Course:ECON371/UBCO2011WT1/GROUP8/Article 3: Alberta-Ottawa Revamp Oilsands Monitoring as World Watches
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Alberta-Ottawa Revamp Oilsands Monitoring as World Watches
Summary
This article talks about the monitoring control system, environmental limits and new regulations regarding the oil sands development. The new proposed XL pipeline project has become highly controversial which would be bringing up more bitumen. In order for this project to be more sustainable there needs to be a world class monitoring. There seems to be no political will to set out environmental limits to this project. The federal and provincial governmental are cutting out their environmental budget. There are currently 5 separate monitoring programs having data which goes back to 1970.These monitoring teams are there to measure heavy metal and hydrocarbon concentration, temperature, turbidity and oxygen content. Both the provincial and federal government is trying to improve the transparency so that the data is more available to the public. The provincial government is trying to figure out the impacts so that limits can be placed. They are determined to set up a early warning system program so that necessary actions can be taken before the Industries exceed the pollution limits. Limit doesn’t mean a stop in growth but making this project more efficient, innovative and creative in order to continue with this project. The improvement to the monitoring system means that it would be costing heaving on the governmental as the estimated cost per year is $50 million whereas the federal and provincial governments have cut down their environmental budgets. If the government is willing to put something in action they need to increase their budget so that environmental regulations are more strictly enforced.
Economic Analysis
When examining the environmental impact of a region with surrounding oil sands, there comes a point in time when you have to consider natural contamination and industrial contamination. Untangling the sources of the contamination is a very difficult procedure.
There has been lots of research done about the facts of environmental damage, however the results have not been made public. Dan Wicklum, Environment Canada's director of water science, says: “It's a world-class resource and it needs a world-class monitoring system to assure us that the resource is being developed sustainably and responsibly.” There has been talk about new environmental limits and regulations, however Edmonton and Ottawa are currently cutting their environmental budgets and looking at each other to ‘run the show’ of regulation.
Currently there is five separate monitoring programs in the region. Two governmental programs, one industry and third parties, including on that has data going back to the 1970’s. However, we believe that by pooling their resources and data together they could be more efficient and as a result come up with more precise findings about the damage caused by the industry rather than just from natural contamination. Once they determine the factors causing the main source of pollution from an industrial standpoint, we believe they can introduce either a pollution permit or tax pertaining to that specific area of the industry. This way they will not confuse natural contaminants with industrial pollutants making it a fair trade for companies. But then comes the issue with non-uniformly mixed emissions. It would be more costly to separate the emissions produced by industrial parties to determine which company produced each pollutant present. There are many factors that make it difficult to establish the ‘birth site’ of each and everyone pollutant, but by at least separating natural and industrial contaminations the government can get a better picture as to where tax or pollution permit should be applied.
It is said that improving the oilsands will cost more, an estimate $50 million a year more, which will be funded by industry because the governments are looking to cut their environmental budgets. Overall the federal plan is quite similar to Alberta’s plan regarding growth of the oilsands yet still keeping environmental regulation in mind. But when is comes to environmental monitoring, there are too many factors up in the air to make a decision to limit pollutants without hurting the economy.
Prof's Comments
This article hits on a couple of issues we have talked about in class. One is property rights and the other is the role of information. The article mentions that Alberta is 'jealously' protecting its jurisdiction. This is an important thing to bear in mind in this issue. How does this impact on the efficiency? Are there externalities beyond Alberta's border? Another is the importance of this monitoring information to locating the MD curve. If we don't know the impacts, we don't know the MD. Then we can't pick the efficient level. A final issue is why are we cutting back on monitoring? Whose interests are served here?
7/10