Hearings to examine European energy security.

I was just sharing with Ranking Member Murphy a chart which I'm going to share with everybody here as we start this hearing that shows some alarming figures with you all. But before I get into that, I need to officially state this hearing of the Senate Foreign Relations Committee will now come to order. On this iPad here, I've got a live tracker of European purchases of Russian energy since the start of the invasion in Ukraine. Now, we're not allowed to have big PowerPoint presentations here, but bear with me. This thing's just clicking down, or clicking up I should say, euros. And right now it says 219 billion, 221 million, 431,104, now it just jumped to 581 euros that have now been invested in Russia in purchasing Russian oil and Russian gas. It's called russianfossiltracker.com if you want to see it yourself. And it goes back to the beginning of the Russian invasion of Ukraine. So the number right now, as I mentioned, is about 220 billion euros. As of December, the EU had provided around 200 billion euros of aid to Ukraine. European purchases of Russian energy are funding the largest land war in Europe since the Second World War. I just wanted to set the stage with that before we get started. I want to thank our two witnesses for being here today to discuss such an important topic. And a great deal of thanks to Ranking Member Murphy for his participation and help in organizing this hearing. Our bipartisan cooperation on these issues will shine a light on some of the good work Europe has done to shore up its security as well as the policy changes the EU can enact to ensure the continent's energy security. Now on to our witnesses. Jeffrey Pyatt is a distinguished fellow at the Atlantic Council's Global Energy Center and a senior managing director at McLarty Associates. Prior to his current positions, he had a long and distinguished career at the U.S. Foreign Service, serving as Assistant Secretary of State for Energy Resources, as U.S. Ambassador to Ukraine and Greece, and other senior postings both abroad and in Foggy Bottom. He has extensive experience working on European energy security issues. We are grateful he could be with us here today to share his expertise. Thank you. Dan Byers is Vice President of Policy at the Global Energy Institute at the U.S. Chamber of Commerce, where he focuses on environmental and regulatory issues. He previously served as a staff director for the House Energy and Environment Subcommittee, as an official in the White House Office of Science and Technology Policy, and on the White House Economic Council. Mr. Byers is deeply knowledgeable about energy regulation and energy markets, and we're grateful he could be here today to share some of his knowledge with us. So on to the matter at hand. Energy security is national security. Both the United States and Europe have become increasingly aware of that fact over the last four years, creating an opportunity for us to collectively build a resilient energy production and transport network that would form the bedrock of our economies. The European Commission's recent regulatory reform is a step in the right direction, aligning bloc-wide regulations with more pro-energy, pro-business, pro-market policies. Passing that reform took creativity and courage. I'd like to commend the European People's Party and their voting partners for the good work they've done on that package. But there's still a lot more to do, clearly. All of Europe must recognize that it cannot function or recognize its economic and security goals without baseload power, and it must enact further regulatory reform to modernize the European energy ecosystem. The continent has an opportunity to permanently end its resilience, its reliance on Russian energy, providing true independence and autonomy for America's partners on the other side of the Atlantic. Without enacting further regulatory reforms, Europe may find itself staring down the barrel of resuming Russian energy dominance or extortion, putting itself back into the vulnerable position it found itself in 2022. If Europe learns nothing else from the Russian invasion of Ukraine, let it be that energy security and supply chains are vital to national sovereignty. Compromises can't be made in those matters, and we must work together to ensure those networks' resilience and survivability. I remember a trip I took to the Baltics a few years ago. I remember hearing the story about once upon a time the nuclear reactor that existed there that was dismantled, taken out of production at the request of the EU to join the EU. And they took me up to the Baltic Sea where I could see a beautiful new LNG import terminal. But once upon a time, Lithuania used to be a net energy exporter. And after actions taken, short-sighted, to remove the baseload power of their nuclear power station, they became an energy importer. And then of course, with the Russian invasion of Ukraine, that problem clearly was further exacerbated. I encourage our European partners to take a realistic view on building reliable energy infrastructure. One need look no further than Spain and Portugal to see the dangers of over-reliance on intermittent sources. The entire Iberian Peninsula found itself without power last year, underscoring the vulnerability of countries that fail to maintain a diverse set of energy sources. And to be clear where I stand on here, I want to see a diverse energy portfolio. I just want to see more electrons and more baseload power and more diversity as it relates to energy. As the West builds the economy that will drive our countries forward, baseload power will become even more important. Whether it be for data centers, manufacturing, or defense production, reliable power is the backbone certainly of future prosperity. The United States and many of our partners and allies stand at the ready to work with Europe to increase energy supply, be it oil, gas, nuclear, hydro, or renewables. The reinvigoration of our economies will require a holistic, truly all-of-the-above energy approach. And I believe Europe must act now. Enacting the regulatory reforms and infrastructure investments necessary to sign long-term energy import and development contracts and ensure the continent's future. Prosperity and security are dependent on such changes, and I look forward to continuing to work with our European partners to build a more secure future for both Europe and the rest of the world. Now I'd like to recognize the very distinguished member and Ranking Member for his comments, Senator Murphy.

