THIS CARBON BUDGET explains why Abraham, Caldeira and Hansen joined 15 other scientists to sign a letter to President Obama urging him to reject the proposed 2,700-kilometer-long Keystone XL pipeline. Building the pipeline -- and thus enabling even more tar sands production -- is "counter to both national and planetary interests," the scientists wrote.
Obama, who postponed approval of the pipeline just before the 2012 presidential election, struck a climate-friendly note in his second inaugural address as well as his 2013 State of the Union speech. His decision on Keystone XL will come after the State Department releases its final report on the pipeline.
In a first draft of its report, the State Department downplayed the pipeline's impact, both on the viability of the tar sands operations and on the environment. Keystone XL, it said, would be "unlikely to have a substantial impact" on greenhouse gas emissions. But the authors of the report seem to have assumed that if Keystone XL were not built, Canada would find some other economical way of transporting the oil to consumers.
The Environmental Protection Agency issued a response in April that cast the matter in a different light. According to Cynthia Giles, assistant administrator for EPA'S Office of Enforcement and Compliance Assurance, the State Department report relied on faulty economics, among other oversights. The EPA, drawing on past experience with big environmental assessments, suggested that alternatives to Keystone XL were either significantly more costly or faced major opposition. Having to get by without Keystone XL, in other words, might constrain tar sands development. In May the International Energy Agency (IEA) confirmed this analysis in its own prediction for the tar sands.
Tar sands oil is already traveling south by train, but this is a stopgap measure. Moving tar sands by rail is three times more expensive than by pipeline at current rates. As the tar sands operations ramp up, rail alone could prove a prohibitive cost barrier to further development.
What about another pipeline, should Keystone XL fail? Canada has the option of going west to the Pacific Coast to reach supertankers bound for China. Or it could go east, through existing pipelines, to the Midwest or the Atlantic Coast. These options are problematic. A Pacific pipeline -- the least viable choice -- would have to traverse the Rocky Mountains, passing through land owned by First Nations and other native groups in British Columbia, who have opposed a pipeline for fear of spills and other impacts. An Atlantic pipeline could be cobbled together from pipelines that now link Alberta to the eastern coast of North America. Engineers would have to reverse the flow of oil, much as ExxonMobil did for the Pegasus pipeline, which now carries crude from Illinois to Texas. But older pipelines that have been reversed may be more prone to leaks. Pegasus, for instance, sprung a tar sands oil leak in Arkansas this past April. And retrofitting existing pipelines is likely to elicit strong protest from environmentalists and others.
Given these obstacles, the tar sands industry needs Keystone XL to further expand, according to the EPA and IEA reports. At present, Alberta's tar sands produce 1.8 million barrels of oil a day. Keystone XL would ship another 830,000 barrels daily.
Mindful of the environmental opposition, Alberta and energy firms have tried to minimize greenhouse gas pollution in the tar sands operations. Royal Dutch Shell is trying an expensive alternative to breaking down bitumen into oil that involves adding hydrogen, rather than cooking off carbon into pet coke, to reduce CO2 emissions. The international oil giant has also begun developing plans for adding carbon capture and storage equipment to one of its mini refineries, a project dubbed Quest. When completed in 2015, Quest will attempt to annually store deep underground one million metric tons of CO2, or roughly one third of the facility's pollution. Another similar project plans to capture CO2 for use to flush more conventional oil out of the ground.
Alberta is also one of the only oil-producing regions in the world to have a tax on carbon. Currently capped at $15 per metric ton, discussions continue to potentially raise that price. The province has invested the more than $300 million collected to date in technology development, primarily to reduce CO2 emissions from the tar sands. The tax "gives us some ammunition when people attack us for our carbon footprint, if nothing else," Ron Liepert, then Alberta's minister of energy, told me in 2011.
Efforts to reduce the carbon footprint of the tar sands add further to the cost of extracting the oil and have not had a big impact on the carbon footprint. The 1.8 million barrels of tar sands oil a day produced in 2011 resulted in more than 47 million metric tons of greenhouse gas emissions in 2011, according to the Canadian Association of Petroleum Producers.
The IEA, in a 2010 analysis of ways to stay below the two degree C threshold, suggested that tar sands production in Alberta cannot exceed 3.3 million barrels a day by 2035. Yet mining already approved or under construction in Alberta could raise production to five million barrels a day by 2030. It's hard to imagine how to mine the tar sands without blowing the carbon budget.