If politicians truly believe that human habitation is in jeopardy due to climate change, it will drive them to prevent many economic activities – ones that, for now, keep America prosperous. There are unknowns involved – just how global warming will affect us is prime among them. The Democratic presidential candidates all oppose the pipeline project; by rejecting the project has Obama neutralized the pipeline as a political issue?
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It should be noted that President Barack Obama’s stated reasoning for nixing the Keystone XL Pipeline included environmental concerns, lack of need for the “dirty” product being carried, quality of resultant jobs and most importantly his global image as he pursues beneficial climate change projects.
In the oil sands, companies have found ways to reduce per-barrel GHG emissions by 30 per cent since 1990 and continue to seek more reductions through technology development.
Now that the Keystone XL pipeline has been rejected, it’s not a foregone conclusion that much of the 830,000 barrels a day that would have flowed through it will move on trains instead, industry watchers say. According to economist Steven Moore, for every penny gasoline prices drop, Americans save $1 billion. But for President Obama, the balancing factors are clearly the criticism he would receive from the Sierra Club, the hostile tweets that might be directed at him by the greens, and the money that a handful of green billionaires might redirect to the Clinton Foundation rather than Mr. Obama’s own post-presidential aspirations.
The number of permanent jobs the project would create is in dispute.
Keystone XL could very well make a meaningful contribution to America’s long-term economy.
And the oil will be refined into fuel and burned. Oilsands output is slated to be stepped up in the years to come, reaching 2.8 million barrels a day in two years’ time from 2.5 million this year. The proposed pipeline would have delivered oil produced from oil sands in Alberta cross-border to Nebraska.
Holdout landowners not interested in letting TransCanada build a pipeline on their properties provided another source of local opposition.
But even if the pipeline stood a good chance of flopping, that’s not something a president should consider in deciding whether or not to grant a permit.
In its environmental impact assessment, the State Department correctly concluded that the pipeline would pose no threat to public health or safety.
“I think that rail certainly will play a part, but a lot has to do what happens to the price of crude and happens to oilsands projects”, said Dirk Lever, an analyst at AltaCorp. President Obama’s choice on Keystone XL added momentum to this push forward.
It’s only been within the past year that we’ve seen proposed steps to combat climate change from the president.
With a powerful global climate treaty set to be finalized early next month, the president appears to be trying to lock in his environmental legacy. The federal government is also phasing in higher fuel-efficiency standards while throwing a few weight behind renewable-energy initiatives.
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But for the gusher of new oil – and the resulting drop in gasoline prices – brought about by the fracking revolution, the political cost of stopping Keystone would have been prohibitive.
