Develop Renewable Energy, Not the Keystone XL Oil Pipeline

Summary.  TransCanada, the sponsor of the Keystone XL pipeline project, filed an updated application for approval with the U. S. Department of State.  The Department issued a Draft Supplemental Environmental Impact Statement evaluating the application.

It addresses many immediate environmental concerns focusing on the pipeline route and its environmental integrity.  This post focuses on a more fundamental issue.  It restates the opposition of this blog to approval of the pipeline because if granted, the project would ensure a long-term commitment to continued and prolonged emissions of carbon dioxide, a principal greenhouse gas.

The energy economy is likened to a zero-sum enterprise, balancing investments in conventional carbon-based fuels for energy, worsening global warming, and developing renewable energy sources, improving the global climate.  The longer mankind accumulates higher and higher levels of atmospheric greenhouse gases, the worse global warming and its harmful effects on humanity become.  It behooves all nations to abate emissions and migrate to a carbon-free energy economy, sooner not later.  Accordingly, it is recommended to deny the XL permitting application.

Background.  The Keystone XL oil pipeline (XL) is an international transport pipeline project intended to carry bitumen (Alberta tar sands oil) from the Canadian border to refineries on the U. S. Gulf Coast.  Its sponsor is TransCanada Keystone Pipeline, LC.  Since the project has an international aspect, involving oil transport across the Canada-U.S. border, it requires positive review by the U. S. Department of State (DOS) and approval of the President.  The query to be resolved is whether approving XL is in the national interest.

         A first approval request was considered in 2011 with inconclusive results.  The proposed route passed over important subterranean aquifers in Nebraska.  The DOS Environmental Impact Statement (EIS) generated at the time dealt extensively with this issue.  Ultimately concerns over the susceptibility of the pipeline to failure leading to contamination of the aquifers led to failure to approve the project.

TransCanada has modified the proposed route through Nebraska to reduce  potential contamination of aquifers.  In addition, a portion of the original pipeline project from Oklahoma to the Gulf Coast is now under construction, as it does not require approval by the Administration.  The revised application has resulted in a Draft Supplemental EIS (SEIS) prepared by DOS in March 2013.  After formally releasing the SEIS in April 2013, any interested party may submit comments (see Note for details) for consideration and possible response before the final SEIS is issued.

         Tar Sands.  The oil available in Alberta is a surface-accessible mixture of a thick oily substance with the consistency of tar, called bitumen, with sand and clay.  Bitumen must be heated with hot steam to liquefy it, permitting separation from the minerals mixed with it.  Before shipping, bitumen is further refined to provide a synthetic crude oil suitable for pipeline transport.  Alternatively, bitumen can be diluted with liquid hydrocarbons to permit it to be pumped in the pipeline as well.

The Provincial Premier of Alberta, the province in which the tar sands are located, visited Washington, D.C. for the fourth time in 18 months during the week of April 8, 2013.  Alison Redford came to lobby for favorable action on XL.
 

Manmade global warming has become a serious problem in recent decades.  Mankind’s burning of fossil fuels, and other industrial and agricultural practices, are generating ever-increasing amounts of greenhouse gases that are released into the atmosphere.  These accumulate because most carbon dioxide, the product of burning, and some others of the gases, remain in the atmosphere for long times.  There is no natural mechanism that removes these gases once emitted.  They remain active, accumulating to create a more intense greenhouse effect, for a century or longer.  It is the total accumulated burden of greenhouse gases, not their annual rate of emissions, that governs the intensity of the greenhouse effect.

The Draft Supplemental Environmental Impact Statement.  This post discusses aspects of the SEIS presented in the Executive Summary.
 

The American portion of the pipeline under review extends from the Canadian border in Montana, traverses South Dakota and Nebraska and ends at Steele City, NE.  This portion is 875 miles (1408 km) long and 36 inches (91 cm) in diameter.  It will carry Canadian tar sands bitumen.  A branch, carrying shale oil from North Dakota, and other crude oils, will join it.  Its total capacity is intended to be 830,000 barrels per day, of which 555,000 barrels per day is currently committed to transporting Canadian bitumen.  Ultimately the sources of the oil stocks it will carry would be determined by market decisions. 
 