Thank you very much, Senator Daines. Thanks for pulling this hearing together. Really looking forward to hearing from our witnesses today. When Russia launched its full-scale invasion of Ukraine, it didn't just shatter the post-war inviolability of Europe's borders, it exposed this glaring strategic weakness in European security, an energy architecture deeply, dangerously dependent on Russian oil and gas. For years, Europe's reliance on Moscow's pipelines wasn't just an economic vulnerability, it was a geopolitical lever that Vladimir Putin had designed and could pull at any time to coerce his neighbors and fracture democratic consensus, especially in Europe. That leverage became painfully clear when Moscow threatened to cut off energy flowing through Ukraine to the rest of the continent, and Europe was left scrambling to ensure its citizens had enough power to heat their homes. Ultimately, this is a good news story in that Europe did not bow to Russia's demands. Instead, the EU has worked successfully to end the dependence, their dependence on Russia and improve its energy security. Europe used to buy almost half its gas from Russia. Now that figure is down to 20 percent, with a new commitment to buy zero oil or gas from Russia by 2027. In yet another example of Putin's miscalculations, what he intended as leverage to try to split Europe has ended up reducing Russia's influence on Europe. Now, the Biden administration, assisted by a bipartisan consensus in Congress, helped Europe make this transition. For example, at Ambassador Pyatt's urging, I led a bipartisan effort to allow the Development Finance Corporation to finance strategic energy projects in Europe, something that had not been allowed under the law prior to that change. And I want to thank Senator Johnson and other Republicans who helped make that change in law happen. But President Trump threatens to unwind a lot of the progress that Europe has made, in part because he constantly injects frictions into our relationship with Europe that causes Europe to spend all of its time trying to plan and plot its response to Donald Trump instead of staying united in its efforts to fight back against Russia's political leverage. Trump's rhetoric and his policy towards Europe has been wild, it's been erratic. He levies tariffs that have nothing to do with the United States and are instead simply punitive. He threatened war with Europe over, unbelievably, Greenland. He's pulled the U.S. out of nearly every important international organization where the United States and Europe traditionally have built strength to confront Russia and China. He praises Putin, gives Putin the legitimizing photo ops that Putin so badly desires. And of course, Putin stands and cheers as Trump injects such instability into the U.S.-Europe relationship that Europe spends its time managing that relationship instead of making more down payments on its efforts to become fully energy independent of Russia. But it gets worse. So listen, I am a supporter of getting American LNG to Europe. I believe that's a really important near-term and medium-term bridge. But I ultimately want a world in which Europe and the United States are energy self-sufficient. The sun does shine in Europe, the wind blows, nuclear power works. But President Trump's war on non-fossil fuel energy is really bad for European energy security. We need to make advancements on solar and wind technology, and technology controlled by the United States and Europe, not technology controlled by China. Small-scale nuclear has got to be on that list as well so that Europe can permanently get itself off oil and gas. Being dependent on Azerbaijan or Saudi Arabia or Venezuela or Iran isn't much better than being dependent on Russia. And then to top it all off, when the United States does get involved in these short-term alternatives, which I think are incredibly necessary to Russian oil, corruption creeps in. Reports are coming out of the Balkans suggesting that President Trump is providing critical American support for an energy project that is being led by two individuals whose qualifications are simply that they helped Donald Trump overturn the 2020 election. Joseph Flynn and Jesse Binnall have no qualifications to build a pipeline in the Balkans. They are being pushed by the administration to get involved in this project because they are close to the President. So there are lots of topics for today's hearing. I think it's vitally important. There are lots of places where the Chairman and I agree, especially when it comes to the short-term work we have to do to shore up Europe's energy reserves and their flows. A lot has gone right in Europe. They have made this hard pivot off Russian energy, but a lot of examination is still, I think, left to do in the ways that the Trump administration is very often standing in the way rather than helping Europe complete this transition. Again, really looking forward to the witnesses. Mr. Chairman, thanks for convening the hearing.

Senator Murphy, thank you. Our first witness is the Honorable Jeffrey Pyatt, Senior Managing Director Energy and Critical Minerals, McLarty Associates, and distinguished fellow, Global Energy Center, Atlantic Council. Mr. Pyatt, the floor is yours.

