Calgary-based TransCanada Corporation has slashed toll charges by nearly two-thirds on its main natural gas pipeline to Ontario, in a successful effort to tease new shipping commitments from producers in British Columbia and Alberta, several news outlets report.
Canada’s second-largest pipeline company has secured a number of new 10-year shipping commitments for gas by lowering its tolls from around $2.00 to $0.77 per gigajoule, JWN Energy reports. The industry news outlet predicts the cut rate will allow gas produced in British Columbia’s Montney and Alberta’s Duvernay regions to recapture market share in Ontario that had been lost since 2006 to U.S. supplies from less distant fields in Ohio, Pennsylvania, and Virginia.
“It’s a big deal,” fossil energy investment analyst Jackie Forrest told JWN. “It’s almost equal to an LNG [export] project in some ways, because if we hadn’t got this it’s very likely we would have lost more than one billion cubic feet a day of market over the next year or two. By having this deal, we’re going to maintain those flows.”
TransCanada had previously sought to tempt shippers in October by offering to lower tolls to “a range of $0.75/GJ to $0.82/GJ depending on the shippers’ contract volume commitments,” JWN notes, but the offer “didn’t get enough support from producers to move forward.”
B.C. Natural Gas Development Minister Rich Coleman welcomed the clearcut price drop and accord with shippers, saying it was “nice to see the level of cooperation between gas producers and TransCanada to establish a competitive toll structure that will ensure B.C. natural gas can be delivered to Eastern Canada at a competitive cost.”
The toll reduction still needs approval from Canada’s National Energy Board, which the company says it hopes to secure in time to introduce the new rate before November 1. “There’s no requirement for any build, so our producers can access the market upon NEB approval,” TransCanada’s senior vice president of Canadian gas pipelines, Tracy Robinson, told Reuters.
That timetable would begin delivering Canadian gas to Ontario consumers “before rival pipelines from U.S. shale basins come online,” Reuters observes. “[U.S.-based] Energy Transfer Partners LP’s Rover and Spectra Energy Partners LP’s Nexus lines both have targeted in-service dates to Ontario’s Dawn [distribution] hub in November.”
However, the courts may put a wrinkle in TransCanada’s timeline. Earlier this year, two northern Ontario First Nations filed suit and sought an injunction against TransCanada for work it planned to conduct on a portion of the Mainline that runs through their traditional territories.
The Aroland and Ginoogaming First Nations contend the work “will cause impacts to the First Nations’ culture, their sacred relationship to the land that is at the core of their identity as Indigenous communities, and on their ability to continue to survive with the land.” The two nations also name the National Energy Board and the government of Canada as defendants in their suit.
Governments reveal their true priorities by their spending decisions, and that means next week’s federal budget will be an important test of the Pan-Canadian Framework on Clean Growth and Climate Change, Environmental Defence climate specialist Dale Marshall wrote last week in a Hill Times op ed [subs req’d].
“While the government continues with consultations and policy development of the framework, the upcoming federal budget must be used to take another big step forward on climate action in Canada,” Marshall noted. “Equally important as the amount of money the budget allocates is that the funding be systematically applied in the right places and the right ways to edge the country towards the clean economy we need. Investing in high-carbon projects and other activities that will systematically increase carbon emissions will make it all but impossible to achieve Canada’s climate targets.”
Marshall suggested several ways the budget can “reinforce and amplify” the framework adopted by the federal government and 11 provinces and territories last December. Dollars are needed for renewable energy deployment, smart grid development, off-diesel programs for Indigenous and other remote communities, and a national building retrofit program. Regulatory support for a clean fuel standard, a zero-emission vehicle strategy, and a zero net-energy building code will need funding, too.
And “the federal government needs to ensure that public money is spent only on infrastructure projects that put Canada on track to phase out the use of fossil fuels by mid-century,” Marshall writes. “Environmental Defence and business, academic, and environmental advocates have been urging the federal government to undertake a full life-cycle analysis of all proposed projects to determine their expected greenhouse gas emissions. The project proposal that can best meet the goal of the infrastructure while minimizing carbon emissions should be privileged over others that would lead to higher emissions.”
Just as important as the investments the federal budget makes will be the ones it leaves out. “With one hand, governments take revenue from polluters based on how much carbon they emit, and with the other they give money back to those same polluters in the form of subsidies,” he writes—$3.3-billion per year, by recent estimates. “Federal subsidies at least need to be eliminated by 2020,” he writes, “and this budget can begin that process.”