The SEIS devotes extensive attention to potential localized environmental effects, especially in the case of leakage.  These have been amply addressed elsewhere, including the SEIS, by both proponents of the pipeline and its environmental opponents. 

Construction of the U. S. portion of XL is estimated to cost US$3.3 billion for directly incurred expenses.  Direct employment during construction would be about 3,900 full time jobs over the 1-2 years envisioned for construction.  Once operating XL would need fewer than 50 employees.  The construction site is a moving front progressing along the route, requiring a 110 foot wide right of way during construction, which would be restored to a permanent 50 foot right of way upon completion, amounting to 5,584 acres (2,259ha) of land.  It includes 44 valve stations and 18 pumping stations along this segment. 

Climate change impact of XL.  The Executive Summary reports that operation of the proposed XL project is expected to lead to the emission of about 3.2 million metric tons of CO₂-equivalent per year of operation, mostly devoted to generating the electricity to operate the pumping stations along the pipeline.  The SEIS states this is comparable to the energy requirements of about 626,000 gas-powered cars, or about 398,000 homes using electricity, for one year. 

These figures account only for the operational emissions of the XL Project under review.  The full length of the U. S. portion of the pipeline from the Canadian border to a Gulf Coast terminus is about 1,700 miles, or almost twice the length of the proposed Project.  So the numbers in the preceding paragraph should be approximately doubled to account for transporting tar sands bitumen from the Canadian border to a Gulf Coast refinery. 

In addition, on a life-cycle basis extracting and refining of Alberta bitumen is more energy intensive than that of conventional oils, releasing about 17% more CO₂.  As noted above in the Background section, this is because of the extra heat energy needed to liberate the bitumen from its mineral composite.

This writer has estimated the CO₂ burden arising from actual combustion of tar sands bitumen, in the presumed form of gasoline, petroleum coke and other products of refining.  Depending on assumptions made, this estimate may have an error of perhaps 15%.  The result obtained is about 100 million metric tons of CO₂/year resulting from burning the full complement of bitumen proposed for transport by XL.  [Update 04/23/13:  This XL-derived annual emissions forecast represents about 4.5% of total CO₂ emissions for 2011 originating from burning petroleum-derived fuels in the U. S., according to data from the 2013 Annual Energy Outlook of the U. S. Energy Information Administration (Table A18), excluding international marine (bunker) fuels,]

 

Analysis

 

This blog has opposed the XL pipeline for a fundamental reason, one little argued by others.  It should be the policy of the U. S. to accelerate the transition of our energy economy away from one dependent on carbon-based fuels toward one that relies on renewable energy sources that do not emit greenhouse gases.  As pointed out in many recent posts, this should be done as soon as possible. 

Long Lifetime of Emitted GHGs. A major fraction of CO₂, the main greenhouse gas, emitted into the atmosphere remains there for at least one century and probably longer.  (Natural processes remove the minor portion, but cannot accommodate the full amount emitted.)  Thus atmospheric CO₂, and other manmade GHGs, will keep accumulating more and more until the rate of emission approaches zero.  This higher level of atmospheric GHGs worsens global warming and all its harmful effects on the planet and to mankind.  Thus early steps toward decarbonization of the energy economy are needed.

President Obama addresses climate change.  President Obama has proclaimed his support for efforts to combat global warming in both his Second Inaugural Address and his 2013 State of the Union address.  An important signal backing up his policy would be denial of a permit for XL.  This is because of the major additional annual rates of emission of CO₂ over the long term that its operation entails, as detailed above.  Transnational transport and burning of Canadian bitumen and its refined products would contribute about 106 million metric tons of CO₂ each year, for the full operational lifetime of the pipeline, i.e., for several decades.  The U. S. should take a policy stand that it will not be responsible for, or condone, such continued emission of GHGs, but rather that it will instead support deployment of renewable energy sources.

Pronouncements by TransCanada and the Alberta Premier are contradicted by their  actions.  The SEIS, presumably relying on declarations made by TransCanada, notes that it may not matter whether the U. S. approves the XL application.  Production of bitumen in Alberta and of crude oil in North Dakota would continue.  It states there are alternative modes of transport, involving other pipelines, rail, and truck, to carry Canadian bitumen to the Gulf.  Other destinations are also noted but were not evaluated. It also points out that the Gulf refineries already receive crude oil for processing by tanker transport from other sources.

