Contributed by Robert Lyman @ August 2016 – Energy economist.
On Saturday, August 20, 2016, a coalition of environmental groups in Eastern Ontario will demonstrate in Ottawa to oppose Trans Canada Pipeline’s proposed Energy East Pipeline project. Like previous campaigns waged against the Keystone XL Pipeline and others in Canada, the information being disseminated and endlessly repeated by Ecology Ottawa and many of the other organizers is blatantly wrong and misleading, and the exercise itself represents an attempt to severely politicize a decision-making process that should be left to the National Energy Board.
It would take a book to adequately explain all that is wrong with the opponents’ objections to Energy East. Within Canada, the main substantive claims come down to two – that the construction and operation of the Energy East Pipeline will threaten the quality of water supplies and that building additional oil pipeline infrastructure will harm the global climate.
Alleged Threats to Water Quality
The effects of a pipeline on the water quality along its route will be determined by several factors, the most important of which include the route chosen, the design of the pipeline, the special precautions taken by the pipeline operator to avoid, detect and respond to any spill that might happen, the likely size of the spill, and the diligence of the regulators that approve the initial construction of the pipeline and regulate it throughout its operational life. It is extremely unlikely that any of the environmentalists who will demonstrate on August 20 have any expertise in these subjects. The National Energy Board is an independent, expert, quasi-judicial regulatory body that will review these facts and come to a recommendation for the federal Cabinet.
Are pipelines safe in general? There are hundreds of thousands of miles of oil pipelines now operating in Canada and the United States, most of which underlie rivers, streams, lakes and wetlands of all kinds and sizes, and have done so safely for many decades.
Opponents love to focus on the worst possible cases of potential oil spills and present these in their propaganda as the most likely cases. This is, of course, flagrantly dishonest, but they seldom get called out for doing it. In fact, oil pipelines are by far the safest way to transport oil and refined products. According to the Canadian Energy Pipeline Association, between 2002 and 2012, over 99.999% of oil transported by pipeline in Canada was delivered safely and without incident. During that period, 14 pipeline accidents occurred involving the release of crude oil. Of these, 57% involved the release of less than 6 barrels of oil; 14% between 6 and 160 barrels; 21% between 165 and 6,300 barrels, and 1% over 6,300 barrels.
Trans Canada Pipelines (TCPL) has committed that the pipeline will be designed, built and operated in ways that meet or exceed industry standards. In operation, it will be monitored 24 hours a day, 365 days a year from TCPL’s operations control centre. It will use a leak detection strategy using multiple real-time leak detection methods including real-time transient modeling, pressure-flow monitoring, software-based line balance checks, in-line inspections, and periodic aerial and ground monitoring.
Alleged Effects on the Global Climate
If one accepts the thesis that catastrophic climate change may be caused by human-made GHG emissions, how much difference to the world’s emissions would be made if the Energy East pipeline were not built? This can be demonstrated in percentage terms. Canada produces 1.6 % of global GHGs. All current oil sands production accounts for 6.5% of Canadian emissions. The emissions associated with the oil that would be transported by Energy East would, at most, represent about 20% of the production from the oil sands. If you multiply those figures (i.e. 1.6 x .065 x .2), you can calculate that the production of oil for the Energy East project would contribute 0.02% of global emissions. In other words, it is one five thousandth of annual global emissions. That is much less than the rounding errors used for statistical analysis. So, in the worst case, the emissions that would be avoided by rejecting the Energy East project can hardly be measured.
What difference does one pipeline make in global terms? Despite the recent decline in oil prices, infrastructure investment is booming. In 2015, 1,115 miles of new crude oil pipelines were constructed in the United States and 352 miles in Canada out of a global total of 1,886 miles. Crude oil pipelines under construction now that will be completed in future years total 3,885 miles in the United States and 2,968 miles in Canada out of a global total of 10,626 miles. Total onshore oil and natural gas pipeline construction worldwide in 2015 totaled more than $40 billion. The people of North America and the world are demonstrating that they want access to modern energy services and do not believe the radical environmentalists’ rhetoric.
The opponents of this one pipeline among the many others being built in the world today do not seem to realize that 85% of the emissions associated with the oil fuel cycle occur at the final consumption, or tailpipe, stage. The U.S. Energy Information Administration recently projected world oil consumption to increase by 36% above 2010 levels through 2040, with demand growth strongest in the less developed countries, and especially in China and India. With lower oil prices, the demand increases may be even faster.
Energy East is a $15.7 billion investment, 100% privately financed. It would create thousands of person-years of employment during the construction stage and billions of dollars in revenue for the federal and provincial governments over its operating life. It would reduce Canada’s oil imports by 566,000 barrels per day and increase our oil exports by almost as much, thus significantly improving our balance of payments. This means nothing to the pipeline’s opponents, but it should mean something to those who care about Canada’s people.
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