Great. Thank you very much, Mr. Chairman, Ranking Member Murphy. I'm delighted to be here. I enjoyed tremendous support from this committee during 12 years as a presidential appointee representing the United States around the world, and it's a tremendous honor to be speaking now as a private citizen, but also to be doing so on issues that my team at the State Department focused on every single day, advancing exactly the framework that you suggested, Mr. Chairman, the understanding that energy security is national security. I have a longer prepared statement which I will simply introduce for the record. I would like to focus these oral remarks on a couple of simple points. And first of all, Mr. Chairman, I want to say I'm with you on the tracker and the iPad data you showed. And I will just recall, and I expect Senator Murphy will also recall, a long evening in the winter of 2013 spent with President Yanukovych in Kyiv, where the President filibustered to explain all of the difficulties that he was living with. But the number one difficulty was the pressure that President Putin was applying to President Yanukovych as he was trying to navigate through the political complexities of the Maidan. And I think I also remember vividly many visits to Ukraine with Senator Murphy, with Senator McCain, many others, where we talked about exactly the issue you highlighted, which was the risks to Europe from its dependency on Russian energy supplies and the importance of breaking that dependency as fast as possible. I would also say in this regard, I was so pleased to see the news last week with the Foreign Relations Committee reporting out the Shadow Fleet Act. That's exactly the kind of measure the United States ought to be taking, to write into law sanctions against Novatek, Arctic LNG 2, to harmonize U.S. sanctions against Nord Stream 2 with European sanctions. Because when Congress acts in this way, the markets listen, because that has the force of law and it will last from one administration to the next. So this is so, so important. I want to highlight, and I've also highlighted in my written statement, the point Senator Murphy made, the dramatic progress that we have achieved through bipartisan efforts over many years to change the European approach to Russian energy. And I would put a particular spotlight on the regulations that the European Union implemented just this week, which will accomplish a full phase-out of all Russian gas by 2027, but in fact within two months will bar spot contracts on LNG. This represents a huge win for the United States. It also advances President Trump's vision of forcing Putin to negotiate by signaling to him that there is a real cost from his continued war in Ukraine, the attacks that he is waging even this week on the people of Ukraine. And I think it hasn't been sufficiently appreciated in the Washington conversation what an enormous accomplishment this is for American transatlantic energy diplomacy. But also the degree to which it was enabled not just by Putin's strategic short-sightedness, and he has lost Europe as a market forever, I am quite confident, but also by the accomplishments of the U.S. LNG industry, by our producers, who have achieved massive efficiencies, who have grown the United States into the largest LNG exporter in the world, and who have demonstrated to the Europeans that the cleanest, most reliable, and most affordable option for displacing Russian gas is American LNG. The other point I want to put a spotlight on for just a moment is the work that Europe continues to do to build the infrastructure that is necessary to remap its energy system from one that was earlier dependent on Russia to a new one that will be oriented to the West. One project that is emblematic in this area, which I was proud to champion both as Ambassador to Greece and then as Assistant Secretary, is the Vertical Corridor, which involves building infrastructure and utilizing old Soviet infrastructure to bring gas and LNG from Southeastern Europe and especially from regas facilities in Greece northward into Bulgaria, Romania, Moldova, and Ukraine. And just to give you one specific example, just in the past few weeks, Ukraine's largest private energy company, DTEK, for the first time had a delivery of American LNG which was landed at Revithoussa outside Athens. Was then delivered to Ukraine and put into Ukraine's underground storage facilities and then delivered to customers in Poland. So already the Vertical Corridor is demonstrating its utility as a strategic project. The best work that I did in government is the work that others follow up on. So I'm absolutely delighted that Jared Hagen at the National Energy Dominance Council, Secretary Wright, have all championed this same project. And I'm confident between the alignment of the Ukrainian partners, what Greek companies are doing, and what the European Commission importantly is doing, we'll see this become a successful template for how we re-engineer the energy map of Europe for an era where Europe will never again be dependent on unreliable Russian supplies. Thank you very much.

Mr. Pyatt, thank you. I will turn now to Mr. Dan Byers, Vice President of Policy, Global Energy Institute, U.S. Chamber of Commerce. Mr. Byers, the floor is yours.

