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Keystone XL Pipeline (KXL)

President Biden’s Executive Orders and Keystone XL cancellation: what impact on Canada?

By Elizabeth Perry - Work and Climate Change Report, February 1, 2021

Incoming U.S. President Biden exceeded expectations with the climate change initiatives announced in week 1 of his term, and many have important repercussions for Canada. The most obvious came on Day 1, January 20, with an Executive Order cancelling the Keystone XL pipeline and taking the U.S. back into the Paris Agreement. Also of potential impact for the Canadian clean tech and auto industries – the Buy American policies outlined in Executive Order on Ensuring the Future Is Made in All of America by All of America’s Workers (Jan. 25). On January 27 ( “Climate Day ”), the Executive Order on Tackling the Climate Crisis at home and abroad (explained in this Fact Sheet ) announced a further series of initiatives, including a pause on oil and gas leases on federal lands, a goal to convert the federal government’s vehicle fleet to electric vehicles, and initiatives towards environmental justice and science-based policies. Essential to the “whole of government” approach, the Executive Order establishes the White House Office of Domestic Climate Policy to coordinate policies, and a National Climate Task Force composed of leaders from across 21 federal agencies and departments. It also establishes the Interagency Working Group on Coal and Power Plant Communities and Economic Revitalization, “to be co-chaired by the National Climate Advisor and the Director of the National Economic Council, and directs federal agencies to coordinate investments and other efforts to assist coal, oil and natural gas, and power plant communities.”

The New York Times summarized the Jan. 27 Orders as “a sweeping series of executive actions …. while casting the moves as much about job creation as the climate crisis.” A sampling of resulting summaries and reactions: ‘We Need to Be Bold,’ Biden Says, Taking the First Steps in a Major Shift in Climate Policy” in Inside Climate News (Jan. 28); “Fossils ‘stunned’, ‘aghast’ after Biden pauses new oil and gas leases” in The Energy Mix (Feb. 1); “Biden’s “all of government” plan for climate, explained” in Vox (updated Jan. 27) ; “Biden’s Pause of New Federal Oil and Gas Leases May Not Reduce Production, but It Signals a Reckoning With Fossil Fuels” (Jan. 27) ; “Biden is canceling fossil fuel subsidies. But he can’t end them all” (Grist, Jan. 28); “Activists See Biden’s Day One Focus on Environmental Justice as a Critical Campaign Promise Kept” and “Climate Groups Begin Vying for Power in the Biden Era as Pressure for Unity Fades” (Jan 21) in The Intercept , which outlines the key policy differences between the BlueGreen Alliance (which includes the Service Employees International Union, the American Federation of Teachers, and the United Steelworkers in the U.S.) and the Climate Justice Alliance, a national coalition of environmental justice groups.

Pipe Dreams: Why Canada’s proposed pipelines don’t fit in a low carbon world

By Axel Dalman and Andrew Grant - Carbon Tracker - July 2020

Carbon Tracker’s modelling shows no new oil sands are needed in a low carbon world.

Prospective pipeline projects represent a significant expansion of capacity, with taxpayer support. However, new pipelines are surplus to requirements under Paris Agreement demand levels.

Canadian authorities face the challenge of trying to reconcile their natural resources development plans with their positioning on climate. Canada has previously having shown leadership on climate change issues, but its government support for pipelines – which are reliant on the failure of the Paris Agreement – risks damaging its credibility.

Key Findings:

Our research has previously shown that no new oil sands projects are needed in a low carbon world. All unsanctioned oil sands projects are uncompetitive under both the International Energy Agency’s 1.7-1.8°C Sustainable Development Scenario (SDS) and c.1.6°C Beyond 2 Degrees Scenario (B2DS).

All proposed new pipelines from Western Canada, in particular Keystone XL and Trans Mountain expansion, are surplus to requirements in a Paris-compliant world. Pipeline capacity may have proved a constraint in recent years, but under SDS, all future oil supplies from Western Canada can be accommodated by upgrades and replacements to existing pipelines, local refining and limited rail freight.

Even if discounts for Canadian crude narrow, new oil sands projects remain uneconomic. Western Canadian heavy oil trades at a steep discount to international benchmarks due to quality and transport challenges, averaging $25 below Brent over the last decade. Even if greater pipeline capacity reduces this to $10 in the future, in line with levels seen during previous periods of unconstrained supply, new projects still remain uneconomic under the SDS. Indeed, even if Canadian heavy oil were to trade at parity with Brent, which is extremely unlikely due to its lower quality, there would still be no new oil sands production under the B2DS and just 120,000 bbl/d would enter the market in the SDS – a level which would be covered by existing rail capacity.

