As the Energy East Pipeline dominates ever more headlines, editorials, ads and press conferences in my home province of New Brunswick and elsewhere, I’m reminded of an interview given by Calgary Mayor Naheed Nenshi on the CBC Radio’s The House in February 2013.
Mayor Nenshi said:
We’ve got a resource that is valuable to us and to our kids and to our grandkids, and we know that someday it’s not going to be that valuable; someday we’ll have a low carbon world. And I think it would be deeply irresponsible for us to leave that resource in the ground so that it will be worthless for future generations.
Ponder that statement and you get to the heart of the current lust for pipelines out of Alberta, whether south, west, north or east. You get to the heart of why the Energy East Pipeline, a project barely contemplated just a year ago, has quickly received nearly universal adulations and blessings, and seems on an ultrafast track to reality.
But before we place our chips on the pipeline, perhaps the costs and benefits are worth closer scrutiny.
Almost every assessment of the pipeline stresses the economic gains it will provide to New Brunswick. A recent report by Deloitte and Touche (commissioned, interestingly, by TransCanada, the company building the pipeline) suggests our province will earn about $700 million in tax revenues over 40 years. That sounds like a lot, but, in context, it’s roughly $20 million per year in a province with an annual budget of about $8,000 million, or about 0.25 per cent of our budget. Not exactly a windfall.
The same report suggests NB would see about 1550 direct jobs as a result of the pipeline. That sounds tempting too. But over 90 per cent would be temporary, lasting three years at most. In context, NB’s construction industry presently provides 27,000 jobs, or nearly 20 times as many.
Finally, because Alberta oil is landlocked and therefore traditionally sold below world prices, it’s been suggested that bringing it east will lower energy prices for us. As rosy as it might be to imagine that world oil prices will suddenly drop because Alberta crude has arrived in Atlantic Canada, it’s probably more realistic to expect that Alberta crude will get more expensive as soon as a pipeline links it to us, and the world market.
So — economic glitter perhaps, but not necessarily economic gold.
It’s interesting, and perhaps telling, that the Deloitte and Touche study specifically excluded any assessment of the environmental aspects of the pipeline project. So has much of the official conversation. That’s like ignoring elephants in the room.
First, there’s the issue of pipeline integrity and the potential for spills. Pipelines have a long and mostly successful history, so it’s probably fair to assume that if they are well engineered, constructed, maintained and operated, the risk of ruptures is small. A spill is possible, but it’s probably the baby elephant in the room.
The jumbo elephant, quietly ignored in most of the conversation so far, is climate change. No matter what any of us may wish to believe, burning oil produces greenhouse gases, and greenhouse gases are warming our planet and disrupting our weather. The Energy East Pipeline, the Keystone XL Pipeline, the Northern Gateway Pipeline and the hinted Beaufort Sea option – all are big, new drinking straws stuck into that bituminous milkshake called the oil sands, serving it up to an addicted world that needs to break its addiction.
The International Energy Agency, a leading global authority, has stated that if we are to put the brakes on climate change, most of our known global fossil fuel reserves must remain untouched in the ground. Kudos to Mayor Nenshi for implicitly acknowledging that; but shame on those who interpret it as a signal to get as much oil to market as quickly as possible while it’s still worth something. Hence the pipeline bonanza in which we are being asked to partake.
Jobs come and go but climate change is permanent. Years from now, our grandkids will look back on the decision we are facing today. I can’t imagine them being very sympathetic or understanding if we choose to trade away their long term climate stability for our short term prosperity. But that’s the very trade we’re contemplating as we consider the Energy East pipeline.