Thank you, Chairman Daines, Ranking Member Murphy, for the opportunity to testify today. As you said, I'm Dan Byers with the U.S. Chamber of Commerce Global Energy Institute, where among other things, we focus on expanding market access for U.S. exports while boosting energy security for America and our allies. As we enter 2026, Europe continues to take important steps to reduce its dependence on Russian energy. But it does still remain the world's largest buyer of Russian gas, importing LNG and pipeline volumes worth an estimated 15 billion euro in 2025. As you said, these purchases fund the Kremlin's war machine and leave the continent exposed to significant security and supply risks. Fortunately, more progress is on the horizon with newly approved EU legislation last month mandating the complete phase-out of Russian gas imports by the end of 2027. The Trump administration has strongly encouraged this development, and in December convened the Partnership for Transatlantic Energy Cooperation, or the P-TEC forum, in Athens, where several important business deals and policy goals were announced alongside European leaders. This high-level political support is bolstered by the fact that energy is a centerpiece of the U.S.-EU trade deal and further complemented by a U.S. export industry more than ready to help the EU meet this challenge. Already the world's leading exporter, the U.S. has dominated global LNG project development and contracting activity since the Department of Energy's pause on licensing new facilities was lifted in early 2025, with more than $60 billion in new investments now underway. In short, America's growing LNG supply is an obvious and timely solution to Europe's growing natural gas supply gap, and the industry is poised to deliver the security and market stability our allies need. Despite this progress, a number of regulatory and investment obstacles are hampering transatlantic commercial relations and must be addressed. On the regulatory side, I want to call attention to the Corporate Sustainability Due Diligence Directive and the EU Methane Emissions Regulation. My written testimony expands on both of these, but in brief, CS3D is a sweeping law requiring U.S. companies to align their global operations with EU standards that are not binding under U.S. law. And it could make American companies liable in EU courts for conduct that is perfectly lawful in the U.S. This extraterritorial overreach is a major obstacle to enhanced trade and investment, and the Chamber is leading efforts to address it. Meanwhile, the EU Methane Emissions Regulation, which requires importers of oil and gas to report producer-level emissions data and meet certain methane emissions intensity standards, subject to non-compliance penalties of up to 20 percent of the importer's total worldwide revenues. This has imposed significant risks that are impeding negotiation of new supply agreements with U.S. gas exporters. These concerns are not limited to the United States. In Europe, various industry coalitions have issued increasingly urgent warnings that the law is, quote, "unworkable," jeopardizes European energy security and competitiveness, and is likely to lead to higher energy costs. We face an equally important challenge on the investment side, where a number of strategic infrastructure projects are needed to reduce vulnerabilities and unlock access to regional markets. In particular, I want to follow up Ambassador Pyatt in highlighting the Vertical Gas Corridor, which aims to expand continuous south-to-north transport capacity from Greece to Ukraine, providing countries in Southeastern Europe a reliable LNG alternative to Russian pipeline gas and so-called Turkish blends transiting into the EU from Turkey. Despite strong political support, the Vertical Corridor faces commercial, regulatory, and financing barriers that must be resolved for it to fully proceed. Chamber and its members are eager partners in the ongoing effort to de-risk the Vertical Corridor and realize the LNG-enabled security benefits that it could deliver. And before I close, I would be remiss if I didn't emphasize both the environmental and economic benefits that accompany U.S. LNG's role as a guarantor of global energy security. A study undertaken by S&P Global for the Chamber last year found that LNG exports add $1.3 trillion to U.S. GDP through 2040 and support nearly 500,000 jobs. Importantly, 37 percent of those jobs are based in non-producing states, so the benefits extend through the energy value chain and far beyond the locations where gas is produced and exported. Additionally, the study detailed the significant emissions reductions that accompany LNG exports, finding that, among other things, the emissions intensity of Russian LNG and pipeline gas is 44 percent and 59 percent higher respectively than that of U.S. LNG. In summary, with strong leadership and cooperation between U.S. and EU government and industry, targeted policy measures can unlock Europe's pathway to long-term energy security, support U.S. jobs and economic growth, and reduced emissions. Thanks for the opportunity to testify, and I look forward to the discussion.

Mr. Byers, thank you. I know I heard the name Senator McCain invoked here a couple of times, and I think it was back in 2014 when Senator McCain had that famous line about Russia, just a great big gas station masquerading as a country. The more things change, the more they don't, don't they, in terms of still true today. And mentioning that Vertical Corridor today, the other exciting development you see long-term geopolitically is what's happening, in fact Senator Murphy and I are working on this on Central Asia with the Jackson-Vanik restrictions, but the, as Brzezinski once said, the Caucasus are the cork and Central Asia is the wine bottle. You know, popping that cork here with the Armenia-Azerbaijan peace agreement and now opening up an east-to-west flow now with energy towards Europe and the West is going to be another important part rather than seeing that energy flowing north or back to the east. Vice President Vance, in fact, will be in Yerevan and in Baku this week. So exciting things going on there, which are really in many ways breakthrough, pretty underreported around the world, but as we all know, have been watching this issue for a lot of years, progress, and that's why also Senator Murphy and I are just committed to getting those Jackson-Vanik restrictions lifted for those important Central Asia partners. As both of you know, the EU is looking at implementing its Corporate Sustainability Due Diligence Directive, or as you mentioned, Mr. Byers, the CS3D, a regulation that amounts to nothing more than regulatory extortion designed to drive American producers out of Europe or even out of business. Economic analysis that we have seen indicates that the full adoption of the regulation could cost up to 800,000 American jobs and over $1 trillion. These are massive numbers. While the regulatory omnibus passed by the EU Parliament last fall amended the CS3D to remove some of the more objectionable portions, the regulation still has the capacity to cause major damage to both Europe's energy security as well as global energy producers' ability to do business on the continent. Mr. Byers, could you tell me a little bit more about the potential economic impact of CS3D that you brought up part of in your testimony, as well as changes you might like to see to the regulation?

Yes, well, thank you for that question, Senator. It's a top priority for our members. I think the first thing I should mention about CS3D, it's economy-wide, so this is not just an energy regulation, it hits all sectors, automotive, banking, etc. And it is really remarkable and unprecedented in its reach. As I said in my testimony, it can reach not just to any company that has more than $1.5 billion of revenue into the EU, they don't even need to have an employee there. It forces them and their subsidiaries and suppliers to take certain measures to be consistent with EU standards in their global operations, not just their U.S. operations. So it can make a U.S. company liable for actions that are completely lawful in the United States, liable in an EU court. As you said, in December, and we were fortunate, the Chamber led a large effort alongside European business and industry to explain the harms of this to both Europe's competitiveness and the transatlantic relationship. So a number of very challenging provisions were removed, including Article 22, which requires net-zero commitments, not just a commitment, but an implementation plan for companies through their entire supply chains. So that has been, that's a very positive step, but the extraterritoriality that I mentioned, the reach into the U.S. operations remains, and so that's what we're going to continue to try to fix in the year ahead. And I will say, I think, you know, this has been recognized as a major non-tariff barrier, and we were pleased that in the trade agreement, the U.S.-EU framework trade agreement, it was, CS3D was explicitly called out as a hindrance, and so we hope there'll be continued cooperation to address extraterritoriality.

