Indo-Pacific Strategic Energy Initiative Act

To provide support for energy infrastructure projects in the Indo-Pacific region, and for other purposes. 1. Short title This Act may be cited as the Indo-Pacific Strategic Energy Initiative Act 2. Findings Congress makes the following findings: (1) The United States currently has an approximately 100-year supply of natural gas. (2) Natural gas will see increasing global demand and use beyond 2050. (3) United States natural gas production increased by 54 percent from 2005 to 2017. At the same time, total United States carbon dioxide emissions decreased by 14 percent. The natural gas share of electricity production increased from 19 percent in 2005 to 32 percent in 2017. (4) Between 2005 and 2019, carbon dioxide emissions from the United States power sector declined by 33 percent, with fuel switching to natural gas, accounting for more than half of those reductions. During that period, the United States economy grew by 20 percent, United States energy consumption fell by 2 percent, and per capita emissions dropped to their lowest levels since 1950. (5) Between 1990 and 2018, the natural gas and oil industry reduced methane emissions by 23.6 percent through voluntary actions, while expanding production by 70 percent. (6) Demand in the United States and globally for clean-burning natural gas and liquefied natural gas will continue to increase over the next several decades, even as renewable energy resources increase. (7) Demand for natural gas is rising in the Indo-Pacific region, particularly as countries look to make emissions cuts and transition from higher emissions fuel sources. (8) The expanding number of infrastructure projects in the Indo-Pacific region, carried out under the Belt and Road Initiative, is leading to higher emissions in the region. (9) According to the International Energy Agency, The number of countries and territories with [liquefied natural gas] import terminals has grown from nine in 2000 to 42 in 2020. transition[s] in Asian gas markets [are] even more important in the wider context of global clean energy transitions, where natural gas will be required to make a more flexible contribution as the share of variable renewable energy sources grows and coal use progressively declines (10) The United States saw a 66.3-percent increase in liquefied natural gas exports and an 11.2-percent increase in oil production in 2019. (11) As a result of the natural gas revolution, the United States petroleum trade deficit in dollars fell from about $320,000,000,000 in 2007 to about $3,000,000,000 in 2020, as net imports declined. (12) Australia and the United States are both important global energy exporters and thus have a shared interest in supplying the growing energy demand in the Indo-Pacific region. (13) Japanese companies have long invested in United States liquefied natural gas projects, including the Government of Japan shifting from relying on liquefied natural gas from the Middle East to liquefied natural gas from the United States. (14) The People's Republic of China currently is one of the largest financiers of overseas energy and greenhouse gas intensive projects. The People's Republic of China also uses those investments to project its influence and secure critical minerals supply chains and infrastructure. 3. Sense of Congress It is the sense of Congress that— (1) the United States reaffirms its commitment to quadrilateral cooperation with Japan, India, and Australia (collectively, with the United States, known as the Quad (2) the Association of Southeast Asian Nations (commonly referred to as ASEAN (3) the United States and the Republic of Korea enjoy a comprehensive alliance partnership, founded in shared strategic interests and cemented by a commitment to democratic values, which includes recognizing the important role of energy cooperation through the United States-Republic of Korea Energy Security Dialogue; and (4) the United States has economic, national security, and domestic interests in assisting allies and partners in Indo-Pacific countries to reduce greenhouse gas emissions and achieve energy security through diversification of their energy sources and supply routes. 4. Statement of policy It is the policy of the United States— (1) to engage and lead on international emissions reductions and adaptation, including assisting allies and partners in reducing higher emissions fuel sources through exports of cleaner-burning United States-produced fuels and emission-reduction technologies; (2) to advance United States foreign policy and development goals by assisting allies and partners of the United States in the Indo-Pacific region to decrease their dependence on energy resources from countries that use energy dependence to coerce, intimidate, and influence other countries; (3) to develop strategies to counter competition from the Russian Federation and the People's Republic of China to protect the energy and national security of the United States and the energy and national security of allies and partners of the United States in the Indo-Pacific region; (4) to support free and open trade in clean-burning energy products and promote the continued development of lower-emissions energy fuels and technologies in the Indo-Pacific region; (5) to improve free, fair, and reciprocal energy trading relationships with allies and partners of the United States in the Indo-Pacific region; (6) to promote the energy security of allies and partners of the United States in the Indo-Pacific region by encouraging the development of energy infrastructure and accessible, transparent, and competitive energy markets that provide diversified sources, types, and routes of energy; (7) to encourage public and private sector investment in lower-emissions energy infrastructure projects in the Indo-Pacific region; (8) to supply countries that rely on higher emitting fuel sources with cleaner burning and abundant alternatives; and (9) to help facilitate the export of United States energy resources, technology, and expertise to global markets in a way that benefits the energy security of allies and partners of the United States in the Indo-Pacific region. 5. Energy infrastructure project support (a) In general The Secretary of State, in consultation with the Secretary of Energy, the heads of other relevant United States agencies, and energy-importing allies and partners of the United States, shall, as appropriate, prioritize and expedite the efforts of the Department of State, the Department of Energy, and such other agencies in supporting the governments of Japan, India, Australia, and other like-minded Indo-Pacific countries (including member countries of ASEAN and the Republic of Korea) to increase their energy security and reduce energy emissions, including through— (1) providing diplomatic and political support to those governments, as necessary— (A) to facilitate international negotiations concerning cross-border infrastructure; (B) to enhance the regulatory environment with respect to energy projects in the Indo-Pacific region; and (C) to develop accessible, transparent, and competitive energy markets supplied by diverse sources, types, and routes of energy; and (2) providing support— (A) to improve energy markets in the Indo-Pacific region, including early-stage project support and late-stage project support for the construction or improvement of energy projects and related