November 11, 2013
But pipeline projects must also deliver benefits, not just costs, across the country
TORONTO— New pipeline development projects would deliver significant economic benefits to Alberta and the federal government, but also pass along costs as well as benefits to other provinces, concludes a new study from the Mowat Centre.
The analysis of the political context of the pipeline debate in Canada released Monday outlines Ontario’s stake in the national debate around pipeline development. The Politics of Pipelines: Ontario’s Stake in Canada’s Pipeline Debate, by Richard Carlson and Matthew Mendelsohn, lays out the main areas of consideration for the province, including the potential economic benefits to First Nations, local communities and provinces, but also highlights the risks to the environment and to Ontario energy consumers.
Expansion of oil sands development would significantly increase emissions that contribute to climate change. The progress being made by provinces like Ontario, British Columbia and Quebec to help Canada meet its greenhouse gas emissions reduction targets are being entirely negated by increased emissions due to oil sands production in other provinces.
The most realistic and reasonable way for many Canadians to support pipelines and the resulting expansion of oil sands production in Alberta, the Centre argues, is within the context of a federal price on carbon emissions.
“A federal price on carbon would allow for the expansion of oil sands and pipelines development while mitigating environmental and climate damage,” said Mowat Director Matthew Mendelsohn. “Proceeds from a price on carbon could be used to support the transformation of the Canadian energy sector through investments in new research, development and technology.”
The study also concludes that there are real risks to Ontario energy consumers. “The proposed Energy East pipeline would reduce natural gas capacity that currently serves many Ontario residences and businesses,” said Mendelsohn. “These consumers have already paid for the infrastructure that serves them. Under the current proposal, Ontario consumers would likely have to pay higher bills as pipeline capacity that they already paid for is diverted to other purposes.”
The study concludes that Ontario should support increased pipeline capacity and development but that efforts should be made to deal with Ontario’s concerns. “Ontarians and other Canadians have in general been supportive of Alberta’s ambitions with regard to the oil sands,” said co-author Richard Carlson. “It is surprising that the Alberta and federal governments have not been more focused on finding ways for other Canadians across the country to see benefits rather than costs from expanded oil sands development.”