...part have delivered strong messages to Brussels and to European capitals about making adjustments on these provisions. And then I would also note that European companies, so the CEO of Total, the CEO of Siemens, together signed a letter a couple of months ago in October on behalf of 46 European companies calling for a full repeal of the CS3D. So I think European democracy is functioning on these issues and ultimately, I think the driving factor is Europe's determination never again to become dependent on Russian energy and the importance of the transatlantic energy relationship, which is also reflected in the EU-Europe trade agreement that President Trump reached with President von der Leyen last year.

Ambassador, you've spent a lot of time working on the ground in Europe. Based on your assessment in terms of the way things are shaping up there, do you think the Europeans are receiving those concerns well and will make adjustments accordingly?

I think so. I think there's clearly been an adjustment in the European level of ambition. As Senator Murphy said, I mean Europe is very clear. They want to find reliable, affordable energy with as you said yourself, Mr. Chairman, an all-of-the-above approach. But they've realized that to sustain all of their wind and solar power, they're also going to need that baseload supply. So US LNG is going to be a critical component of the European energy mix for decades and decades to come. So we have to get this right. And as I said, I'm confident from my own conversations both as a US government official and now as a private citizen that the European the European Commission also understands the importance of finding a middle ground on these issues because there's really not a good alternative. And so much of what's evolving in terms of the energy alliance between the United States and Europe is driven ultimately not by political proclamations on one side of the Atlantic or the other, but by market factors and the fact that as I said in my opening statement, that US energy, US LNG is the most affordable, reliable, and importantly the cleanest option. And maybe if I can make one other observation, especially on the issues around methane and climate impacts. It's important to recognize the leadership that American companies are demonstrating in this area. So American gas producers have become increasingly efficient in terms of using electricity for a lot of their production, in terms of monitoring and capturing and abating venting and flaring of associated gas. So there's just a there's a very strong alignment of interests here and I'm very confident that the officials who are now responsible for negotiating these issues will be able to find a constructive way forward.

Thank you, Ambassador. Senator Murphy.

Thank you very much, Mr. Chairman. Let me inquire on the flip side of this equation. I don't think it's a smart strategy for the United States to build our entire energy relationship on hopes that Europe is going to continue to import and need access to fossil fuels. Europe's made a commitment to renewable energy. That's real today as nearly 50 percent of their consumption comes from renewables. It's going to be even more true in the future. And so our relationship, I think, has to be built both with a knowledge that they are always going to need some access to fossil fuels and the United States can be a player, but that we are really disadvantaging the American economy if as Europe's share of power generation continues to move towards renewables, China rather than the United States is their primary partner for business. So maybe I'll ask Mr. Byers and Mr. Pyatt to both sort of speak to that. Speak to the fact that whereas a lot of time is spent on this committee now talking about LNG appropriately, I don't really understand what the what our president is doing in trying to hamstring our ability to stand up advanced battery technology, solar technology, wind technology and essentially cede that ground to the Chinese. They will become the preferred partner of Europe if we don't have an industrial policy in the United States that allows us to catch up. There's just no way that without an industrial policy, and you can tell me if you think I'm wrong, a combination of incentive and tariff, that we are going to be able to be competitive with China as Europe is bidding out a lot of work and a lot of product when it comes to renewables. So the question for both of you on that subject.

Yes, thank you, Senator, and I'll go ahead and start. I think you're absolutely right. We want to open markets into Europe for all technologies, all the above. We've got a lot of exciting investment and support from US companies and a lot of opportunity there. I think realistically, China has the market cornered on solar panels, you know, and so that's a supply chain where I don't know that there's a there's a pathway to come in. So I think we have to be strategic and targeted on where the opportunities are. Nuclear is a big one. We're really excited about opportunities in nuclear and Europe's sort of changing its attitudes there. We have thanks to your work on DFC, I think some, you know, exciting opportunities for support on nuclear. And I will say on gas, we watch this very closely just sort of overall energy demand and the market share that's expected in the coming years. Europe's going to need a lot for a long time and it's actually going to increase in the short term over the next five to 10 years, Europe's gas demand. And then once it peaks, it's going to probably plateau. So that supply gap, and this is by the way with assuming continued rapid build out of renewables because even in Eastern Europe, you're having continued economic growth and that's just leading to more energy demand. And if they adopt data centers, for example, in the same way that we are, they're they're way behind us on that, but if that starts to materialize in Europe the way it is in the US, the overall energy demand will also continue to stay higher than projected. And so, you know, we're going to need all the energy sources. You're absolutely right about that, but I think we have to be strategic about exactly where the best opportunities are for US companies to come in and sell products and technologies.