Investors in oil sands face depressed cash flows in a low carbon world of falling oil demand and weak pricing, but will be forced to produce or pay the price due to inflexible “take-or-pay” transport fees for excess new pipeline capacity.

While take-or-pay contracts spread the impacts, pipeline investors still face financial risks as upstream production weakens. Uncontracted capacity will probably remain unused by producers, and contracts may cannibalise tariffs from other pipelines. Even take-or-pay commitments are subject to counterparty risk in a falling oil market.

The Canadian government’s stakes in Keystone XL and Trans Mountain could well prove to be a drain on the public purse. Under the SDS, government tax revenues and the value of the assets are unlikely to reach the levels anticipated at the time of sanction.

Canada’s leadership position on climate change may be undermined by its support for projects reliant on the failure of the Paris Agreement.

Read the report (Link).

Fossil Futures: The Canada Pension Plan's Failure to Respect the 1.5-degree Celsius Limit

By James K. Rowe, Steph Glanzmann, Jessica Dempsey and Zoë Yunker - Canadian Centre for Policy Alternatives, November 2019

THE WORLD’S LARGEST PENSION FUNDS comprise over half of global investment capital. The Canada Pension Plan Investment Board (CPPIB) manages one of the country’s largest pools of investments, at $400 billion. How pension funds choose to invest has significant bearing on how we collectively address the climate emergency and the needed energy transition away from fossil fuels. In this report we ask: Is the CPPIB investing with the 1.5-degree Celsius limit on global average temperature rise in mind?

In April 2016, Canada was among 195 countries that signed the Paris Agreement, committing to “holding the increase in the global average temperature to well below 2 degrees Celsius above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5 degrees Celsius.”

Our major finding is that the CPPIB is not investing with the 1.5-degree limit in mind. Within its public equities portfolio, it has over $4 billion invested in the top 200 publicly traded fossil fuel reserve holders (oil, gas and coal). To stay within 1.5 degrees, these companies can extract only 71.4 billion tonnes of carbon dioxide, yet the companies the CPPIB is invested in have 281 billion tonnes in reserve, meaning they have almost four times the carbon reserves that can be sold and ultimately burned to stay within 1.5 degrees. Since reserves are factored into current company valuations, this means the CPPIB has invested billions of dollars in companies whose financial worth depends on overshooting their carbon budget.

This is a moral and ecological failure. It is also a financial risk. As energy generation shifts away from fossil fuels, investors who do not respond could be left with “stranded assets”—investments that are no longer profitable. In its 2019 Financial System Review, the Bank of Canada included climate risk in its analysis for the first time. Canadian fossil fuel companies and their investors are especially exposed to stranded asset risk since the majority of oil produced in Canada is high-cost, carbon-intensive bitumen from the oil sands. And yet, the CPPIB remains exposed to the biggest oil sands majors, with over $1.2 billion invested in Canadian Natural Resources Ltd., Suncor Energy Inc. and Cenovus. Canadian pension beneficiaries may therefore be particularly vulnerable to stranded assets and the financial risks they pose.

Read the report (PDF).

Union Locals Build Support for the Green New Deal’s “Just Transition”

By Candice Bernd - Truthout, April 6, 2019

Undeterred by the Senate’s recent dismissal of the Green New Deal, Rep. Alexandria Ocasio-Cortez (D-New York) recently accepted Congressional Coal Caucus member Rep. Andy Barr’s (R-Kentucky) invitation to tour a coal mine in his district and meet with mine workers and voters in Appalachia to talk about how they could benefit from the resolution’s “just transition.”

That transition, as laid out in Representative Ocasio-Cortez’s plan, would include a federal jobs guarantee for U.S. workers. This includes former fossil fuel sector workers as they transition to build the infrastructure needed to shift the country to 100 percent renewable energy within 10 years.

Even as many of the resolution’s proponents are now turning their focus away from passing the Green New Deal on the heels of March’s procedural vote in the Senate, climate change legislation remains a priority for the Democratic Party. The resolution’s supporters are now looking at multiple bills in hopes of advancing standalone elements of the broader initiative as grassroots groups like the Sunrise Movement continue efforts to build support for the plan.

But what exactly would a Green New Deal or another piece of climate chance legislation focused on transitioning to renewables mean for the Kentucky coal workers Ocasio-Cortez is set to meet?

The plan backs union jobs and outlines commitments to “wage and benefit parity for workers” affected by the energy transition. The resolution also supports collective bargaining rights for workers while calling for “trade rules, procurement standards, and border adjustments” with strong labor protections.

