Why It’s Fine That Obama Didn’t Mention Tar Sands

There’s one topic many environmentalists wish President Obama would have mentioned in his State of the Union Address: the Keystone XL pipeline that has been proposed as a way to get Canadian tar sands to market. Some environmentalists fiercely oppose it. They say that it will lead to a huge amount of carbon dioxide emissions, in part because producing oil from tar sands generates more carbon dioxide than producing oil from many other sources, and in part because it will make a big source of oil easier to get to market, which they think will increase oil consumption. They want the Obama administration to keep it from being built, and he’s supposed to make a decision soon.

It’s just as well that the president didn’t go into it, because it doesn’t really matter that much. It won’t increase greenhouse gas emissions, says Chris Knittel, a professor of energy economics at MIT.

For one thing, Knittel argues, even if Keystone XL isn’t built, a tar sands pipeline of some sort is bound to be built—there’s just too much money ($32 million a day [the original version had a typo and read “billion”]) to be made from building one to think that it won’t happen.

Whatever pipeline is built, it won’t actually increase oil production much, he says, because it will have only a tiny impact on the world oil market. It may lower prices a little, but not enough to increase demand. And if oil demand isn’t going to go up, neither are greenhouse gas emissions.

Actually, he says, if we build Keystone XL, greenhouse gas emissions will, if anything, go down. Any oil that come from it will displace the most expensive oil on the market right now, and that would likely be heavy crude oil from Venezuela that actually results in more carbon dioxide emissions than tar sands oil.

Reducing carbon dioxide emissions down to zero over the next few decades will require a lot more than blocking a pipeline. It will require breakthroughs in energy technology—and support for scaling up promising technology that already exists—that can allow clean energy to compete with fossil fuels. Obama is taking some steps toward this. His administration is working on limits to carbon dioxide emissions that will help level the playing field, essentially pricing in the cost of pollution. He’s setting up manufacturing innovation hubs that might help bring energy technologies to market.

But when Obama said his all-of-the-above energy strategy is working, he was wrong. Progress has been small in the U.S., and worldwide emissions are going up, not down. We need more support for innovation (see “Despite Funding Boost We’re Spending Too Little on Energy R&D”).