Senator Murphy, I agree completely. And I'll tell you a short story that I think illustrates the point. In September, I had the opportunity to go back to Kyiv. And I was there for the inauguration of Eastern Europe's largest battery storage facility. It was a project run by DTEK, a private energy company, using technology from a company called Fluence. Fluence is headquartered just across the river from us in Boston. And I went to go talk to the CEO there when I came back from Kyiv. It's a fantastic story. Fluence is an American champion in the battery energy storage space. Their main competitors in the market today are BYD and CATL, two of the Chinese state-supported companies that are operating in battery storage. DTEK went with Fluence because it was American technology, but they also delivered a competitive price. And importantly, DTEK is now taking exactly the same Fluence battery product and they are developing in Poland. So it's absolutely vital that we remain competitive across all of these spaces. I would second Dan's point as well on nuclear and especially SMR. When I was in government, tremendous, tremendous interest across Central and Eastern Europe on SMR opportunities in Bulgaria, in Romania, in Poland, and certainly in Ukraine. And here we have a number of American developers. And I think I remember I used to say with my counterpart, Eliot Kang, when Eliot was Assistant Secretary for Nonproliferation and we were thinking about these issues, the global market for SMR development outside the US is going to be decided in Central and Eastern Europe because that's the place where you have a huge hole that needs to be filled to replace electrons that formerly came in the form of Russian gas.

One of the advantages we do have over China is the fact that generally when you're dealing with the United States and with US companies, you are dealing with above-board transactions, whereas when you're dealing with the Chinese or many other suppliers, you are often required to pay bribes, to deal with under-the-table requests. I mentioned in my opening remarks and I'll ask this question to you, Ambassador Pyatt, there's news coming out of the Balkans that suggests the Trump administration is pushing on Bosnia a particular partner to help them build a critical interconnection. And this partner seems to be run by two individuals who have no history in actually producing energy projects, but who were supporters of the president's attempt to overturn the 2020 election. I'm not you're free to comment on this particular what appears to me to be grift, but at the very least, maybe offer thoughts on how important it is for the United States to make sure that we aren't pushing political cronies on countries overseas, that we aren't engaged in the same kind of corruption that China is. This seems to me to be corruption. And projects like this where we're pushing friends of the president who are woefully unqualified to do the work seems to be the kind of thing that will push other countries towards China, not towards the United States.

So Senator, thank you for that. Let me answer it two ways. First, I would underline the point that the energy sector is particularly capital intensive. Most projects run in the billions of dollars and they all take many, many years to roll out. I lived through this during my six years in Greece as I was working on the Southern Gas Corridor, a project that began under my predecessor as Assistant Secretary, three times removed, Dick Morningstar. And it took us almost 20 years to get that project done and it's going to take decades for that project to return the value that was invested into it, but it was hugely important in terms of unlocking Southern Europe's dependence on Russian gas supplies. So this is a sector where industry and the market has to look behind beyond simply a four-year election cycle in the United States. And so having that consistency of purpose that we have enjoyed in this area through Republican and Democratic administrations engaging in Europe on energy diversification and on US reliability is tremendously important. And it's even more so because of what we started talking about today, which is the fact that we're only in the first years of what is going to be a fundamental remapping of Europe's energy infrastructure. For several decades, as Chairman Daines noted in his opening statement, Europe made the mistake of anchoring its energy security strategy on cheap Russian gas. That has now thankfully come to an end. It's a tragedy that it took an invasion of Ukraine and millions of casualties to make that reality sink home in Europe, but I am confident today that Europe will never again look to Russia as a reliable energy supplier. But we need to be there for the long term, working with Europe with our best companies operating in a transparent and above-board way. And we also have to maintain trust because as I learned through 35 years as an American foreign service officer proudly representing this country, that trust is the coin of the realm when you're involved in diplomacy. And so building that kind of long-term confidence in the way that hearings like this and a bipartisan message from the Hill can do is of tremendous importance.

Senator Barasso. Thanks so much, Mr. Chairman. Ambassador, good to see you again. A couple quick questions. You know, American energy resources have been a lifeline to our allies in Europe. Last month, the United States supplied 60 percent of the European Union's liquefied natural gas. Since Russia's invasion of Ukraine in February of 2022, the US has exported over 3,000 cargoes of liquefied natural gas to Europe. To put it into perspective, one cargo of LNG provides enough heat for about a million people in Europe for one winter month. So do you believe the United States is a secure, reliable, and strategic energy partner?

Absolutely, unequivocally.

And what additional efforts can the United States take to help our allies increase their energy security?

So I think first and foremost, Senator, we need to keep doing what we're doing. We need to continue to expand America's industry and I talked in my opening statement about the tremendous accomplishment of American producers who have more than doubled America's liquefaction capacity in recent years. I also think we need to find a way to keep talking about the issues around climate and the environment. I had the opportunity for the first time in my life late last year to be in Lake Charles, Louisiana. And I was there with the governor and with a number of our biggest LNG producers, but I was also there with some of the Europeans. And they had spent the day before our conference visiting CP2 and some of the other LNG facilities around Lake Charles. And they all said to me one version or another of, wow, I expected something that looked like, you know, that looked industrial with flares and rusty chains, and I saw something that looks more like a high-tech manufacturing facility. And I think telling that story. And if I can make one other share one other anecdote in this area. I had the opportunity as Assistant Secretary to travel in Western Pennsylvania and visit some of the fracking pads operated by a great Pennsylvania company, EQT. And what was most striking to me about that visit, when you see what our gas producers are doing in the Marcellus region, you know, these are these are people who are incredibly proud of the work they're doing, but they're also producing sometimes within a mile or two of farms and schools and communities. So they're incredibly attentive to issues like methane and flaring and how to produce their goods in the cleanest way possible. We should be proud of telling that story.

