Posted by: ericgrimsrud | August 29, 2014

Scientific Mischief at the US State Department?

Last year, I was both puzzled and disappointed by a statement put out by the US State Department concerning the impact of the proposed Keystone XL pipeline on global CO2 levels. The main conclusion they drew from their in-house study of that proposed project was that its construction and implementation would have only a minor effect on global CO2 emissions. From my own rough estimates of the Keystone XL’s impacts, I had expected its effects to be much more substantial. I am not surprised, therefore, to note that more recent studies of the XL’s potential impacts are suggesting that the State Department’s estimate of Keystone’s impact was far too low due to a questionable assumption they made in their analysis.

For a thorough description of this issue, see http://www.theguardian.com/environment/climate-consensus-97-per-cent/2014/aug/28/state-department-underestimates-keystone-carbon-pollution. Key aspects of these new insights are that the climate change impacts of Keystone will be about three to four times that claimed by the State Department.

The State Department came to their very different conclusion by assuming that the tar sands oil would merely displace, barrel for barrel, some other oil extracted elsewhere on the planet. Therefore, the State Department analysis only counts the incremental increases of emissions for tar sands development and use. Tar sands are approximately 17% worse in terms of emissions than other fuels and the State Department only counted these extra emissions.

The more obvious and appropriate way to account for the additional carbon that the Keystone pipeline would be responsible for is simply to count the amount of carbon that would flow through that pipeline after it is built and refined on the gulf coast. We should assume that all oil of high quality and reasonable price will be used at some time after reaching the market and we know that it is the total accumulation of CO2 emissions over time that matters – as was explained in my previous post of Dec. 2012 on this blog called “Its our cumulative emissions, stupid” . Under these more realistic assumptions, the expected effect of Keystone becomes far greater than that suggested by our State Department.

In the reference cited above, a better way of thinking about all of this was suggested – starting with the following three alternatives we have before us.

1. Build Keystone and pump tar sands.
2. Not build Keystone but extract the equivalent oil somewhere else.
3. Not build Keystone and instead, use our energy more wisely, saving money and reducing CO2 pollution.

While economists seem to spend most of their efforts comparing option 1 with option 2, we should instead focus on comparisons of option 1 with option 3. It is only option 3 that offers the magnitude of climate change improvements we need and, at the same time, is likely to be cost effective if appropriately supported. The likely reason option 3 is not yet wholeheartedly endorsed is that option 3 is the one that is least like our existing methods of generating energy and the economic forces behind “business as usual” are well represented in all branches of our government, including our State Department.


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