Pres. Barack Obama vetoed a bill to approve construction of the Keystone XL Pipeline on February 24—not because of climate change, not because of low oil prices and not because of the risks from leaking diluted bitumen from the tar sands. Obama vetoed the pipeline bill "because this act of Congress conflicts with established executive branch procedures." In other words Obama used the third veto of his presidency to preserve the prerogatives of his office, in this case evaluating cross-border pipelines and the ever-vague "national interest."
There is little doubt that oil made from the bitumen stuck to sand buried beneath Alberta is among the dirtiest kinds of oil found on the planet. Interestingly, about the only worse type of petroleum is the heavy crude from Venezuela that refineries on the Texas coast already process—the same facilities that Keystone aims to reach. And that's just the climate accounting, which leaves out very real health impacts on local people and communities as well as the boreal forest, rivers and lakes of Alberta.
But there is little doubt that without Keystone XL, less tar sands oil will find its way out of the ground and, perhaps more importantly, will not be as cheap—and in a time of low oil prices that may prove to be the difference.
Every bit of infrastructure must be accounted for in some kind of global ledger as either adding more or adding less CO2 while in use. Such energy transitions take decades but there are obvious swaps, like substituting anything for coal or using less of the tar sands.
Opponents of the proposed Keystone XL pipeline from Canada to Texas may have another arrow in their quiver. A new study funded by the U.S. Department of Energy found crude extracted from Canada’s oil sands region leads to greenhouse gas emissions that are 20 percent higher on average than emissions from conventionally produced U.S. crude.
President Barack Obama, who has the final say on the pipeline’s approval, has said he won’t green-light the project if it significantly exacerbates global warming pollution. Critics have dubbed the Keystone XL a carbon bomb because Canadian oil sands crude requires extensive amounts of energy to extract, process and refine compared with other types of crude.
Last month, the historically ultra-conservative and oil-rich province of Alberta, Canada, did the unthinkable: It elected a left-wing government. And that new government just made one of its first big moves: It announced a serious clamp-down on climate change.
“We need a climate change plan that is bold, ambitious, and will bring Alberta into a new era of responsible energy development and environmental sustainability,” Environment Minister Shannon Phillips said Thursday. “If we get it right, our environmental policy will make us world leaders on this issue, instead of giving us a black eye around the world.”
According to Phillips, the province will double its carbon tax. In other words, it will ask oil companies and other high-emitting industries to pay double what they’re paying now for pumping greenhouse gases into the air.
In addition, Phillips announced the creation of an advisory panel to review Alberta’s entire climate change policy, with the goal of making a preliminary pledge to reduce emissions at the COP21 United Nations Climate Change Conference in Paris at the end of this year. That conference is widely seen as the last chance for a global agreement that could feasibly limit global warming to 2°C.
Alberta is home to the tar sands, a type of oil that requires one of the most carbon-intensive extraction processes in the world. The province has come under fire from environmentalists for that process, which produces as much as three times the greenhouse gas emissions of conventionally produced oil. Canada is the world’s fifth-largest oil producer, and about 78 percent of that is produced in Alberta.
Phillips said that the current carbon tax of $15 per ton would double to $30 per ton by 2017. The carbon tax as a whole was set to expire, but instead of letting it, she said Alberta would renew and strengthen it.
CALGARY, Alberta (Reuters) - TransCanada Corp TRP.TO said on Tuesday that tightening climate-change rules from the governments of Canada and the province of Alberta help justify the construction of the controversial Keystone XL pipeline project.
The company, Canada's No.2 pipeline operator, released a letter sent to U.S. Secretary of State John Kerry and other department officials saying that increased carbon levies for Alberta oil sands producers and new Canadian targets for greenhouse-gas emission cuts should serve to help assuage U.S. concerns that approving the C$8 billion ($6.41 billion) project would increase climate change.
TransCanada has waited more than six years for the Obama administration to make a decision on whether it would allow the embattled project to proceed, frustrating Canadian oil producers and governments eager to see the country's oil reach the high-paying refinery hub on Texas' gulf coast.
However, Obama has said he will only permit the project, bitterly opposed by environmental groups in both the U.S. and Canada, when he is certain it will not significantly exacerbate climate change.
In the letter, Kristin Delkus, TransCanada's general counsel, said there have been significant new developments in Canadian carbon policies since Obama announced the policy. Delkus highlighted Canada's new targets to cut greenhouse-gas emissions to 70 percent of 2005 levels by 2030.
Along with noting other policy changes, Delkus also highlighted new emissions rules in the province of Alberta, whose carbon-intensive oil sands are the largest single source of U.S. crude imports.
Alberta is doubling the cost of excess carbon emissions to C$30 ($24) per tonne by 2017 as it studies additional measures to cut output of greenhouse gases.
"Any decision on the pending Presidential Permit application should take all of these factors and developments into account," Delkus said.
The Keystone XL project would take 830,000 barrels of oil per day from Hardisty, Alberta, to Steele City, Nebraska, where it will join the project's existing southern leg to the Texas coast.
The State Department could be immediately reached for comment.
Recently, Canada and the other G7 countries made an important commitment to end fossil fuel use by 2100. This is significant because it demonstrates a larger trend—the change in the energy supply mix from fossil fuels to more renewable energy resources. In the interim, natural gas will continue to play an increasing role, and all this is bad news for companies like TransCanada Corporation (TSX:TRP)(NYSE:TRP), which has a $46 billion capital program largely focused on expanding oil pipelines.
Just recently, Economist Jeffrey Rubin stated that projects like Keystone XL or Energy East “aren’t worth the paper they’re printed on” due to the fact that oversupply of oil combined with lack of future demand (as renewable energy and natural gas become more dominant) will result in production declines.