I want to switch to uranium if I could because as you know, for years Russia has dominated the global uranium market. As of 2024, Putin controlled roughly 40 percent of the world's enrichment capacity, supplied nearly a quarter of America's enrichment enriched uranium. So I worked on a bipartisan basis to enact a prohibition on Russian uranium imports into the United States, which takes full effect in two years from now. European nations remain even more dependent on Russian nuclear fuel but are now trying to reduce that reliance. As the West shifts away from Russian nuclear fuel and global demand rises, what kind of strain does that put on our European enrichment capacity?

So I would highlight two issues on this, Senator. First of all, I would applaud what you and others did to implement a legal ban on imports. And I remember sitting in this very chair being asked by Chairman Risch about this same issue and it's tremendous to see the action. And I think it was also important that Congress included in its ban on uranium imports provision for a circular fund to help capitalize the investment that we're going to have to make in order to build a non-Russian supply chain. But I would also flag importantly that as we see a new generation of nuclear reactors and if our scientists and engineers are successful with building out an SMR infrastructure, we're going to need greatly increased volumes of nuclear fuel supply. So that means uranium. It connects with what Chairman Daines talked about in terms of Central Asia, the role of Kazakhstan, for instance, as a major uranium supplier. And then just like every other mining and mineral issue here in the United States, where do we source both the ores but also the processing that makes these commodities usable in this case for nuclear power.

So then the question is how important is it that our own Department of Energy prioritize building out more US enrichment capacity for not only domestic use but also to support our allied nations?

Critically important. Last night, I had the opportunity to have dinner with the head of one of Japan's largest utility companies in Osaka. He was here, he had actually visited the he spent two days in the United States visiting some of our nuclear reactors and Japan of course is looking at a new generation of nuclear reactors after having spent 15 years since the Fukushima disaster shutting down facilities. He was incredibly enthusiastic about what he saw happening here in the United States, but we have to build partnerships with the Japanese, with Korea, with Canada, with our European allies. And I should emphasize I talked in my opening statement about the REPowerEU initiative and the tremendous progress that Brussels has made in committing to phasing out of Russian energy. And that includes gas, oil, and importantly nuclear. So Europe is going to have the same exact dilemma that our operators of reactors have here in the United States.

Thank you. Thank you, Mr. Chairman.

Senator Barasso, thank you. And mentioning Kazakhstan, back to Central Asia here for a moment. Turkmenistan has the fourth or fifth largest natural gas reserve in the world. It's one of these little-known facts. Again, as we open up that east-west corridor, it could be very important here as we think long-term about energy security. Ambassador Pyatt, there've been a number of European countries that have pursued investments in energy that will create, we believe, long-term stability for their grids. Greece, you're an expert on Greece. They announced last year that they'll be starting a new offshore gas drilling project for the first time in 40 years. Croatia, another bright spot in Southeastern Europe. Their Krk floating regasification terminal has opened up 6.1 billion cubic meters in annual gas supply, fully offsetting their prior reliance on Russian gas. For the last decade, the Baltic states have been working to cut all ties with Russian energy. And we're seeing the full development, as you mentioned, Ambassador, of the vertical corridor. So here's my question, Ambassador Pyatt. Do you believe that these projects represent a change in sentiment of the EU bloc or are these solely strategic investments being made by the countries most threatened by Russia?

So Mr. Chairman, I think these projects first and foremost are a reaction to the huge wake-up call that Europe received at the end of 2021 and the beginning of 2022 when Putin demonstrated his willingness to use energy as a weapon against the European Union. And I can remember vividly conversations with German and other officials who insisted that Russia would never cut off supplies because Russia needed the European market. But in fact, Putin saw energy cutoffs as an essential element of his strategy for destroying Ukraine. And as Senator Murphy alluded to, he thought that Europe was going to cave. And I would give the Biden administration tremendous credit for the work we did, including the LNG task force that was agreed between President Biden and President von der Leyen, and then a lot of on-the-ground work with our LNG producers to make sure that Putin would fail in that effort. So now I think you see a new generation of investment. I would put a particular spotlight on the leading role that American companies are playing in this area. So for instance, it's ExxonMobil, which is working on the the Greece project that you alluded to. Chevron is playing a leading role offshore of Cyprus, offshore of Israel, offshore of Egypt, working to build energy opportunities to feed into that European market. And I hope that our companies will continue to play an important role, which is another reason why as Dan said, we've got to get CS3D right because this is a this is one important element of what remains despite all of the frictions and I was in Davos two weeks ago and you know the level of anxiety around Greenland was off the chart. But over the long term, you have trillions of dollars of trade and investment that flow across the Atlantic Ocean. And so we need to find a way to continue to reinforce that partnership and it's the private sector investments in both directions, European companies investing in energy here in the United States and American companies investing in energy in Europe that are going to help to stabilize that relationship in the years ahead.

