- Alberta wants it because it's a company
townprovince that puts a priority on getting oil to marketmoney*
- The US government wants it because Canadian oil is cheaper and safer than really foreign oil
- Environmentalists have tossed cost and benefit to the wind (ignoring the danger of shipping oil in trains or the environmentally dangerous route of taking oil to the Pacific), claiming -- more or less -- that the end to Keystone will signal the end to climate change.**
- Let's ignore facts such as Keystone has nothing to do with US emissions (that's demand), Canadian oil sands are likely to be mined (releasing carbon) even without Keystone, and how Keystone could displace equally dirty Venezuelan or Nigerian oil
- Let's assume that "no net impact" means displacing additional emissions related to the production of oil in Canada (again, not its consumption, which emits the same carbon as oil from other places), which means that Keystone will add 4-21 million tons of carbon per year to emissions [pdf]. Let's call that 20 million tons, but let's assume that ongoing improvements will reduce that figure to 5 million tons in 40 years (the life of the pipeline)
- Let's note that you can buy carbon offsets in Europe for EUR 4.50 (=USD=CAD 6.30)***
- 20 million tons will cost $125 million to offset (via EU ETS) in year one and $31.25 million in year 40
- Using a straight average of these two ($125+31.25/2) times 40 years (ignoring discount rates, which don't matter), we get $3.125 billion, which is much less than the $5 billion on the table
- TransCanada spends its money to build the pipeline
- The government of Alberta funds the offsets
- The oil goes to market
Bottom Line: Build the XL based on "polluter pays" and stop the empty debates.
* Alberta gets about 30 percent of its $40 billion budget from oil [pdf]; most Albertans work (in)directly for the oil-gas sector.
** Pipeline spills on land routes are not a big deal compared to spills near water; natural gas leaks are not very environmentally harmful but an explosion can kill you. That said, the Keystone folks may be lying about controlling spills and leaks. I'll have post(s) on fracking and pollution related to oil & gas production (the real problem) soon. In the meantime, read this excellent analysis of drilling for oil off the coast of British Columbia -- note the author's statement that some blame for the Deepwater Horizon spill rests with poor regulation; I said the same, more strongly.
*** I think that carbon offsets are often BS, but they're widely used and abused -- as California will find.