Last week China announced an overhaul of their environmental policy. The new rules include stricter regulations on polluters and easier pathways for people to report polluting companies.
The change is a drastic move from the old mantra of “growth at all costs” to “environmental protection as the country’s basic policy.” In recent years, smog in cities and chemical pollution on agricultural lands and in drinking water have sparked protests in major cities around the country.
As many of the people worry about health concerns from over-polluting, the fact still remains that China will not want to decelerate economic growth too much. They have already committed $280 billion towards cleaning their air.
The new regulations, which don’t go into effect until next January, will put tougher limits on utilities companies to cut their fossil fuel pollution. Natural gas could serve as a cleaner alternative to the dirty coal that powers much of China’s economy.
This is good news for natural gas companies like Cheniere Energy (NYSE: LNG) who will likely be able to start exporting natural gas from its Sabine Pass terminal in Louisiana at the end of 2015.
Once LNG tankers start sailing out of U.S. terminals, investors with exposure to the right natural gas plays will be perfectly positioned for the real profits in this long-term energy boom.