Even so, TransCanada is actively campaigning for approval of XL and is laying groundwork for the Project.  For example, Mary Pipher, a Nebraskan opposed to the Project, points out in the New York Times of April 17, 2013 that TransCanada is using threats of exercising eminent domain (legal expropriation of property) against landowners along the XL right of way.

Alison Redford, the Premier of Alberta, has visited Washington, D.C. four times in the last 18 months seeking favorable action on XL.  During her most recent visit, she declared “We’re an exporting economy,” saying that Alberta’s bitumen would be harvested regardless of the approval of XL. “Alberta does have other options,” such as Canada’s Atlantic or Pacific coasts (New York Times, April 9, 2013).

The actions by TransCanada, described by Ms. Pipher, and the persistent campaigning in the U. S. by Premier Redford, clearly show that these interests are not ambivalent about the final decision on XL.  They are heavily invested in the outcome, and apparently actively pursue a favorable outcome.  To grant approval would further set back mankind’s pursuit of decarbonizing our energy economy by condoning continued fossil fuel use.

 

Conclusion: The energy economy is a zero sum enterprise.  In weighing whether to approve the Keystone XL pipeline, the choice is not whether to approve it or simply to reject it. Rather the correct decision to consider is whether to prolong the fossil fuel energy economy or to expand our renewable energy economy.

As noted above, the pipeline, if built, commits us to continued atmospheric emissions of CO₂ from this oil over its full service lifetime, i.e. 40 years or more.  [Update 04/23/13:  This represents about 4.5% of emissions from petroleum use in the U. S.]  The longer we delay to abate emissions, the harder it becomes.

The alternative strategy is to shift the investment that would be going into projects such as the pipeline into developing industrial scale, renewable energy sources and energy transmission infrastructure instead. We should stop harvesting tar sands oil and build wind farms and solar farms instead, and should reject new oil pipelines in favor of new transmission lines from those farms to energy consumers. The US$3.3 billion investment envisioned for the XL Project segment could develop significant renewable energy facilities such as these.  In this way, the overall energy economy is preserved, job demand remains vibrant, and global warming is addressed in a meaningful way.

[Update 04/23/13:  Cynthia Giles, Assistant Administrator for Enforcement and Compliance Assurance of the U. S. Environmental Protection Agency (EPA) commented on the SEIS in a letter to DOS dated April 22, 2013.  The comments identify aspects of the SEIS that are inadequate and require further analysis or support.  These include (among others) first, the 17% or higher greater emission of GHGs required to produce Alberta bitumen compared to a range of crude oils from conventional sources.  The letter requests an assessment of overall social costs for this increase.  Second, the letter requests a more thorough market analysis supporting the SEIS conclusion that regardless of whether the Project is approved Alberta bitumen production will not change significantly.  Third, the letter requests further details on how the U. S. and Canada can cooperate to mitigate GHG emissions in the production of bitumen (including carbon capture and storage) and possible use of renewable energy to power the operation of the pipeline.  These and other failings in the SEIS currently preclude the EPA from approving the XL Project.]

 

Note
 

Public comments on the SEIS may be submitted

a) by email to keystonecomments@state.gov,
 

b) using the internet at http://www.keystonepipeline-xl.state.gov/, or
 

c) by mail to:

U.S. Department of State

Attn: Genevieve Walker

NEPA Coordinator

2201 C Street NW Room 2726

Washington, D.C. 20520.

 

© 2013 Henry Auer

The EU’s Emissions Trading Scheme Has Been Voted Down

Summary.  The European Union instituted its Emissions Trading Scheme, using a cap and trade mechanism, in 2005.  Since that time, the Scheme has gone through periods in which the number of allowances was too high, resulting in excessively low values for their price. 

In a vote on April 16, 2013 the European Parliament defeated a proposed measure continuing to allot allowances to the emissions sources among the EU’s member nations, largely for economic reasons.  If allotments are not revived, the ETS will cease operations.  This would terminate one of the first multinational efforts to mitigate greenhouse gas emissions.
 

The ETS exemplifies the administrative and political difficulties facing cap and trade regimes.  Valuing carbon emissions is better achieved with a carbon fee.

