The Keystone XL lawsuit will be a test case for the environment


On March 17, the attorney generals of Texas and Montana, together with 19 other Republican-leaning states, filed a lawsuit against the Biden administration, challenging the President’s unilateral revocation of cross-border permits for the Keystone XL pipeline extension.

While the revocation back in January (mere days after Mr Biden was sworn in as 46th President) did not come as a complete surprise, given that it was one of Mr Biden’s campaign pledges, the announcement did rankle many stakeholders on both sides of the US-Canada border. The beleaguered project, which Calgary-based TC Energy has ben trying to get off the ground since 2008, was supposed to connect central Alberta’s oil sands to an important junction in Nebraska, from where it would be distributed to various refineries.

While the Biden administration has sought to sell the permit revocation as an environmentally-sound move, proponents of the project on both sides of the border have argued that the President’s move had been a rash one, without due consideration of the economic implications. In addition, legal commentators have questioned the legality of the President’s unilateral revocation, arguing that given the large commercial value of the project, Congress should have consulted.

Regardless of where you sit on the Keystone XL debate, one thing is clear – the pipeline extension would have been an economic boon for both Americans and Canadians, generating an estimated ten thousand jobs, not to mention the tens of millions of dollars’ worth of lost revenue for affected states in the form of payroll and property taxes. Both of these things are desperately needed on both sides of the border due to the ravages of Covid-19.

But the picture starts to blur when we factor in the environmental implications of the project. Green opposition groups often raise concerns over the fact that the Keystone XL pipeline would not be transporting normal crude oil, but tar sands oil, which not only has a bigger environmental impact from an extraction point of view, but also carries more risk from the transportation side (as the oil sands tar is more corrosive than regular crude, increasing the likelihood of pipeline leaks). While these are legitimate points, the fact remains that the cancellation of the project has not stopped the Canadian producers from extracting tar sands oil, and currently that oil is still being transported to US refineries via road, rail and sea – all of which are more expensive and riskier than pipelines.

Nevertheless, environmental groups see the cancellation of the project as a success, on the basis that it will help discourage further exploitation of untapped oil sands, and will also prevent production at existing facilities from being ramped up, thereby stopping the release of further greenhouse gases into the atmosphere, and preserving the otherwise affected landscape for future generations.

And it is at this controversial intersection – between the economy and the environment – that we will find ourselves again and again with other fossil fuel infrastructure projects in the future. Historically, policymakers have tended to side with the economy, preferring the measurable certainty of revenue generation and job-creation over the slightly fuzzier environmental risks. But, as our understanding of man-made climate change has become more refined and more generally accepted, the choice between short-term cash and the long-term well-being of our planet is no longer so cut-and-dry.

Even though this choice has traditionally been portrayed as being either-or (that is, if we choose the economy, we must therefore neglect the environment, and vice-versa), again, the reality is more complex. As our planet continues to heat up, the environmental consequences will affect not just the corals and the polar bears, but our lives and livelihoods as well. As the ‘freak’ cold snap that devastated Texas earlier this year demonstrated, extreme weather events are likely to become more frequent and more widespread.

While it is likely to be several months (at least) before the district courts of Texas hand down a decision about the legality of the revocation, this latest twist in the Keystone XL pipeline saga tells us several things. For one, weaning ourselves off fossil fuels is going to be a long and difficult process, as entrenched interest groups (like oil companies, car manufacturers and even government officials) will use ever tool in their arsenals to subvert the process. For another, we need to acknowledge that choosing to prioritise the environment will require concrete sacrifices in the short-term, in the form of increased joblessness for oil sector workers, for instance (something that the Canadian province of Alberta is already having to recon with), and that governments cannot just rely on market forces to magically diversify the economy and create jobs for the suddenly unemployed.

In this way, the findings of the Texas court in the Keystone XL case will provide a test case for where our prioritise currently lie, and give us a glimpse into what weaning ourselves off fossil fuels is likely to entail in the months and years to come.

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