A new report says the U.S. government dramatically underestimated the level of greenhouse gas emissions that would result if the controversial proposed Keystone XL pipeline becomes a reality.
The study, by the Stockholm Environmental Institute, found that building the pipeline, which would connect Canada’s oil-rich tar sands to refineries in the Gulf of Mexico, would produce greenhouse gas emissions at least four times higher than the U.S. State Department’s official estimate.
The study’s authors said that the U.S. officials did not take into account the fact that, by providing an outlet for Canada’s tar sands to reach international buyers, global oil supplies would increase, resulting in a moderate price decline of about $3 per barrel, according to the study. Basic economic theory dictates that lower prices would lead to greater consumption.
More specifically, the study estimates that global oil consumption increases by 0.6 barrels for every barrel of oil added to global supply. The study finds that global greenhouse gas emissions would increase by 121 million tons of carbon dioxide a year. The study was published in the journal Nature Climate Change.
There are a couple of interesting things about the findings. First, 121 million tons of carbon dioxide is barely a rounding error, considering that the world emits 36 billion tons of carbon dioxide per year. And the impact pales in comparison to what’s produced by the hundreds of coal plants in the U.S. and world.
Nevertheless, the emissions are not trivial. The 121 million added tons of annual CO2 emissions is like building an additional 31 average-sized coal-fired power plants. (That figure assumes EPA’s estimate of 3.8 million metric tons of CO2 emissions per power plant, per year.)
Keystone XL pipeline supporters like to play down the environmental impact of the project, but since the U.S. is implementing new regulations to reduce the climate impact from its existing inventory of coal-fired power plants, choosing to add the equivalent emissions of 31 new coal plants seems a little odd.
U.S. President Barack Obama has said he would approve Keystone only if it “does not significantly exacerbate the problem of carbon pollution.” Given the figures from the latest study, the pressure on him to reject the pipeline is certain to increase.
And it is important to note that it is not at all clear the extent to which the Canadian tar sands will be developed if Keystone XL isn’t built. Some oil will certainly be transported by rail -- as the American Petroleum Institute noted in its response to this study -- but there is no way that rail will be able to move the equivalent amount of oil that the pipeline would handle, or at least, not without a monumental effort to expand rail capacity.
The Keystone XL would have a capacity to carry 830,000 barrels per day, which is roughly how much oil the entire rail system carried on average in 2013.
The capacity to carry oil by rail would thus need to approximately double from 2013 levels in order to handle the same amount of oil that Keystone XL will carry. While possible, shipping oil by rail adds about $5 to $10 to the cost of moving each barrel of crude oil. That would likely force tar sands producers to cut back on production because the marginal barrel would no longer be profitable. Thus, fewer emissions.
Moreover, the industry wouldn’t be fighting so hard for the pipeline if the tar sands were going to be produced and exported anyway. Other pipeline routes could get the tar sands out, but those have also run into trouble. A proposed route to the east coast just recently hit a wall in Maine, and a pipeline to Canada’s west coast is also facing some serious hurdles. (For a great depiction of all the major oil pipelines in North America, the organization Frac Tracker has put together an excellent map, which you can see here).
There are other reasons to approve the pipeline – it could add to North American energy security, for example, or it could simply be an important source of additional global supply – but with this latest study, it will be much harder for the White House to argue that Keystone XL would have a minimal impact on greenhouse gas emissions.
By Nick Cunningham of Oilprice.com