 

Introduction.  The original members of the European Union (EU) in 1997 acceded to the Kyoto Protocol, an international treaty to limit emissions of carbon dioxide (CO₂) and other greenhouse gases (GHGs).  The Protocol entered into force in 2005.  Even before this date the now expanded membership of the EU undertook to establish an Emissions Trading Scheme (ETS) to limit GHG emissions through 2020, using a cap and trade market mechanism.  In such regimes allowances, once granted, can be traded or auctioned in an open market; this fixes a monetary value for them.

In the initiation phase of the ETS the EU allowed each member nation independently to establish the number of allowances (each permits release of one metric ton of CO₂).  As a result, too many allowances were granted, and the ETS market wound up valuing the allowances at a very low price, even approaching EUR 0 in one year.  In the second phase (2008-2012) the number of allowances granted was reduced, and the ETS market valued allowances at reasonable levels.  In the third phase, beginning in 2013, the EU began centrally to determine the distribution of allowances.

Unfortunately, the EU cancelled its most recent auction   in March 2013 because bids received were “significantly” below the actual market rate.  In 2013, the start of Phase 3, about 40% of newly issued carbon emission allowances were being sold at auction for the first time.  The rest are still distributed at no charge.  The price had fallen to EUR3.73 (US$4.86) a metric ton early in the year.  The price had been about EUR 25 in 2008.

Longer term the ETS price for emission allowances has fallen drastically, by 90%, in the last five years.  This is due largely to a drop in demand for energy among EU countries because of recessionary conditions.  This has led to an oversupply of allowances.  The ETS began to reevaluate its allocation of allowances, in an attempt to rebalance the trading system and maintain a price on emissions.

Unfortunately the EU has now voted against its cap and trade regime.  The New York Times reported on April 17, 2013 that the European Parliament had voted not to lower the number of carbon dioxide emission allowances to be granted going forward.  The Times called the result “a potential death blow” to the cap and trade emissions regime.  Even so, emissions from the EU had fallen by 10% between 2007 and 2012, at least partly because of weak economic conditions.  The Parliament gave greater weight to the desire to keep energy costs down in view of the economy than to the overarching need for the world to limit its emissions of GHGs.  After the vote, the value of an allowance fell 40% to about EUR 3 per metric ton.  It is estimated that in order to have an effect on curtailing emissions, the price would have to be about EUR 30 per metric ton or higher. 

Analysis

This blog has long advocated in favor of a direct fee on carbon fuel consumption, rather than implementation of a cap and trade regime, to put a price on emissions of GHGs and thereby lower the annual rate of GHG emissions.  This latest development in the EU, the failure of its policymakers to continue the ETS, shows that a cap and trade regime may continually be subject to political interference.

As written in a recent post a cap and trade regime has many disadvantages in comparison to a carbon fee.  Some of these are apparent when considering the EU.  The factors include a) a need to account accurately for baseline emissions from each identified source prior to placing the regime in operation; b) a continued need for monitoring emissions from each source as the regime operates; c) a need for a  mechanism to allot allowances both at the outset and in subsequent periods of operation; d) a mechanism or rule for distributing allowances, including determining whether to grant or sell them; and e) setting up the administrative offices needed to operate the regime.  It is seen from this incomplete list that a cap and trade regime presents many challenges, requires an extensive bureaucratic structure, and includes many opportunities for mistakes to be made, or for influence, that defeat the objective of constraining emissions.

In contrast, a carbon fee is extraordinarily simple in its operating features and is easy to implement.  For example, a low rate could be established at the outset, which would increase annually to a level at which it would have a meaningful effect in reducing energy demand.  Experience has shown (not discussed here) that a carbon fee is easy to apply, has a broad if not universal reach, and achieves its objective according to its magnitude.  It is clear that the simplicity and effectiveness of a carbon fee offers major advantages over use of a cap and trade regime.

Many commentators have urged use of a carbon fee to mitigate emissions. 

 

In summary, the simplest, most direct, and most effective mechanism for reducing dependence on fossil fuels and mitigate emissions of GHGs is to apply a carbon fee.  The time to begin abating humanity’s emissions of CO₂, a major greenhouse gas, is now.  The longer we wait, the more firmly we cement our dependence on fossil fuels, and the more difficult it will be to achieve meaningful mitigation of global warming.

