Louisiana, the third-largest producer of natural gas nationally, has capitalized on President Donald Trump’s energy policies, which represent an about-face turn from the previous administration.
The Bayou State recently signed Act 462—a bill that reclassifies natural gas as “green energy”—into law. “This bill sets the tone for the future and will help the state pursue energy independence and dominance,” Louisiana Gov. Jeff Landry said.
Louisiana joins three other states—Ohio, Indiana, and Tennessee—that officially recognize natural gas as a reliable, affordable, and clean-burning energy source. Act 462 also recognizes nuclear energy as another clean energy source.
This new legislation follows on the heels of the state’s recent investment in liquified natural gas (LNG). In April, Louisiana Gov. Jeff Landry announced the development of a $17.5 billion LNG production plant. This new plant will complement the state’s four LNG export terminals. Early estimates forecast that the site will create about 3,000 new jobs and generate $4 billion in local property taxes.
This massive economic boost to Louisiana was made possible by prudent federal policies. During his first week in office, Trump reversed former President Joe Biden’s indefinite “pause” on LNG exports and terminal permits—an unwise move that effectively banned the product. Even during the pause, the United States remained the world’s largest exporter of the product.
Though federal policies shape energy markets, state-level policies also play a significant role—not always for the best.
Pennsylvania illustrates the consequences of bad policies. Though it produces twice as much natural gas as Louisiana, Pennsylvania is stuck in an uncomfortable limbo.
Home to the Marcellus Shale formation, Pennsylvania should be an ideal location for a robust LNG market. Penn America Energy Holdings has proposed developing a terminal in Chester, Pennsylvania, that would export 7.2 million tons of LNG to European and Asian markets.
However, the project faces “local opposition.” Environmental groups and activists have railed against the proposal, calling it a “new threat to their safety and health.”
Unfortunately, this eco-alarmist narrative has forced Pennsylvania into legal purgatory. In 2023, the Pennsylvania Commonwealth Court ruled that the commonwealth’s membership in the Regional Greenhouse Gas Initiative (RGGI)—a multistate compact that requires participating states to impose a region-wide carbon tax—was unconstitutional. Former Gov. Tom Wolf forced Pennsylvania into RGGI via executive action, rather than working with the state legislature, which has the power of the purse and the sole authority to enact new taxes. Following Wolf’s footsteps, Gov. Josh Shapiro appealed the decision, prolonging the already-elongated legal battle. Analysis by the Power PA Jobs Alliance shows that RGGI’s carbon tax would increase Pennsylvanians’ electric bills by 30%.
Shapiro has also doubled down on other bad policies. Pennsylvania’s Alternative Energy Portfolio Standards (AEPS) mandate the use of costly and unreliable energy sources, such as solar and wind. The annual costs of complying with AEPS are astronomical, costing Pennsylvania more than $700 million last year alone. Shapiro not only proposed increasing these mandates but also pitched a series of other equally devastating policies that would double the electric bills of Pennsylvanians over the next decade.
Sadly, tedious litigation and misguided policies only yield uncertainty, sidelining projects like the Chester LNG plant. Penn America Energy Holdings CEO Franc James even visited the White House to plead his case. But even with a federal energy-friendly administration, far too many energy projects in the Keystone State are stuck in an uncomfortable limbo.
Skeptics may scoff at the idea of natural gas as green, but it is the secret sauce behind Pennsylvania’s significant cut in carbon emissions. Thanks to natural gas, Pennsylvania cut carbon emissions by 9 million metric tons between 2018 and 2023, while increasing electricity generation by nearly 10 percent. For perspective, New York, a much larger state and a RGGI member, cut only 1 million metric ton of carbon emissions, while its electricity generation dropped by 6%.
Natural gas is also responsible for cutting emissions nationwide. Between 2005 and 2019, the United States removed about 819 million metric tons of carbon dioxide from the atmosphere. Of that total, nearly two-thirds of the reduction is thanks to natural gas, according to the U.S. Energy Information Administration.
And though its clean-burning nature is a nice perk, natural gas is key to keeping the lights on and the bills low. Right now, more states have the potential to ramp up reliable energy production, create jobs, and drive down utility bills nationwide.
But this can only happen with good policies—both at the federal and state levels. Louisiana is leading the way. Will Pennsylvania follow suit?
Elizabeth Stelle is the Vice President of Policy at the Commonwealth Foundation, Pennsylvania’s free-market think tank. Twitter: @ElizabethBryan
