by A. Siegel, "Get Energy Smart NOW!", January 31, 2014
A typical Washington ploy — release late afternoon material that you hope disappears into the dustbin of weekend inattention to serious matters. The State Department’s release, earlier today, of a flawed look at the Keystone XL pipeline’s climate impact derived from a highly questionable (highly questioned with Inspector General investigations ongoing) process is a classic example. The world, however, is changed. The movement of information has changed. And, this is not something watched solely by people locked to their M-F, 9-5 jobs.
- It essentially assumes away the reality that not building the Keystone XL pipeline would lead to reduced production of Tar Sands dilbit.
- This is highly questionable.
- The reason for the pipeline: to get the oil to Gulf Coast refineries so that it can be sold into Chinese and European markets at world prices, rather than depressed Midwest US prices. Taking the oil out of the US market and sending to China would create roughly $20 per barrel greater profit for the producers. (This is, of course, the absolute core reason for building the pipeline — to maximize profits for those devastating Alberta digging up tar sands.) Hmmm … according to the State Department, against the logic of basically every single economic textbook ever written, more or less profit is irrelevant for (dis)incentivizing more or less aggressive efforts to expand production. Harvard MBAs watch out — everything you learned is, evidently, wrong.
- Even with rapid growth in rail transport capacity, the issue is not just price but capacity for moving dilbit out of Alberta. Keystone XL would be like opening a valve to release pressure, giving confidence to those considering Tar Sands extraction investments that they would be able to send their product to market for
- If you assume that the Dilbit will get produced and burnt no matter what you decide to do, of course the pipeline construction will not “significantly” impact climate change. The carbon will be pumped, according to this assumption, no matter what.
- This is highly questionable.
- The report is at odds, in essence, with stated US policy on climate change.
- It, in essence, uses a “business as usual” case for examining the KXL impact rather than “business as necessary.” This choice is a policy one and was not, as far as I can tell, ordained by law.
- For additional flaws, see, for example, 7 Facts Not in State Department KXL EIS.
- Someone gained information from a source that a government report was going to recommend FDA approval of a drug with $10s of billions of potential revenue. Would they be in an advantageous — illegally advantageous — position for trading that stock?
- Company executives began telling reporters, days beforehand and accurately it turns out, that the Pentagon was going to announce that their company won a major project that would double their revenue. Would it make sense for the SEC to take a look at seeing whether there was any unusual trading in the stock in the week(s) before the announcement and to look into how the company executives knew (and were stupid enough to tell people what they knew) that they had won the project prior to the announcement?
“The State Department’s review, written by Big Oil’s cronies, presents a fatalistic view of a future devastated by extreme and catastrophic climate change. But we, and millions of Americans, know there is a different way.This report assumes business as usual, which is not surprising for an industry-written report. Despite that, the report concedes that the emissions impact could be “1.3 to 27.4 MMTCO2e annually,” equivalent to as many as 5.7 million new cars.5.7 million new cars is clearly a significant increase in carbon emissions.There’s a new scenario we’re seeing grow stronger every day, one of concerned citizens rising up and saying no to Big Oil wrecking our communities and our climate. As recently as two years ago no one in Washington thought this pipeline could be stopped. Importantly, this report also concedes that other pipelines, such as the Northern Gateway, are looking less likely because of strong opposition.The President says he understands climate and is committed to acting in the interests of posterity and not big donors. That means rejecting Keystone XL, plain and simple. The President and Secretary of State Kerry have all the information they need to reject this pipeline.As a new phase of public comments begins, we know the President will be hearing loud and clear that this report is an artifact of a corrupt process, and the pipeline is a disaster for our climate, our communities, and our future.” Final Supplemental Environmental Impact Statement for the Keystone XL Project Executive Summary, January 2014, page 15: http://keystonepipeline-xl.
http://getenergysmartnow.com/“Why in the world does Big Oil seem to know the findings of the State Departments report before Congress and the American people do? Because this process has been corrupted by the money and power of Big Oil since the beginning,” said John Sellers.