Late last month, in a post on Policy Options, Équiterre Government Relations Director Annie Bérubé pointed to Canada’s “tailpipe problem”—the 24 million cars and trucks that produced 23% of the country’s greenhouse gas emissions in 2014, and have accounted for three-quarters of the growth in energy-related emissions since 1990.
“If we’re going to achieve our climate goals and do our fair share to ensure the planet continues to be a safe place to live, we need to turn this trend around,” Bérubé wrote. “Around the world, a mobility revolution is gathering momentum. And Canada is wisely getting in on the action, with policies and investments that open the door wider for zero-carbon transportation.
“But if we are not ambitious in our plans, and deliberate about their implementation, we will miss out on opportunities to be industrial and environmental leaders.”
She pointed to local transit investments, vehicle fuel efficiency regulations, encouragement for electric vehicles and biking, and the growing trend toward shared mobility as “a path to a healthier planet, cleaner air in our cities, and economies that work efficiently.”
Forests are a cornerstone of the global effort to get climate change under control, but drought and a variety of unsustainable practices are putting them at risk, according to a collection of research papers summarized this week by Climate News Network.
“Land management plans submitted by nations that pledged in Paris in 2015 to contain global warming to 2°C or less could contribute 25% of the total promised reductions in the greenhouse gas emissions that fuel global warming,” CNNet reports, citing a paper in the journal Nature Climate Change produced by researchers from the UK, the European Commission, Italy, and the Netherlands. But “other studies suggest that any pledges may be difficult to keep.”
The research team affirmed that forests “shelter natural biodiversity, recycle rainfall, and offer protection from flooding and erosion. They also soak up carbon and deliver resources that should be sustainable,” writes correspondent Tim Radford.
But another study in the journal Ecology Letters concludes that more frequent, severe droughts are already putting forests at risk.
“A thirsty tree growing in a tropical forest and one in a temperate forest, such as those we find in Europe, will have largely the same response to drought and will inevitably suffer as a result of rising temperatures and changes in rainfall patterns,” said study co-author Sarah Greenwood of Scotland’s University of Stirling.
“As the temperature of the planet continues to climb, mass tree mortality will hit more forests than ever before,” adds co-author Alistair Jump. “Forests store a substantial amount of the world’s carbon and increased tree death will only propel future global warming.”
A third study, published in the journal Environmental Research Letters, concludes that even “sustainable” forest harvesting may not actually be sustainable. “Ecologists and economists have repeatedly argued that standing, natural wild forests are over the long term of greater economic benefit to both local communities and the rest of the world than as pasture or plantation,” Radford writes. But in a study of 233 villages in tropical Africa, Asia, and South America between 2005 and 2010, 209 of the communities “reported that at least one forest resource had declined. There were reports of reductions in timber, firewood, food, medication, and animal feed.”
On Climate Home, meanwhile, campaigners Julia Christian and Hannah Mowat of Brussels- and UK-based Fern point to regeneration of degraded forest landscapes as an opportunity to draw 330 billion tonnes of CO2 out of the atmosphere through the end of the century.
“This is our best, most realistic bet for the negative emissions we need,” they write. But “forest restoration done the wrong way could put lives in danger. Forest conservation projects have a well-documented history of displacing Indigenous communities from the land they need to survive.”
Christian and Mowat note that regeneration, combined with a reforestation program one-third the size of what would be required under some of the wackier biomass with carbon capture and storage (BECCS) schemes, “would put the world on track to achieve the 1.5°C temperature goal of the Paris agreement. In short, we need to ‘make forests healthy again.’”
But instead, the search for negative emissions is leading too many researchers—driven by all the 2°C pathways developed by the Intergovernmental Panel on Climate Change—down the path of CCS and BECCS.
“As climate scientist Kevin Anderson pointed out after 2015’s Paris conference, CCS leaves us gambling our future on a ‘carbon-sucking fairy godmother,’” Christian and Mowat write. “So far, the deployment of this technology has been very limited, and it is very unlikely to be rolled out quickly enough to provide the negative emissions we need.”
BECCS “is even more fantastical,” they add: CCS “essentially doesn’t exist.” BECCS makes too many assumptions about whether forests will be replanted, and wrongly equates “more biodiverse woodlands with monoculture plantations”. And the accounting for carbon stored and released—over time, and across geographies—is all wrong.
“You could cut down the Amazon, turn it into a parking lot, ship the trees to Europe to replace coal, and Europe would claim a reduction in emissions,” noted Tim Searchinger of Princeton University.
