Keystone XL: The Cockroach Who Refused to Die

The unrelenting pipeline project that aims to transport more than 800,000 barrels of oil a day from Alberta, Canada to the Texas Gulf is at it again. When TransCanada was told in January the project was being turned down, what do they do? They make plans to build the southern half of the pipeline while they “work out” a new route for the northern half which was slated to go through ecologically sensitive areas in Nebraska. The strangest part of all of this, is that TransCanada doesn’t need approval from the State Department, and even if they did, the Obama Administration has decided to back the idea.

The Southern half of the pipeline will divert tar sands from Oklahoma to Texas. It’s not technically the Keystone XL pipeline but will still provide the same service to oil companies that Keystone would.

Controversy around the Keystone pipeline stems from many avenues from potential oil spills to indigenous issues, but for most people their primary issue is climate change. Tar sands are more carbon intensive than mining conventional sources of oil, emitting between 5-15 percent more greenhouse gases. As Climatologist, James Hansen has stated, “it is essentially game over” for climate if tar sands are exploited along side coal reserves.

Obama took a lot of heat on his initial decision to reject pipeline construction from his rival presidential candidates. Rick Santorum claims going through with pipeline construction will lower gas prices. While Newt Gingrich has been swearing up and down that Obama’s playing favorites with “environmental extremists” instead of spending time lowering gas prices.

Other advocates of the pipeline argue the benefits of importing from our friendly neighbors to the North instead of the Middle East. Another benefit they claim, the creation of jobs–which has been a matter of intense debate as the numbers have ranged from 5,000-20,000–would mostly only be temporary positions. My own personal favorite argument (noted above by pipeline proponents Santorum and Newt) in favor of the pipeline is that it will lower gas prices. The fact is that once the oil from Canada reaches the Texas Gulf it will not be be pumped around the U.S. for domestic oil use. It will enter the global oil market from Texas refineries and is very likely to be shipped overseas. It will raise gas prices as much as 20 cents per gallon. It’s the same scenario with the “half-pipe” from Oklahoma to the Gulf: we’re looking at a rise in gas prices while remaining vulnerable to price spikes.

While people argue that the purpose of Keystone pipeline and the “half-pipe” is to lower gas prices for the American people, TransCanada’s plans don’t mesh. The construction of the pipeline will subject the U.S to increased costs of heavy Canadian crude oil. Philip Verleger, founder of PK Verleger LLC (an energy consulting firm) told Bloomberg, “The Canadian plan was to use their market power to raise prices in the U.S. and get more money from consumers”.

It’s a little disconcerting the “half-pipe” is moving forward in that there is little stopping the entire Keystone XL project from taking over the Midwest which would be harmful not only to gas prices, but that pesky thing we call Climate Change. There should be no “half-pipe”, no whole-pipe. We need to start making a concerted effort to get away from an oil based society instead of crawling back to the same fossil fuel burning, environment polluting energy sources.

Keystone is like a cockroach. They’re difficult to kill, but it’s definitely not impossible.

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$2 Gas? I’m Not So Sure About That, Newt

I don’t know about where you live, but when I filled up this morning I paid over $4 dollars a gallon for gas. And not just a couple cents over mind you.

I’ve recently read some interesting articles revolving around gas prices. Specifically, about high gas prices and what a president can actually do about lowering them, which turns out to be not a whole lot.

With that being said, it may be a little confusing to some why Newt Gingrich is on his soap box promising gas prices to be $2.50 a gallon (or lower) if he’s elected president. Aside from the fact that his name is Newt and he looks like a goblin, I don’t know if that’s a statement I’m readily willing to believe.

When Obama took office, we were scoring gas at about $1.81 a gallon. We were also in the clutches of the worst global recession since the Great Depression. The recession depressed demand; less people were driving and costs went down. As the economy started chugging along once more, the price of gas rose. If Newt is able to deliver on his $2.50/gallon prices, there’s a good chance that means the economy has gone down the poop-shoot.

Under Obama (and his “all of the above” energy strategy), domestic drilling is booming and we’re importing less oil than we have in years, but as oil functions on a global market, domestic drilling doesn’t necessarily equal lower gas prices. For presidential candidates like Newt who are singing to the chorus of “drill baby, drill” –that won’t lower gas prices.

For those who might already be skipping towards Blame Road and Keystone Pipeline Lane, Obama’s blockage of the oil pipeline is not causing the high price of gas. In fact, Keystone would have little immediate effect on gas prices, and on a long term would probably only lower prices a few cents–maybe.

Gas prices are higher is because the economy is doing better, driving up the demand for gas. And with tensions and uncertainties in the Middle East, in addition to countries like China who are anticipated to use 5% more gas this year, prices will continue to rise.

It’s going to take more than drilling to solve our energy problems. An overall energy efficient economy will help make us more resilient to high costs and price spikes. Hopefully the American people realize that when voting time comes.

The Lesser of Two Evils

I’m always torn between what I think should happen, and what I think could actually work. It’s a tricky situation to be in as a part of the solar industry, and as a personal advocate for the environment.

In reading articles on reactions to Obama’s State of the Union Address (specifically one in the Huffington Post) I find once more, I’m torn.

President Obama clearly laid out his energy agenda in Tuesday’s SOTU Address, “We don’t have to choose between our environment and our economy,” he said, setting the tone for his energy and environmental plans.

By planning to expand domestic drilling, Obama is aiming to keep energy production and jobs at home, and emphasized the importance of breaking the U.S.’s dependence on foreign oil. Though he acknowledged that we only have 2% of the world’s oil reserves, and we need an “all-of-the-above strategy that develops every available source of American energy”, I’m concerned that we could potentially be implementing a policy that leaves us stuck between a rock and a hard place.

As Frances Beinecke, president of the Natural Resources Defense Council said, “Home-grown sources of energy certainly are preferable to imports, especially from unstable regions of the world.”

Expanding domestic drilling may indeed be the lesser of two evils, as we don’t have a system set up to run, even partially, on renewables. But by continuing to use natural gas as a main source of fuel, we may be perpetuating the same fossil fuel mindset we’ve held for the past century, instead of concentrating on expanding clean energy that we can use indefinitely.

And though I’m sure Obama meant it in a reassuring manner, his statement that we have enough natural gas to last American’s for almost one hundred years, isn’t exactly comforting to me. Are we going to be dependent on natural gas for the next one hundred years until every last drop has been put to use in our energy intensive society? Even in one hundred years, will we have implemented green energy on a large enough scale that we can survive without having to return to the dark ages when we couldn’t have every light on in the house and each plug occupied powering our X-boxes, laptops, cell phones, iPods, tables, and menagerie of other devices?

Though I remain torn, I am happy with this statement Obama made. I hope sets the actual path our energy policy will take:

“We have subsidized oil companies for a century. That’s long enough,” Obama said. “It’s time to end the taxpayer giveaways to an industy that’s rarely been more profitable, and double-down on a clean energy industry that’s never been more promising. Pass clean energy tax credits and create these new jobs.”