Neither side is right in the polarised debate over the Keystone pipeline, argues Jon Entine

To deconstruct the debate over the Keystone XL pipeline, pick your ideology.

Marching in the shadow of the White House, Daryl Hannah, Naomi Klein and dedicated antagonistas framed the choice as environmental destruction or clean energy. They ended up in jail. Aiming to take office in that same building, Tea Party-besotted Republicans pose the conflict as liberal regulatory overreach against jobs and energy security. For the most part they were celebrated as realists. Both perspectives are caricatures.

According to the liberal case, extracting oil from tar sands in Alberta, Canada, is infinitely more harmful than drilling for conventional crude. And they say the pipeline will leak.

“Exploitation of tar sands would make it implausible to stabilise climate and avoid disastrous global climate impacts,” says Columbia University climatologist James Hansen. “If tar sands are thrown into the [world energy] mix, it is essentially game over.” Al Gore adds: “Gasoline made from the tar sands gives a Toyota Prius the same impact on climate as a Hummer using gasoline made from oil.”

They are blowing hot air bullhorns. While extracting Alberta crude generates 200% greater emissions than extracting conventional oil, over the well-to-wheels life-cycle, the difference is 5-30%. A Hummer on conventional fuel is four times dirtier than a tar sands fuelled Prius.

If we triple the current extraction rate, it would take 1,000-2,000 years to deplete reserves. If world oil demand continues unabated for that long, climate challenges remain the same with or without Alberta’s oil. As for the pipeline, its pathway through the US would follow routes already carved for traditional pipelines. Today there are 500,000 miles of oil and gas pipelines in the US, with minimal safety issues. There’s nothing unique about Keystone.

Rightists are no less disingenuous. Proponents claim Keystone will result in an energy bonanza, radically reorienting geopolitics, and protecting the US from hostile cartels.

But there isn’t a genuine danger the flow of oil will ever be cut to the US. As Michael Levi at the Council for Foreign Relations has written, the existence of the Strategic Petroleum Reserves ensures no cartel could cut off supplies. A tar oil boom would, though, result in small power recalibrations. Regional access to oil would reduce the leverage of current adversaries such as Iran, Russia and Venezuela.

The real challenge in this debate is to deconstruct the tension between environmental protection and regulations. The question of “jobs” is a political football. As a rule, businesses focus on costs and profits, while environmental groups care little about costs and economic benefits.

The jobs questions

Corporatistas claim Keystone would help rejuvenate the US economy. Republicans intimidated Barack Obama into dropping clean air regulations by loudly arguing that environmental protection is a job killer. Trying to leverage that “victory”, the American Petroleum Institute says the project would add at least 20,000 jobs.

Claiming that the government should override all environmental concerns for such a paltry haul of jobs spread over a decade is pathetic justification. It’s not even clear that killing the pipeline would cause job losses.

In one of the few real life case studies of the employment impact of environmental regulations, industry complained in the 1980s that controlling acid rain would cost $7.5bn and tens of thousands of jobs. According to Resources for the Future the regulations ended up costing $1bn and have led to a net gain in jobs.

So where do we go from here? It’s reality-check time.

For the right: the Alberta reserves, no matter how massive, won’t reorder the world energy security map or pull North America out of its economic doldrums.

For the left: the Canadian government will not abandon this multi-trillion-dollar project if the US does not build the pipeline. It would be built through British Columbia, financed by China if need be. That would mean higher prices with similar climate impacts. As for global warming, oil sands production accounts for less than 0.1% of global greenhouse gas emissions, which might grow to 1% (a fraction of the paper and pulp business) at full production.

Considering the meagre role that the Alberta oil actually plays in the big climate change picture, blocking this project is an inefficient way to mediate global warming. Yes, we desperately need carbon taxes and/or cap-and-trade regulations combined with fuel conservation measures. But targeting a fossil fuel project until alternative energy becomes economically viable doesn’t promote those goals; it just turns the debate into farce.

As Michael Levi has written, if Alberta oil comes on line, “a consistent price on carbon … would create a simple economic incentive to cut emissions without coming anywhere close to shutting down expansion altogether … That would let Congress and the administration focus their attention on the more pressing matter of our own emissions, which are 200 times larger than those of the oil sands.”

The real question we need to be asking is not “who’s right?” but “what’s feasible?”

Jon Entine is a senior fellow at the Center for Health & Risk Management at George Mason University/STATS and founder of the sustainability consultancy ESG MediaMetrics


How to manage social & environmental risk for oil, gas and mining North America

November 2012, New Orleans

Best practice in stakeholder engagement, implementation and reputational risk and opportunity for the extractives industry from the likes of; Anglo American, Rio Tinto, Debeers, ExxonMobil, Calvert Investments and more

Related Reads

comments powered by Disqus