149.4 - Update: Keystone XL pipeline

Update: Keystone XL pipeline

I have two updates regarding the Keystone XL pipeline

About a month ago, I talked about the State Department's Final Environmental Impact Statement, or FEIS. I slammed it on a couple of bases, one of which was its conclusion that Keystone would not significantly affect the overall level of greenhouse gas emissions - greenhouse gases, of course, being those that cause global warming - because if the pipeline isn't built, the oil simply will be transported by other means.

I said the State Department was trying to change subject, to focus solely on the physical structure of the pipeline without regard to what would be in it and I later criticized the assumption that the gunk would just be sent another way.

The word "gunk" was chosen deliberately, by the way. Just as a reminder, we are talking about transporting tar sands, about the dirtiest, most polluting way to get oil there is, from Alberta, Canada to refineries in Texas. This stuff is so thick, so sludgy, that you have to in effect melt it and mix it with water just to get it to a point where it's able to flow through a pipeline.

Well, now the Carbon Tracker Initiative, which is based in the UK and focuses on how carbon budgets interact with financial markets, has looked at that same State Department conclusion and thought the same thing I did. Except, of course, they could back it up with detailed analysis, not just intuition

According to that analysis, The State Department's final environmental impact statement downplays the significance the pipeline would have for development of the Canadian tar sands and therefore underestimated the amount of greenhouse gas emissions that would come with that development.

In short, the State Department concluded that approval or denial of any specific project to transport oil, including Keystone XL, is unlikely to significantly impact the rate of extraction in the tar sands. But Carbon Tracker calls this the "significance trap." The pipeline is only deemed insignificant because the State Department's report didn't consider the ways the pipeline would affect production of the tar sands.

Grossly oversimplifying for the sake of brevity, shipping by rail costs more than shipping by pipeline. So including transportation costs, the cost per unit of production, the cost per barrel of oil produced, is higher shipping by rail than by pipeline, which would tend to hold down production. If you have the pipeline, your transportation is less, so the unit cost is less, so you can produce more (and so make more profit) for the same investment.

Carbon Tracker estimates that oil companies could produce as much as 525,000 more barrels of oil per day out of the tar sands if they have access to the Keystone XL pipeline.

Which means the pipeline would be responsible for generating a whole lot more emissions than the State Department accounted for because it would be facilitating more rapid development of the tar sands, which would create its own emissions in turn.

What's more and what's worse, other research has shown that in all of the Keystone-generated-emissions scenarios that were considered in the State Department's report, none of them - not a single one - would meet the US's declared target of cutting greenhouse gas emissions by 17 percent below 2005 levels by 2020. The emissions estimates are also not consistent with the goal of limiting global warming to no more than 2 degrees Celsius, which is generally agreed to be the upper safe limit; in fact they are consistent with trends that would see a 6 degree Celsius - nearly 11 degrees Fahrenheit - rise in average global temperature by the end of the century, a level of heating reasonably described as disastrous.

So fortunately, there is some good news to be found in the other update on the pipeline.

The process by which the route for the Keystone XL pipeline through the state of Nebraska was established involved taking the authority for making the decision away from the state’s Public Service Commission and giving it to Gov. Dave Heineman, who gave the TransCanada Corp., the folks who want to build the pipeline, permission to build on private land.

Now, a state court judge has ruled that that process was illegal.

So as of now, unless a higher court reverses the decision, TransCanada may have to reroute the entire pipeline or else seek permission from every single landowner whose property it would cross. That could set the whole schedule back for at least a year. And frankly, the more delay, the more the opposition to this thing increases and the more opportunity it has to increase.

I still think Obama wants to approve the thing if he can find a way to do it without generating too much backlash from his environmentalist supporters. But I am getting a little hopeful - just a little, but still hopeful - that we can actually kill this thing.

Sources:
http://www.carbontracker.org/
http://www.huffingtonpost.com/2014/03/03/keystone-xl-emissions-state-department_n_4892806.html?icid=maing-grid7%7Chtmlws-main-bb%7Cdl26%7Csec1_lnk2%26pLid%3D450211
http://www.carbontracker.org/wp-content/uploads/2014/03/Kxl-The-Significance-Trap_FINAL_03_03_2014.pdf
http://priceofoil.org/2014/02/17/kerrys-state-department-ignored-obamas-climate-action-plan/
http://www.salon.com/2014/02/20/nebraska_just_made_things_a_lot_harder_for_keystone/