Energy Blog

Canadian Prime Minister Stephen Harper traveled to New York City yesterday to talk up the benefits of the Keystone XL pipeline and Canadian energy in general. [Video of his conversation at the Council for Foreign Relations is here.] As the Toronto Globe and Mail reports, this is part of campaign by the Canadian government to lay out the benefits of the United States importing more Canadian energy and approving the pipeline.

Also yesterday, the House Transportation and Infrastructure Committee passed a bill that would allow construction of the pipeline connecting Alberta's oil sand production to Gulf Coast oil refineries. In a statement, Committee Chairman Bill Shuster (R-PA), said “This bill will finally allow construction of the Keystone XL pipeline, creating thousands of American jobs and displacing overseas imports with millions of barrels of safe and secure oil supplies.”

One way the Keystone XL pipeline will spur job creation is by supporting increased development of Canada’s oil sands. For example, Peter Bowe, president of Ellicott Dredge Enterprises in Baltimore, MD sells equipment to companies developing Canadian oil sands. He told the House Small Business Committee that increased development will mean demand for his company’s dredges for decades to come. Ellicott Dredge isn’t an isolated case. “About 2500 US companies export goods and services to Canada in support of oil sands,” Bowe told lawmakers.

Jobs will also be created by increased economic activity surrounding construction of the pipeline. As an example, in the same Small Business Hearing, Brent Booker, Secretary-Treasurer of the AFL-CIO’s Building and Construction Trades Department, talked about the economic benefits from the southern portion of the pipeline under construction from Cushing, OK to the Port Arthur, TX:

KBMT News in Port Arthur did a recent story detailing how the construction of the southern leg was providing a boost to the local economy, as workers are spending heavily on things like clothing, hotels, and restaurants.

Additionally, from lumber to sand, and from gravel to fuel, massive quantities of materials that are needed for the project are being purchases locally up and down the trough between Cushing and Port Arthur.

Rep. Patrick Murphy (D-FL) added:

For small businesses, the indirect economic effects are key. As workers deploy to communities along the pipeline’s path, significant opportunity may be created for local small business growth. In addition, small firms involved in the manufacture of pipeline components stand to benefit should this initiative receive regulatory approval. Taken together, this project represents real benefits for small businesses.

By the State Department’s estimates, 42,000 jobs will be supported by Keystone XL. In a labor market crying out for more jobs, this would be welcome.

That’s why there’s been strong support for the pipeline from small businesses, labor unions, Democrats, and Republicans. It’s not often that you find such breadth of support.

Unfortunately Keystone XL’s approval is bogged down in politics. The Houston Chronicle editorialized:

With every passing day, President Obama's decision to delay completion of the Keystone XL pipeline looks more like partisan folly and less like high-minded abundance of caution to ensure that the environment is protected. Let us count the ways:

Completion of the Keystone XL pipeline remains stalled, even though its route has been moved to satisfy concerns it would affect water quality and despite the fact that it is state of the art in construction, safety and engineering.

Further delay frustrates our Canadian friends, blocks job creation, and keeps us from improved energy security.

Rep. Shuster told reporters that he expects a vote in the House next week.

The United States is sitting on a lot of coal. If policymakers don’t want it used to generate electricity, we should be able to ship it to countries that want it, right?

Not if you’re anti-energy environmentalists. In the Pacific Northwest, groups like the Sierra Club want to stop the construction of new export facilities in Oregon and Washington that would ship coal from Wyoming and Montana to Asian markets. One of their “anything goes” tactics is launching a frivolous lawsuit against coal and railroad companies over coal dust blowing off trains traveling to ports.

Jeff Ostermayer at Shopfloor links to an op-ed by Roger McClellan, a former chairman of the Environmental Protection Agency’s Clean Air Scientific Advisory Committee who writes that these groups’ legal argument is too simplistic:

Just because a piece of coal is found in the water or coal dust is found near a rail track does not mean humans are exposed to it. Coal is not a substance that breaks down easily. Coal is relatively innocuous. Simply moving it by trains or trucks or barges does not equate to a risk to the environment or human health.

Coal continues to play an important role in meeting energy needs around the world, with steady improvements made in its transport and use. Coal has been transported through the Northwest by rail for decades and there has never been any evidence of harm associated with this rail transport.

In an op-ed in the Bellingham Herald, Mike Elliott, a member of the Brotherhood of Locomotive Engineers and Trainmen, first notes that in his two decades of working on trains he never heard complaints about coal dust from fellow union members. Second, he explains why he supports these exports projects:

We should be supportive of responsible construction projects in the Northwest and follow established procedures for evaluating and permitting those projects. Trying to influence a legitimate process by filing nuisance lawsuits is counterproductive to U.S. industry, job creation and our economy in general.

The middle class of the 1950s and ’60s was, in large part, a blue-collar workforce that built and manufactured right here in the United States. We must remember the importance of these blue-collar jobs, sustain the ones we have and help create more of them.

Responsible projects that meet or exceed today’s environmental standards should not be delayed simply because someone can go down to the courthouse and file a lawsuit.

Judging from their behavior, these groups will use any trick in the book to oppose these export facilities and block the jobs and economic growth that will come from exporting American coal.