The numbers seem to confirm this trend. In 2013 renewable power growth exceeded growth in new capacity for all fossil fuels combined, with 143 gigawatts of renewable power generation capacity being added compared to 141 gigawatts for fossil fuel resources. By 2035 four times more renewable capacity will be added, and oil is expected to be the slowest growing major fuel, growing only 0.8% annually and having market share decline from 32% to 28%.
With the energy mix changing rapidly, should TransCanada shareholders be worried about the relevance of the over $20 billion in oil pipelines being proposed for the next five years? Fortunately, TransCanada is investing heavily in the energy mix of the future.
TransCanada is investing heavily in liquid natural gas pipelines
TransCanada is also investing heavily in clean energy
TransCanada is Canada’s largest private sector power company, and this position alone provides the company with tremendous opportunity to not only diversify its asset base, but to capitalize on changing energy trends. Currently, one-third of the companies generating capacity comes from emissionless sources, and this is only expected to grow as the company invests more in solar, wind, hydro, and nuclear power.
It's not just about oilROCKMAN wrote:And as far as the left leaning Albt. Govt imposing a higher carbon tax how does that reduce emissions? The companies would simply pay and it would be added to the cost of doing business just as all the development costs are factored in to the price the oil buyers have to pay. It would increase govt revenue but would a single bbl of oil sands not be produced because of it?
This is supposed to be an incentive for bitumen companies to reduce emissions, somehow. The thinking seems to be that if Alberta has a "serious" CO2 policy, then Obama will approve KXL. I know your views on "we don't need no steenkin' KXL border crossing" but I think there are safety, economic and capacity issues with rail and other alternatives.Alberta was one of the first places in the developed world to implement a carbon tax in 2007, with a policy that contributes proceeds from the levy to a technology fund. Premier Rachel Notley’s government, elected in May, has said the province needs to be a leader in climate policy in order to support the oil-sands industry that has been criticized for its environmental impact.
“We need to reduce our greenhouse gas emissions with a plan that is real,” said Environment Minister Shannon Phillips in a briefing with journalists. “We were not taken seriously and with this, that will change.”
Technology, energy efficiency and renewable energy are key to future emissions reductions, Phillips said.
The existing carbon regulations applied to about 45 percent of emissions in the province, with coal-generated power plants accounting for the greatest amount of CO2 output. A total of 6 million tons of CO2 emissions will be eliminated over the next two years because of the new regulations, the ministry said.
FASTER REDUCTIONS
With the new regulations, large emitters will be required to reduce emissions by 15 percent next year and 20 percent in 2017, compared with a 12 percent reduction this year.
Notley will build on efforts begun by her predecessor Jim Prentice to rehabilitate the tarnished reputation of Canada’s oil-sands industry. The planned expansion of crude output has been hampered by a lack of export pipelines like Keystone XL and opponents that have focused on the higher carbon emissions of extracting and processing bitumen, a thick fossil fuel mined or steamed out of underground reserves.
http://www.bnn.ca/News/2015/6/25/Albert ... -2017.aspx
An infantile case of denial IMHO.
Yeah, like that.ROCKMAN wrote:Keith - “The thinking seems to be that if Alberta has a "serious" CO2 policy, then Obama will approve KXL." You mean a serious CO2 policy like ...
Five reasons environmentalists distrust you
The mistrust comes from several directions:
1) Climate change has not been your issue. You've focused your greatest attention on issues you came to early in life -- things like education and health care -- all of which are crucial. But climate change feels like a late add-on. You know the topic because you're whip-smart, but only as a topic; if you really felt it, then the obvious connections with the things you do care about would be apparent. One sees a glimmer of it sometimes: the campaign for better cookstoves in developing nations combines all your deepest cares with important environmental issues. But you could go much deeper. Study after study shows that climate change is hitting vulnerable communities the hardest -- just look at asthma rates in the U.S. and superimpose that on a map of where the coal plants are.
2) You were terrible on Keystone. Even before the State Department began its review of the project, you said you were "inclined" to approve it. That's been your last public word on the project, but your team performed an intellectually corrupt review of the plans, your campaign bundlers landed rich lobbying contracts, and your former advisers took jobs with Transcanada. It was and is a huge mess -- and I'm sure you hate the whole topic because at the start you couldn't have known that it would become the iconic environmental issue of our era. Since pipelines until Keystone were routinely approved, it probably seemed like just a chance to please the Canadians. Had you known it would become a hornet's nest, you would doubtless have proceeded more carefully -- and in fairness it wasn't until the process was underway that climate scientists raised their most forceful concerns. Still, ugh.
3) You took the Obama administration's affection for fracking and ran with it. Working with a deep team of oil company advisers, you set up a whole office at the State Department whose job it was to push fracking all over the world (Cambodia, China, New Guinea); you gave speech after speech in country after country. This was bad policy in the extreme: America, at best, struggles to keep fracking from poisoning its water, and even with our regulations on drilling, massive quantities of methane leak out. So now imagine how well it's going to work in, say, Romania, where your ambassador pressured the government to turn over millions of acres for shale gas development (before returning to work for Chevron's law firm).
4) As the world's top diplomat, you presided over the monumental failure that was the Copenhagen climate conference in 2009. Six crucial years were lost as a result. Enough said.
5) All that endless money. The right-wing attacks on the endless speaking fees and foundation gifts aren't actually just a concern to the right wing. The banks backing Keystone, just to give one small example, have been regular and enormous patrons. It's not illegal, any of it, and it's not quite the same as the way the Koch brothers simply purchased the GOP, but it's not far enough away, either. Influence is ... influence.
Seven ways you could win some green stripes
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