Still, labor leaders like those on the AFL-CIO’s Energy Committee remain skeptical of the resolution’s call for a just transition. The Energy Committee sent an open letter to the resolution’s authors, Sen. Edward Markey (D-Massachusetts) and Ocasio-Cortez, blasting the resolution last month. “We will not stand by and allow threats to our members’ jobs and their families’ standard of living go unanswered,” wrote Cecil Roberts, president of the United Mine Workers of America, and Lonnie Stephenson, president of the International Brotherhood of Electrical Workers (IBEW).

The March 8 letter comes on the heels of a February letter sent to the chair of the House Energy and Commerce Committee, Rep. Frank Pallone (D-New Jersey), and its ranking member, Rep. Greg Walden (R-Oregon), outlining the “grave concerns about unrealistic solutions such as those advocated in the ‘Green New Deal,’” by seven unions representing workers in the building industry.

The strongest support for the plan has come from the joint executive board of the 163,000-member East Coast property service union, 32BJ SEIU, which passed its own resolution in February in support of the Green New Deal. Union President Héctor Figueroa recently condemned the Senate’s procedural vote to reject the plan, saying in a statement that, “Creating good jobs in this exciting new industry is as doable as it is necessary, but only if we work together in unity rather than giving into Washington’s divisive tactics.”

Trade Unions For Energy Democracy: Asia-Pacific Regional meeting

By staff - Trade Unions for Energy Democracy, August 29, 2017

Agenda:

Chair: Lance McCallum (National Campaign Coordinator, Australian Council of Trade Unions)

1. Sean Sweeney (Director, Trade Unions for Energy Democracy) :
A. Keystone USA: Calling from Nebraska: testifying against jobs claims for Keystone pipeline, strong movement in republican state also from first nations and environment groups
B. USA: Positive TUED presence at recent People’s Summit in Chicago – good traction in USA and support from Bernie Sanders supporting unions for TUED – this is against the spilt over energy in unions in the USA
C. UK: Labour party has adopted platform of energy democracy – Corbyn’s excellent result is encouraging–the platform is not straightforward nationalisation rather focused on initiatives like municipal control and procurement. Further movement from the Trade Union Council (UK) through recent motion to split up big power utility companies
D. Europe: Successful first meeting in Geneva that brought together cross section of European unions including – France, UK and Basque region. Resolved to produce framing statement for COP 23 when in Bonn.
E. South Africa: NUMSA and new national centre (SAFTU) undertaking strike action against the closure of coal and adoption of privatised renewable energy. Potential to strike at 6 power stations currently. Potential for NUMSA and SAFTU to embark on campaign for nationwide just transition campaigns (which would be first of such scale)
F. Australia: impressed by latest video on social media by ACTU starting a conversation about nationalising electricity system.
Questions

Colin Long: TUED presence at COP 23: Yes TUED is applying to host side event, have presence as part of union contingent, potential street protests. ITUC contact is Annabel Rosenberg – organising ITUC event.

2. Kate Lee ( Executive Officer: Union Aid Abroad – APHEDA)
a. India trip: End of November, 2017
TNI India is organising conference for unions, academics and state governments to explore climate impacts and energy democracy opportunities in India. Sean Sweeney will attend and speak with good opportunities for more discussion regarding the TUED analysis. There will also be an opportunity to link with a global unions meeting in the region. Following this Sean will be able to visit Nepal to visit TUED unions there for further discussions. Interested unions are welcome to participate – contact Kate for further details
b. Tom Reddington’s position
Tom has recently started working at Union Aid Abroad –APHEDA as the climate justice and energy democracy organiser. He has capacity to support the TUED Asia-Pacific network. He is progressing the mapping exercise from the recent New York meeting and will be distributing a short survey for members to complete soon.
Questions:
Greg Mclean will send Kate Lee contacts re. Energy democracy and unions in India (Prayas and Raman Khan)
Colin Long: interested in bringing Bangladeshi unionist to Australia to discuss new coal projects (e.g. Adani) from their perspective and worker exploitation

President Obama: Keystone XL Pipeline “Would Not Serve National Interest”

By Staff - Trade Unions for Energy Democracy, November 6, 2015

National Nurses United rally against Keystone X-L, Golden Gate Bridge, San Francisco, 2013

President Obama has announced his support for US Secretary of State John Kerry’s rejection of the long-proposed Keystone XL Pipeline project, which would have brought Canadian tar sands oil to the Texas south coast for shipping overseas. Supporters of real action to address climate change and energy democracy are celebrating the announcement.