Along that investment comment you just made, do you think there's an opportunity for targeted investment or financing from the Development Finance Corporation or EXIM Bank that might help facilitate other projects?

Absolutely. And I was so grateful that Senator Murphy mentioned the work that he did with Senator Johnson on the NDAA in 2019, which gave DFC authorization to work in Greece when I was ambassador. That turned into a $125 million investment into a shipyard that otherwise would have gone to China. And there are there is potential for DFC to do more on the vertical corridor, to do more on transmission lines, to do more on gas storage, hopefully to do more also on battery storage, which is going to be such an important part of the story for Europe and for the United States as we seek to stabilize our grid in an all-of-the-above environment where we are also going through a supercycle of expanded demand.

Senator Murphy.

Thank you very much. Just one final question and keep you on the spot, Ambassador Pyatt. You really have been our sort of most adept and capable ambassador over the last two decades turning around the US relationship in Greece, but then also helping to midwife Ukraine through its most turbulent, troubled time. On Thursday, January 26, the president announced that Putin had agreed to pause attacks on Kyiv and other cities because of the freezing temperatures. Obviously, Russia's directing attacks at Ukraine's energy infrastructure. And then on February 2, just a few days later, the biggest attacks of the year came, attacking Ukraine's energy infrastructure. A bunch of us, Democrats and Republicans, got a closed-door briefing yesterday on the situation in Kyiv and it's dystopian right now, the fact that there is virtually no electricity that is reliable amidst a winter that is already off the charts with respect to record cold. Instead of criticizing Putin for these attacks, President Trump tried to explain it away, saying that the moratorium on attacks had been secretly postdated and in fact what Putin was doing was outside the moratorium instead of doing what any human would have done, which is to talk about the immorality of making families and children freeze deliberately. That's a that's a war crime. I just want to ask you, what do you see as the path forward to try to shore up in the short term Ukraine's energy infrastructure? They're not through this awful winter. It probably will just harden their resolve to continue the fight. Air strikes very rarely have the intended effect, which is to cow a population into acquiescence. But what should our role be as a Congress and as a country to help stop this deliberate assault on Ukraine's energy infrastructure? What are some next steps to get us out of this moment?

Thank you, Senator Murphy, and I think you put it very well. I would just emphasize first and foremost your point about the humanitarian catastrophe that Putin is inflicting on Ukraine today. It's about minus 20 degrees in Kyiv right now. The situation is extremely difficult and we need to understand Putin is attacking civilian energy infrastructure, conducting what is unambiguously a war crime because he is failing on the battlefield and he is trying to break the will of the Ukrainian people. I am very confident that he will fail in that regard, but we need to be doing everything that we possibly can to help them in that regard. First and foremost, we need to call it out for what it is. I was very glad to see Senator Graham and others speaking out in exactly these terms this week. Second, I think it's important that the United States continue to find whatever resources we have available that can be brought to bear to source the materials that Ukraine needs to keep the lights on. When I was in government, I led the G7+ task force that was created by Secretary Blinken in order to support Ukraine's energy infrastructure. I had a team of officials in the Energy Bureau that was working every single day to find transformers and switchgear and generators and working with all of our allies. That's an effort that generated more than $5 billion of equipment, most of which was not paid for by the American taxpayer and a lot of which was sourced from American manufacturers. I understand that there are still certain accounts that are floating out there which related to the demise of USAID, IECA funds and others that could be channeled for this purpose and I hope that that will happen quickly.

But just underscore that. USAID was a critical player for a long time in helping to shore up Ukrainian energy infrastructure, correct?

USAID, Department of Energy, and the State Department's Energy Bureau under Secretary Blinken's directive. And I must say, it's a source of great satisfaction to me that when I go back to Ukraine, that effort is still very well remembered precisely because it touches every single Ukrainian civilian.

Senator Graham's comments were strong, but he is not the president of the United States. He is not the Secretary of State. We need the White House to be condemning the war crimes that Putin is committing rather than as President Trump was, excusing or explaining them away. But appreciate your comments. Thank you.

Senator Murphy, thank you. We're going to wrap this this hearing up by just was thinking as we were exchanging thoughts here today. It's worth thanking the Indian government for their agreement on Monday to continue to reduce and end their Russian oil imports. I was over in Delhi two weeks ago working with the leaders there in India and was glad to see President Trump, Prime Minister Modi come to agreement on that trade deal, but importantly India's work to continue to reduce its dependence on on cheap Russian oil. Without objection, today's complete agenda as well as all written statements and letters that have been sent to the subcommittee will be included in the record. Sincere thank you to our witnesses today. I think we had a thoughtful back-and-forth, thoughtful dialogue on some very serious issues that are facing Europe in providing us with the benefit of your testimony. For the information of members, the record will remain open until close of business tomorrow. We ask that witnesses to respond as promptly as possible. Responses will also be made a part of the record. With the thanks of the committee and a warm thanks to my ranking member, Senator Murphy, this hearing is now adjourned. [Gavel sounds.]