price of energy has made it more apparent than ever that maintaining the American energy industry’s role in the global market is of paramount importance for both national security and the health of our domestic economy.
To respond, we should maximize our investments in energy production. American energy companies have world-leading expertise in all sectors, including in the most widely used sources, such as fossil fuels and nuclear power. Fossil fuel energy produced by American companies often has a lower greenhouse gas profile than the existing or alternative sources.
In July 2020, DFC took the sensible step of changing its Environmental and Social Policy and Procedures (ESPP) to allow it to finance nuclear power projects, which we hope you will aggressively pursue. However, the ESPP still myopically excludes projects unless they are compatible with low carbon economic development. This counterproductive fixation on “green” energy has led DFC to shun investments in fossil fuel projects, even if they have lower net environmental impact than the non-American alternative. This short-sighted policy, similar to those of our European allies, has led to a crippling energy dependence on Russia, emboldened Putin, and prevented our allies from being able to respond forcefully to the invasion of Ukraine.
In light of the current crisis, I urge DFC to make a concerted effort to help fund investments that would allow the U.S. fossil fuel industry to deliver cheap, reliable, and environmentally responsible energy for the world, without forcing them into the arms of adversaries and into projects with far more negative environmental impact.
Sincerely,
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