EDMONTON – U.S. President Barack Obama’s decision to deny approval to the Keystone XL pipeline has permanently changed the discussion on new energy projects, say environmentalists and analysts.
“It’s premature to talk about other pipelines yet, but if Alberta and Canada don’t introduce proper greenhouse gas regulations for the industry, then it’s going to be challenging to make the argument that those projects are in the public interest,” says Simon Dyer of the Pembina Institute, a clean-energy think-tank.
Obama on Friday rejected TransCanada Corp.’s (TSX:TRP) application to build Keystone XL, capping a seven-year debate in both Canada and the United States over whether more fossil fuel infrastructure would lead to increased production.
Keith Stewart of Greenpeace called the decision “a victory for people power” and promised it would energize opposition to other proposed pipelines for carrying crude from Alberta’s oilsands.
“Nothing breeds success like success,” he said.
“The mobilizations that we already see around Energy East and around Kinder Morgan are just going to get stronger. The logic of ‘don’t build new pipelines because it contributes to climate change’ is exactly the same.”
Diane Beckettt, Sierra Club interim director, called Obama’s decision a model for Canada’s new Liberal government.
“This decision points to the opportunity for Canada to build a 21st-century economy based on today’s green, clean energy technologies, rather than continuing to rely on yesterday’s dinosaur fossil-fuel industry,” she said in a release.
Mark Jaccard, an energy economist at Simon Fraser University, said it was the previous Conservative government’s slowness on climate change that pushed Obama to reject Keystone XL.
While the Americans were meeting greenhouse gas reduction targets, Canada was ignoring its own and still asking the U.S. to approve a pipeline supporting a carbon-intensive industry, said Jaccard.
“Canada, under Harper, treated Obama like he was stupid.”
Jaccard said new pipelines could be built if enough greenhouse gases are cut elsewhere. But he disputed claims that pipelines don’t affect oilsands expansion.
“Emissions growth is directly correlated with delivery infrastructure growth,” he said. “It’s hard to attribute emissions growth to any one project, but if you’re stopping this pipeline and stopping that pipeline, you’re stopping the growth in emissions.”
Last month, Shell cited a lack of new pipelines as one reason for cancelling its Carmon Creek oilsands project.
Dyer said he’ll be watching how the Liberals review pipelines post-Keystone.
“Prime Minister (Justin) Trudeau did say the Liberal Party is committed to modernizing the National Energy Board’s review process, ensuring climate change is included,” he said. “It’s hopefully going to drive a conversation to actually get modern regulations in place that are going to address emissions from the oil and gas sector.”
Although some on both sides of the issue have said Keystone has accrued too much importance, Stewart said environmentalists were forced into making it a proxy for the entire climate change debate.
“Limiting pipelines is the only way to slow the expansion of the tar sands because (governments) had already handed out permits to more than double (their) size,” he said.
“It became such an important issue in the United States, because this was an area where the president could act on his own without having to get something through (the Republican-dominated) Congress.”
Stewart said Friday’s announcement shows how far the debate on climate change has come.
“If you would have told me seven years ago that the president of the United States would be killing the Keystone pipeline because of the threat it poses to our climate, I probably wouldn’t have believed it.”
— Follow Bob Weber on Twitter at @row1960