infrastructure pertaining to emissions reduction; (B) to diversify the energy sources and supply routes of Indo-Pacific countries; and (C) to enhance energy market integration across the region. (b) Project selection (1) Identification The Secretary of State, the Secretary of Commerce, and the Secretary of Energy shall identify energy infrastructure projects that would be appropriate for United States assistance under this section. (2) Eligibility A project is eligible for United States assistance under this section if the project— (A) has been identified by the Secretary of State, the Secretary of Commerce, and the Secretary of Energy as promoting energy security in the Indo-Pacific region or the country in which the project is located; (B) promotes the reduction of greenhouse gas and carbon dioxide emissions; and (C) is located in an Indo-Pacific country. (3) Preference In selecting projects for United States assistance under this section, the Secretary of State, the Secretary of Commerce, and the Secretary of Energy shall give preference to projects that— (A) are expected to enhance energy market integration; or (B) have the potential to use goods and services of the United States, another Quad country, a member country of ASEAN, or the Republic of Korea, during project implementation. (c) Diplomatic and political support The Secretary of State shall provide diplomatic and political support to the governments of Japan, India, Australia, and other like-minded Indo-Pacific countries (including member countries of ASEAN and the Republic of Korea), as necessary, including by using the diplomatic and political influence and expertise of the Department of State to build the capacity of those countries to resolve any impediments to the development of projects selected under subsection (b). (d) Project support The Director of the Trade and Development Agency shall provide early-stage project support with respect to projects selected under subsection (b). 6. Infrastructure funding (a) Establishment of strategic energy portfolio of the United States International Development Finance Corporation Title V of the Better Utilization of Investments Leading to Development Act of 2018 ( 22 U.S.C. 9671 et seq. 1455. Strategic energy portfolio The Corporation— (1) may provide support under title II for projects related to importation of liquefied natural gas and generation of low emission electricity and other energy, including for such projects of entities owned or controlled by the government of a foreign country; (2) may not prohibit, restrict, or otherwise impede the provision of support on the basis of the type of energy involved in a project; and (3) should, in providing support authorized by paragraph (1), coordinate with the Japan Bank for International Cooperation and the Government of Australia pursuant to the trilateral memorandum of understanding on development finance signed on November 12, 2018. . (b) Promotion of energy exports by Export-Import Bank of the United States The Export-Import Bank Act of 1945 ( 12 U.S.C. 635 et seq. 16. Strategic energy portfolio (a) In general The Bank shall establish a strategic energy portfolio focused on providing financing (including loans, guarantees, and insurance) for projects described in subsection (b) that may facilitate— (1) increases in exports of United States energy commodities; or (2) the export of United States equipment, materials, and technology. (b) Projects described A project described in this subsection is a project related to— (1) construction of liquefied natural gas import terminals; (2) commercialization of carbon capture, utilization, and storage; (3) development of blue hydrogen infrastructure; or (4) other low emission energy infrastructure. . (c) Private and foreign public sector investment (1) Private sector investment The Secretary of Commerce and the Secretary of State shall promote the funding of projects selected under section 5 among United States energy producers and exporters. (2) Foreign public sector investment The heads of the agencies described in section 5(a) may, for the purposes of this Act, partner and coordinate with public and multilateral financial institutions and export credit agencies of Japan, India, Australia, and other Indo-Pacific countries (including member countries of ASEAN and the Republic of Korea), such as the Japan Bank for International Cooperation. 7. Reporting (a) In general Not later than one year after the date of the enactment of this Act, and annually thereafter, the President shall submit to the appropriate congressional committees a report on progress made in providing assistance for projects under this Act that includes— (1) a description of the energy infrastructure projects the United States has identified for such assistance; and (2) for each such project— (A) a description of the role of the United States in the project, including in early-stage project support and late-stage project support; (B) the amount and form of any debt financing and insurance provided by the United States Government for the project as well as any coordination with foreign public financial institutions or export credit agencies; (C) the amount and form of any debt financing and insurance provided by foreign public financial institutions or export credit agencies; (D) the amount and form of any early-stage project support; and (E) an update on the progress made on the project as of the date of the report. (b) Appropriate congressional committees defined In this section, the term appropriate congressional committees (1) the Committee on Foreign Relations, the Committee on Energy and Natural Resources, and the Committee on Environment and Public Works of the Senate; and (2) the Committee on Foreign Affairs, the Committee on Energy and Commerce, and the Committee on Natural Resources of the House of Representatives.

Summary: Indo-Pacific Strategic Energy Initiative Act This bill requires and authorizes actions related to supporting energy projects in other countries, including projects to increase energy security in the Indo-Pacific region. The Department of State must prioritize U.S. government effort in helping the governments of Japan, India, and other like-minded countries in the Indo-Pacific region to increase their energy security and reduce energy emissions, including through providing diplomatic and political support as necessary. The U.S. Trade and Development Agency must provide early-stage support for energy infrastructure projects in the Indo-Pacific region that promote the reduction of greenhouse gas and carbon dioxide emissions. The State Department, the Department of Commerce, and the Department of Energy must identify projects appropriate for such support. The U.S. International Development Finance Corporation (1) may provide support for projects related to the importation of liquefied natural gas and the generation of low-emission energy, including projects owned by foreign government entities; and (2) may not prohibit or restrict support for a project on the basis of the type of energy involved. The Export-Import Bank must establish a strategic energy portfolio focused on financing projects that may increase U.S. energy exports and are related to the development or construction of (1) liquefied natural gas import terminals, (2) carbon capture and storage, (3) blue hydrogen infrastructure, or (4) other low-emission energy infrastructure.