US Trade Union Opposition to Keystone XL:

Research has shown the pipeline posed serious threats to the environment, safety and economies of communities along its route, while promises that the project would be a major creator of jobs were unfounded. For more on these issues, please see:

Winds of Change: Public Opinion on Energy Politics in Saskatchewan

By Andrea Olive, Emily Eaton, and Randy Besco - Canadian Centre for Policy Alternatives - April 2018

Energy politics are controversial in Canada. Debates over pipelines, from the Kinder Morgan Trans Mountain expansion to TransCanada’s Keystone XL, are often splashed across newspaper headlines. In Saskatchewan, however, the Saskatchewan Party government and the official NDP opposition have rarely disagreed about the importance of defending the province’s oil industry from anti-pipeline activists and federal climate change policies. Most recently, the interim leader of the NDP sided with Alberta Premier Rachel Notley in the dispute between Alberta and British Colombia over Kinder Morgan.1 Although Saskatchewan produces no bitumen itself, the NDP joined Premier Notley in condemning BC Premier Horgan’s announcement that British Colombia will place restrictions on the shipment of bitumen through its territory.

Given the seeming political consensus that defending the oil industry is consistent with defending the province’s interests, one might assume that Saskatchewan people are relatively united in their support for fossil fuel extraction. In this report we present some surprising results of public opinion polling that we conducted on issues of oil extraction, environment, and climate change in the province. Our results show that people living in Saskatchewan support a transition away from fossil fuels and agree that the government should invest more in solar and wind power while strengthening environmental regulations.

Read the report (PDF).

To Stop Keystone XL, 8,000 People in Just 24 Hours Make 'Promise to Protect'

By Jon Queally - Common Dreams, November 22, 2017

It's been less than 48 hours since a panel in Nebraska gave final approval for the Keystone XL pipeline to built in the state, but already more than 8,000 people have vowed to put their bodies on the lines—and in front of the construction path, if needed—to make sure the construction never happens.

The vow to stand against the pipeline—dubbed the "Promise to Protect"—was launched Monday during a gathering of Indigenous leaders and their allies in South Dakota who renewed their vows to defend sacred lands, waters, and sites against new pipelines and any expansion of the Canadian tar sands. The petition was then endorsed by other Native tribes, green groups, and high-profile climate activists.

Joye Braun, leader of the Wakpa Waste Camp at the Cheyenne River Sioux Reservation in South Dakota, said, "It gives me a great sense of hope and community to see nearly 8,000 people who have signed on to the 'Promise to Protect' our water, our homelands, our people, and to stand in solidarity with us on the ground. Especially our Indigenous communities, our tribes, and our farmer and rancher friends. This is hope, this is power—people power."

Faith Spotted Eagle, member of the Yankton Sioux Nation, said the surge of people commiting to stand against Keystone XL shows the Monday's decision was not a win for pipeline owner TransCanada.  "Continued attempted assaults on Mother Earth are never winning actions," she said. "The No KXL Dakota/Lakota gathering at Kul Wicasa on the same day of November 20 is an exciting renewed strong circle of allies who walk forward  stronger than ever. We will prevail in our spiritual movement."

People can sign the petition as individuals, but entire organizations can also make the commitment.

"TransCanada has many hurdles still ahead on Keystone XL, and if they ever run out, thousands of people have promised to be the biggest one," added May Boeve, exectuive director of 350.org, also backing the petition. "This pipeline's route through the upper Midwest has been hampered at every turn for nearly a decade, and we're doing all we can to keep it that way."

A climate insurgency: building a Trump-free, fossil-free future

By Jeremy Brecher - The Ecologist, April 28, 2017

As the thousands of foot-weary protesters leave the April 29 Peoples Climate March in Washington, DC - and its scores of sister marches around the country - one question will no doubt be foremost on their minds:

How can a march, or indeed any other action they take, force a reversal in the world's hurtle to climate doom?

After all, a single march, no matter how large, is not going to force President Trump and his administration of fossil-fuel company executives and climate-change deniers to reverse course.

They have already cancelled the Environmental Protection Agency's Clean Power Plan, authorized drilling and mining on public lands, and gutted regulations that protect local people and environments against the extraction of fossil fuels.

He has cleared the way for the Keystone XL and Dakota Access pipelines. His allies in Congress are whetting their knives to gut the Clean Air, Clean Water and Environmental Policy Acts. The fossil fuel industry is lining up for permits to build new infrastructure that will accelerate global warming and threaten local environments to boot.

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