U.S. communities of colour and marginalized low-income whites will see the front-line environmental impacts as the Trump administration’s proposed 25% funding cut at the Environmental Protection Agency snuffs out the very brief hope that they might some day see environmental justice.
“The Trump administration has decided fenceline communities across the country, whose residents already bear an outsized burden from pollution, are on their own,” said Environmental Working Group President Ken Cook.
“Most pollution-spewing operations are within eyeshot of the backyards and kitchen windows of African American and Hispanic families, as well as those of many largely white lower-income communities,” he told the Guardian. “Through this decision to zero out funding for the EPA’s environmental justice programs, the president and the administrator have sent a shameful message: the health of poor Americans is less important than that of the wealthy.”
Toxic waste dumps, fracking wells, and other industrial facilities that emit waste to the open air or water are located disproportionately near communities rendered economically powerless by marginalizing conditions of race, poverty, or both. At least partly as a result, “black children are twice as likely to have asthma as their white counterparts,” the Guardian reports. “Meanwhile, nearly half of America’s Latino population lives in counties that do not meet EPA air quality standards.”
A state investigation into how lead-laced drinking water was delivered to residential taps in the largely black city of Flint, Michigan, it notes, “found that the poisoning was caused, in part, by ‘systemic racism’”.
Two months before the 2016 election, “the U.S. Commission on Civil Rights released a scathing report that found the EPA ‘has a history of being unable to meet its regulatory deadlines and experiences extreme delays in responding to Title VI [civil rights] complaints in the area of environmental justice,’” the paper notes.
The EPA has had an Environmental Justice Office responsible for “bridging the yawning disparity in pollution experienced by black, Hispanic, and low-income communities and wealthier white neighbourhoods,” writes reporter Oliver Milman. The office “provides grants to communities to mop up toxins and rehabilitate abandoned industrial facilities that are invariably found in poorer areas.”
And in the last months of the Obama administration, “the EPA unveiled a new effort to tackle lead poisoning, air pollution, and other problems suffered by communities of colour situated next to waste treatment plants, smelters, and other sources of toxins.”
But that work is now unlikely to get off the ground. The Environmental Justice Office is earmarked for elimination, along with nearly 3,000 jobs and funds for the “cleanup of lead, marine pollution, tribal lands, and the Great Lakes region.”
The Pawnee Nation is suing several Oklahoma oil companies in tribal court, seeking compensation for damage from a 5.8-magitude earthquake caused by wastewater injected into wells.
“We are a sovereign nation and we have the rule of law here,” said Executive Director Andrew Knife Chief. “We’re using our tribal laws, our tribal processes, to hold these guys accountable.”
The tribe “is seeking compensation for damage to public and personal property and market value losses, as well as punitive damages,” the New York Times reports. “The case will be heard in the tribe’s district court, with a jury composed of Pawnee Nation members.”
If the community wins a tribal judgement, “it can be taken to a state district court for enforcement just like any other judgment,” the Times explains, citing Indian law specialist Lindsay G. Robertson of the University of Oklahoma. “While experts say major civil judgments against non-Indians in tribal courts are rare, the United States Supreme Court last year left in place the authority of Native American courts to judge complaints against people who are not tribal members.”
Pawnee Nation lawyer Curt Marshall said the community had filed in tribal court mainly to assert its own sovereignty. “The tribe has jurisdiction over civil matters to enforce judgments within its jurisdiction, including judgments over non-Indians,” he said.
Officials in Oklahoma and Alberta have linked increases in earthquake activity to wastewater injections related to oil and gas fracking. Oklahoma regulators have directed fossils in the state to either close their injection wells or cut back their injection activities, though not all the companies have cooperated.
The quake in the Pawnee Nation suit had its epicentre about nine miles from the centre of Pawnee, OK, the Times reports. The tremblor “damaged buildings across the north-central community of about 2,200 residents. The sandstone facade of some buildings fell and several others were cracked. One man suffered a minor injury when part of a fireplace fell on his head. Oklahoma’s governor declared a state of emergency for the entire county.”
“We understand the industry is very important to the economy of Oklahoma, and the last thing we want to do is come in and shut the operations down,” Marshall said. “But we do want the oil and gas industry to act responsibly environmentally, and we want them to be held accountable for the damage they’ve created.”
The Dakota Access Pipeline may be completed in the next few weeks, after the U.S. Army Corps of Engineers scrapped a study of its environmental threat at a contested crossing beneath a water reservoir in the Missouri River. But a group of 120 large investors is the latest to call for a different ending to the story.
The Corps’ study, ordered by President Barack Obama, was launched just two days before his term of office ended. The U.S. Army announced that the project had been scrapped in a February 17 Federal Register entry.
