TC Energy Corp., the Canadian oil company spearheading the project, announced on Wednesday that it “has terminated” the Keystone XL project. After more than a decade of political, legal, and PR battles, punctuated by aggressive protests and culminating in President Biden revoking the project’s existing Presidential Permit on his first day in office on January 20, 2021, TC Energy has finally determined that it simply isn’t worth trying to move the project forward.
While the environmentalist and tribal activists who have opposed the pipeline no doubt believe they’ve won a great victory, I can’t help but think about how much we (and, indeed the environment) have actually lost here.
The most obvious costs of losing the pipeline are economic. TC Energy estimated that construction of the Keystone XL would have created roughly 11,000 US-based jobs in 2021. That’s 11,000 jobs that will no longer be going to hardworking Americans, and some $1.6 billion in wages that will no longer be putting food on their tables and entering our economy. The State Department was even more bullish in its own 2017 analysis, estimating spending on the construction of the project would (directly and indirectly) “support a combined total of approximately 42,100 jobs throughout the United States for the up to two-year construction period,” and “contribute approximately $3.4 billion” to GDP.
This isn’t even considering the millions of dollars wasted in a decade-plus of legal and regulatory battles that could have been put to productive use elsewhere rather than enriching members of the legal profession at everyone else’s expense. Especially with how many people are still suffering from the impacts of the near-total shut-down of the economy in reaction to COVID-19, this is a tragic loss of opportunity for American workers to improve their positions.
But even on the environmentalists’ own terms—setting aside cold, unfeeling focus on dollars and cents—the death of the Keystone XL Pipeline is a tragedy. Much to the activists’ chagrin, neither TC Energy’s decision today nor President Biden’s decision on January 20 will have much of a discernable impact on the world’s demand for affordable, reliable energy. Production on the Alberta Tar Sands isn’t diminishing any time soon, and neither is the need to transport the oil produced there to the refineries for ultimate distribution to the world’s energy consumers (you and me).
What has in effect happened, then, is that all the oil that would have been flowing through a secure, state-of-the-art oil pipeline will now be transported to market via rail and truck, means of transport that are more dangerous and polluting than any pipeline. For example, pipelines result in far fewer deaths per year than either trucks or rail, despite transporting about 10 times more volume of oil than the other two combined. Transportation by pipeline is 4.5 times less likely to result in a spill than transport by rail.
The death of the Keystone XL means we have replaced a safe, inexpensive, and relatively eco-friendly means of oil transport with two objectively inferior ones, that are more likely to lead to more spills in more locations that pose a danger to humans and the environment.
All too often we allow ourselves to be whisked away by convenient, feel-good narratives without stopping to think things through for ourselves. Public aversion to oil pipelines, fueled by a sensationalistic press and an activist class who want to prohibit any land development at any cost, is going to result in energy that is more expensive, more dangerous, and more environmentally damaging. But hey, we were promised a Green New Deal; nobody ever said anything about that deal being any good.