 © 2013 Henry Auer

Americans Support Expansion of Renewable Energy, Surveys Show

Summary.  Public opinion surveys in the U. S. show that more than two-thirds currently think there is solid evidence that the earth is warming.   The surveys find the public supports expansion of renewable energy.  A majority of Republicans among survey respondents are included in this supporting class.  One survey reports that Republicans believe their elected representatives do not “care much about” what they think about climate change. 

Policymakers should respond to poll results such as these and coalesce around efforts to expand renewable energy.  Many policy justifications exist to support this position.

 

Introduction.  Climate scientists from all around the world overwhelmingly agree that manmade greenhouse gases have contributed significantly to increased long-term global average temperatures over the last several decades.  They foresee a future by the end of this century, and beyond, having profoundly higher temperatures and consequent harmful impacts on human welfare and planetary climate conditions.  The substance of these projections of future harms has not changed since the first report from the Intergovernmental Panel on Climate Change in 1990. 

Policymakers around the world, especially those representing countries that are major emitters of greenhouse gases, have been unable to arrive at an agreement for a meaningful reduction in these emissions.  Nevertheless, in the U. S. the public has gained increased appreciation that global warming is an issue that needs to be addressed.  This post summarizes some recent public opinion surveys of attitudes toward global warming.

Pew Research Center surveys over the first months of 2013 are summarized here.  Their survey in February 2013 found that 69% of Americans think there is solid evidence that the earth’s average temperature has been increasing in recent decades.  The trend for this question since 2006, as well as for the question of whether warming arises mostly because of human activity, is shown in the graphic below, which includes survey results from March 2013.

 

Survey results over 2006-2013 showing the percent of Americans thinking that the earth is warming (top, bronze) and that the warming is due to human activity (bottom, gold). 

Source: Pew Research Center; http://www.pewresearch.org/2013/04/02/climate-change-key-data-points-from-pew-research/.

 

The graphic above shows that American public opinion bottomed in 2009-2010, both on whether the earth is warming, and on whether warming is due to human activity, and has increased significantly since then.  American belief that humans have caused global warming has consistently been at least 20% lower than agreeing that warming is occurring at all.

There is a dependence of attitudes about global warming in the U. S. on affiliation with a political party or outlook.  The Pew survey in March 2013 shows that U. S. Democrats (more liberal) are far more likely than U. S. Republicans (more conservative) to agree that global warming is occurring, and that it is due to human activity (see the table below).

 

Dependence of attitudes about global warming on political identification.  “Rep”, Republican; “Dem”, Democrats; “Ind”, politically independent or unaffiliated.

Source: Pew Research Center;  http://www.pewresearch.org/2013/04/02/climate-change-key-data-points-from-pew-research/.

 

There is also a stark division by political affiliation about whether Americans regard global warming to be a problem, according to a Pew survey from October 2012.  A majority of Democrats believe it is a very serious problem, but only one-fifth of Republicans do.  Conversely, only 1 in 6 Democrats believe global warming to be either not too serious a problem or not a problem at all, whereas more than half of Republicans fall in these two groups.

 

Gallup Poll results show that there is strong support for renewable energy in the U. S. across the political spectrum.  A survey of 1,022 subjects in all 50 states gave results having a 95% confidence level with a ±4% error.  Respondents were given a choice of placing more emphasis, less emphasis, or about the same emphasis, as currently done for supplying our energy needs from various sources.  They chose “more emphasis” by large margins for solar power (76%), wind (71%), and natural gas (65%), with much lower preferences for more emphasis for oil, nuclear energy and coal.  Breakdowns by party affiliation in this survey are shown in the following table.

Source: Gallup poll, March 2013. http://www.gallup.com/poll/161519/americans-emphasis-solar-wind-natural-gas.aspx

 

It is seen that Republicans strongly support more emphasis on solar power, wind, and natural gas, but also oil.  About half of Republicans further support more emphasis on nuclear power and coal.  Democrats, on the other hand, overwhelmingly support more emphasis on solar power and wind energy, with less than one-third supporting oil, nuclear power or coal.

 

Climate Change Communication project.  George Mason University’s Center for Climate Change Communication and Yale University’s Project on Climate Change Communication have been collaborating on the attitudes of Americans on global warming over the past several years.  They released a new report on April 2, 2013 providing results of a survey of U. S.Republicans on the subject of climate change.  938 people who had identified themselves as Republicans or Republican-leaning independents in a previous survey taken in Fall 2012 were called back in January 2013 for this survey; 77% of those agreed to participate.  Important findings are summarized here.

