Course:ECON371/UBCO2011WT1/GROUP8/Article 7:What tar sands and the Keystone XL pipeline mean for climate change
What Tar Sands and the Keystone XL Pipeline mean for Climate Change
Article 7: What Tar Sands and the Keystone XL Pipeline Mean for Climate Change
Summary
The purposed 1600 mile long Keystone XL Pipeline has the largest green civil disobedience campaign in a generation. The pipeline would transport oil from Alberta to refineries in the Gulf of Mexico. Overall if the pipeline were to be put in place an increase in amount of CO2 in the atmosphere would result and make carbon emissions higher from tar sands than conventional oil. On June 15th, 2011 the bill to expedite a decision on the pipeline was approved.
In order for the project to proceed, President Obama needs to approve it – and currently, the protests taking place are aimed to convince him to reject the project.
Environmental Impacts: The project requires that trees need to be cleared, which will inevitably destroy the boreal forest. Plus, large amounts of water will be used up and polluted which can cause aquatic life deformities downstream. There were always be concerns with oil spills and leaks. For example in a similar project, Keystone I, there was 12 spills over a period of less than a year.
Greenhouse Gas Emissions: The energy required for steam injection and refining is currently produced from natural gas, which emits more GHG emissions per barrel than the final product of conventional oil. Compared to conventional oil production, tar sands emit 10-45% more GHG and according the US Environmental Protection Agency (EPA) tar sands emissions from the well to the tanks are 82% higher than conventional oil.
Keystone Pipeline Emissions: There are many concerns regarding the Keystone Pipeline, this just being one of them: "recognizing the proposed Project 's lifetime is expected to be at least fifty years, we believe it is important to be clear that under at least one scenario, the extra GHG emissions associated with this proposed Project may range from 600 million to 1.15 billion tons CO2-e, assuming the lifecycle analysis holds over time"
Overall, there will be more emissions emitted than conventional oil through this project and exploiting the tar sands could be detrimental, but the USA has not taken very many concrete steps to minimize its GHG Emissions. This goes to show that before the project is put in action, GHG Emissions need to be reduced to that conventional oil sources aren’t the best option.
Economic Analysis
Tar Sands development has led to the release of many harmful contaminants including lead, mercury, cadmium, zinc. The release of these contaminates have exceeded the provincial and federal regulations and the guidelines regarding the protection of aquatic life have been out ruled. The Federal Fisheries Act 1868 says to stop the discharge of harmful contaminants but the zero discharge policy could only be regulated if the marginal damage function lies above the marginal abatement cost function for all possible levels of emissions. Contaminants are being dumped into the rivers and lakes which are poisoning the drinking water. There have been many cases of water contamination in Alberta and it seems that government is unable to tackle this problem. Now, the problem with such contaminants are that they are persistent that remain for a long period of time, either because they are non-degradable or because the rate of degradation is very slow. It is really difficult to measure how much pollution the industry is producing and the damage it is doing to the environment. The use of technology based system or setting up emission standards could be fruitful if the emissions are occurring at a low rate. But the tar sands development emissions are huge. Taxes could be imposed on those materials which lead to the pollution here rather than discouraging such activity the Canadian government is rather subsidizing out the oil firms and are much concerned with profits rather than the environmental degradation.
A reoccurring theme in different articles about the oil sands is the greenhouse gas emissions caused by extracting bitumen. There is a lot of uncertainty in the data and the impacts caused by the greenhouse gasses however, there is no argument that the greenhouse gas emissions from the tar sands are huge. On one hand there are arguments that well-to-wheels emissions are only 10 to 45% more then conventional oil, while the US Environmental Protection Agency (EPA) states that well-to-tank emissions are 82% higher. It is important to note the difference in the calculations; the well-to-wheels calculation includes the emissions caused by the combustion of the final product where as well-to-tank only includes emissions used to get the gas to the pump. By incorporating the final emissions it increases the total emissions making the percentage of emissions caused from extraction seem smaller. It is interesting how the companies and opposition use the different calculations to their advantage. With the varying emission statistics it is very hard to pinpoint the marginal abatement costs and therefore do an economic analysis. What is clear, is the lack of government regulation. While regulation is a provincial responsibility, it is important for the federal government to step in due to the transboundary issues with air pollution and the fact that the oil sands is such a specific industry. Because the oil sands are remotely located, the region’s air quality meets the national ambient emissions guidelines even though they are producing heavy emissions.
Prof's Comments
It would seem that a tax, to adjust for the extra carbon emissions with a higher price on this type of fuel would be the best policy.
Discussion wanders, without much development of the concepts.
6.5/10