Authorities had given what NBC News describes as a “few hundred people” a final deadline of today to abandon a camp established last summer to protest the pipeline’s advance. The Standing Rock Sioux, whose original protest against the DAPL caught global attention, attracting hundreds of outsider supporters to join the pipeline blockade, have also asked the remaining campers to leave.
“Authorities want the area cleaned and closed before spring floodwaters wash tons of trash and debris into nearby rivers, including the Missouri River, and cause an environmental disaster,” NBC reports.
The Standing Rock and Cheyenne River Sioux have continued to fight the pipeline in court, however. And even as the Army Corps announced the abandonment of its inconclusive study, the Huffington Post reported that “a group of more than 120 investors told 17 banks financing construction of the pipeline that the project should be rerouted.”
The group includes the giant funds handling pension savings for California’s public employees as well as New York City teachers and firefighters, “dozens of religious organizations,” and wealth managers. It claims to oversee a combined US$653 billion in assets. The investors addressed their statement to Citibank, Wells Fargo, and others that have loaned money to companies building the US$3.8-billion, 1,900-kilometre, 450,000 barrel-per-day pipeline.
Despite being close to completion, numerous reports in recent weeks have suggested the financial viability of the line’s main developer, Energy Transfer Partners, is on a knife edge.
Low natural gas prices seem destined to dash ex-casino mogul Donald Trump’s bid to resurrect coal industry jobs during his new gig in the Oval Office, after the owners of the country’s third-largest coal plant announced it would be shutting down decades ahead of schedule.
And the now-imminent closure of the 2,250-MW Navajo Generating Station (NGS) outside Page, Arizona “likely blows a hole” in the bankruptcy restructuring plan put forward by coal giant Peabody Energy, the Institute for Energy Economics and Financial Analysis reports.
Navajo is the biggest remaining coal plant in the western U.S., and one of two to be shuttered in the last three weeks.
Undeterred by mere facts, Trump claimed last week his administration is “bringing back jobs, big league,” after signing legislation that eliminates any requirement that natural resource companies disclose payments to foreign governments. “We’re bringing them back at the plant level. We’re bringing them back at the mine level. The energy jobs are coming back.”
But coal plant operators apparently live in the real world.
“The utility owners do not make this decision lightly,” said Mike Hummel, deputy general manager responsible for the Navajo plant. “NGS and its employees are one reason why this region, the state of Arizona, and the Phoenix metropolitan area have been able to grow and thrive,” he said. But the plant operator has “an obligation to provide low-cost service to our more than one million customers, and the higher cost of operating NGS would be borne by our customers.”
Navajo will close at the end of 2019. And less than three weeks ago in Ohio, Dayton Power and Light closed a deal with Sierra Club to shut down its 2,440-MW Stuart coal plant and its 666-MW Killen facility in June 2018. The company will build at least 300 MW of solar and wind capacity by 2022 and fund “a variety of energy efficiency steps and grid improvements,” the Post states.
IEEFA says Peabody can’t afford to lose its sales to the Navajo plant if it hopes to meet the financial targets in its restructuring plan.
“Peabody naturally wants the plant to stay open,” writes Finance Director Tom Sanzillo. But “far from being the economic engine that Peabody proclaims, the plant actually is a drag on the local economies of its various owners, which have a responsibility to provide the most affordable electricity possible. Navajo Generation Station cannot meet this test in large measure because the coal it buys from Peabody costs too much.”
Overall, Sanzillo calculates that the cost pressures at plants like Navajo translate into a US$50- to $90-million gap in Peabody’s financial performance (EBITDA) target for 2019. “This damage could begin to take its toll within a year of the company’s planned exit from bankruptcy. Truth is—these announcements aside—the bankruptcy plan had material defects already.”
In an unusual twist on the usual relationship between First Peoples and fossil energy development, IEEFA carried a report that the Navajo Nation is calling on Trump to stop the shutdown. The community is home to the coal plant and the mine that feeds it, and stands to lose 800 jobs from the closure. Navajo Nation Chair Russell Begaye said he would “seek a solution based on what we feel needs to be done,” including “tax breaks, subsidies, a real strong verbiage from the White House, from President Trump himself.”
But the Wall Street Journal, the source of the IEEFA report, cautions that “if Mr. Trump follows through on campaign pledges to support coal mines and plants, he would be fighting against a market reality. An abundance of low-cost natural gas, a fuel that competes directly with coal to generate electricity, has caused permanent shifts in the U.S.”