New research reported in Nature Climate Change finds that increased Canadian tar sands production would decrease global oil prices and thereby increase oil consumption. As a result, if the proposed Keystone XL pipeline led to increased tar sands production, the net annual emissions impact of KXL could be up to four times higher than found by the US State Department in its environmental impact assessment.
Impact of the Keystone XL pipeline on global oil markets and greenhouse gas emissions, a new study published in Nature Climate Change, concludes:
Impact of the Keystone XL pipeline on global oil markets and greenhouse gas emissions
Peter Erickson & Michael Lazarus
Stockholm Environment Institute, 1402 Third Avenue, Suite 900, Seattle, Washington 98101, USA
Nature Climate Change (2014) doi:10.1038/nclimate2335
Published online 10 August 2014
Climate policy and analysis often focus on energy production and consumption, but seldom consider how energy transportation infrastructure shapes energy systems. US President Obama has recently brought these issues to the fore, stating that he would only approve the Keystone XL pipeline, connecting Canadian oil sands with US refineries and ports, if it ‘does not significantly exacerbate the problem of carbon pollution’. Here, we apply a simple model to understand the implications of the pipeline for greenhouse gas emissions as a function of any resulting increase in oil sands production.
We find that for every barrel of increased production, global oil consumption would increase 0.6 barrels owing to the incremental decrease in global oil prices. As a result, and depending on the extent to which the pipeline leads to greater oil sands production, the net annual impact of Keystone XL could range from virtually none to 110 million tons CO2 equivalent annually. This spread is four times wider than found by the US State Department (1–27 million tons CO2e), who did not account for global oil market effects. The approach used here, common in lifecycle analysis, could also be applied to other pending fossil fuel extraction and supply infrastructure.
The Los Angeles Times reported (Keystone XL could mean more carbon emissions than estimated, study says):
The new study estimates that emissions could be 100 million to 110 million metric tons every year, “or four times the upper State Department estimate,” the authors wrote.
“The sole reason for this difference is that we account for the changes in global oil consumption resulting from increasing oil sands production levels, whereas the State Department does not,” wrote authors Peter Erickson and Michael Lazarus, scientists based in Seattle with the Stockholm Environment Institute, a nonprofit research organization. …
In June, the Canadian Assn. of Petroleum Producers issued an annual outlook that scaled back projections for growth in oil sands output, in part because of delays in pipeline projects, including Keystone XL.
The slowdown seems to contradict the State Department’s conclusion that green-lighting Keystone XL would have little effect on production, and with it the emissions that stoke climate change.