More than half of Republicans surveyed think that climate change is happening.  52% agreed, 26% did not agree, and 22% didn’t know.

A large majority supports expanded use of renewable energy.  These Republicans support much more (51%) or somewhat more (26%) use of renewable energy.  (In the survey, “renewable energy” consists of solar, wind and geothermal energy.)  Most of these (69%) felt measures should be started “immediately” toward this objective.

The survey also probed this issue from the converse perspective. 51% of Republicans indicated that the U. S. should use fossil fuels (i.e. coal, oil and natural gas) somewhat less (31%) or much less (21%) than today.  Only 22% favored increased use of fossil fuels, giving a ratio of about 2.5 to 1 favoring less use. 

Perceived benefits of reducing use of fossil fuels outweighed perceived “costs”.  (As seen below, “costs” does not refer to monetary costs, but to social and economic factors.)  Respondents could choose more than one from among 9 listed benefits and 6 listed costs.  The three benefits chosen most frequently, among 538 of those surveyed, were “help free us from dependence on foreign oil”, “save resources for our children & grandchildren”, and “provide a better life for our children & grandchildren”.  The benefit listed as “limit climate change” was next to last.  The two highest perceived costs chosen among 477 of respondents were “lead[ing] to more government regulation” and “caus[ing] energy prices to rise”.

After having weighed the benefits, costs, and other factors 64% of Republicans think “we SHOULD take action to reduce our fossil fuel use”, whereas 35% think “we SHOULD NOT take action” (capitalization in the survey as reported).

Perceptions of politicians’ responsiveness to people.  The Republican respondents showed an apparent skepticism or alienation concerning their ability to influence political decisions.  More than half  “do not think elected officials care much about what people like me think about climate change”, and think “people like me don’t have any say in what the government does about climate change”.  Only 8% think “elected officials pay a lot of attention to the views of people like me” on this issue.

 

Analysis

 

Surveys from three different polling organizations are summarized here.  Polling results can be partly influenced by the way that poll queries are phrased.  Yet the poll results reinforce one another quite consistently, making clear that overall they reflect the thoughts and feelings of the American public.

 

Americans favor expanding support and/or development of renewable energy sources such as wind, solar and geothermal energy.  The reasons given for this widened support cover a broad range, including achieving energy independence and expansion of a new economic sector with its attendant growth in job opportunities.

 

In the U. S. Congress, Republicans have opposed development of renewable energy.  There may be many factors contributing to the development of policy positions among legislators, including responsiveness to the wishes of constituents, sensitivity to economic interests, and development of support for retaining elected office.  In this regard it is significant that the survey results from all three polling organizations show that respondents who identify themselves as being avowedly Republican or favoring Republican positions strongly support development of renewable energy sources.

 

Among Republicans responding to the Climate Change Communication survey more than half think climate change is happening, and three-quarters of them support more or somewhat more use of renewable energy.  After weighing perceived benefits vs. perceived socioeconomic costs about two-thirds of Republicans surveyed think we should act to reduce use of fossil fuels. The Pew and Gallup surveys found comparable support among Republicans.  Anecdotally, the New York Times reports on April 9, 2013 that the Republican mayor of Lancaster, CA, a desert community with plenty of sunshine, is undertaking to install sufficient solar photovoltaic capacity to generate more electricity than his city needs.

 

The Climate Change Communication project found that of the Republicans surveyed more than half felt alienated or ignored by their elected representatives.  If this is a valid representation of attitudes held by the officials, it suggests they pay more attention to other considerations than to taking the opinions of their constituents into account.

 

Conclusion.  Polling shows that the fraction of Americans that thinks global warming is occurring, and that human activity is a cause, is growing in recent years.  The majority of Americans think growth of renewable energy sources should be supported.  More than half of Republicans, and in certain surveys many more, are included among those supporters.  Many reasons, most having to do with national security and economic factors, are identified for this support.  Explicit identification of global warming or similar environmental concerns is low on this list.  Elected officials who are our policymakers at the national level should pay heed to survey results such as these.  They should support expansion of renewable energy sources for all the reasons mentioned in the Climate Change Communication survey.

 

 © 2013 Henry Auer