Last week, Kinder Morgan reported a leak of 12 barrels of oil. This week, Canadian Pacific (CP) rail reported a leak of 575 barrels of oil from a rail car. Why are we carrying oil on rail cars? Because environmentalists are derailing the construction of new pipelines.
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| Source: Canadian Association of Petroleum Producers |
Oil sands oil is definitely one of the most dirty sources of oil in the world. The trouble is, Canada does not yet have an alternate energy plan. Consider Canada to be your household: Would you stop driving your car to work, and take a taxi each day, because your car burns more gas than the taxi drivers? This is, in essence, what Canada is doing. Harper has polarized the argument between pipelines and green energy so much that we are shooting our cash cow dead, and not developing a viable alternate economic plan.
What is an alternate plan? Consider our neighbors to the south. Last month, Tesla motors repaid their $465 million dollar loan from the US Government. Ford Motors and GM had multi-billion dollar loans from the US and have not repaid. Albeit the reasons for Tesla's profitability are no franchises (selling cars from Tesla-owned boutiques instead), and the US Environmental Protection Agency's (EPA's) Corporate Average Fuel Economy (CAFE) regulations for energy efficiency in cars. Under this regulation, manufacturers that cannot comply with the average fleet gas mileage can buy gas mileage credits from other companies. During the quarter that it posted profits, it made $68 million from CAFE credits, $17 million from GHG emmisions credits (another green energy program), and $91 million from selling cars - their profit of $11 million was not made by selling cars, but collecting credits.
A scheme like this this is exactly what Canada should do with its oil sands oil. We should definitely sell oil sands oil and shale oil. We should trim the profits from these companies and invest in viable green alternatives - Companies like Canada Lithium, a Canadian lithium mining company, and Canadian Solar, a Canadian solar panel manufacturer.
Protesting against oil pipelines actually causes Canadian companies to transfer wealth to American Companies. This is easily shown by the disparity between Brent crude and west Texas intermediate (WTI). Brent crude is the price from the North Sea. The spread between these two markers is predicted to spread to $12 for 2013. Basically, Canadian oil companies are paying $12 per barrel of oil to American companies for having a market to buy Canadian oil.
Why not build a pipeline to either Eastern Canada (for example, TransCanada's Energy East pipeline) or a pipeline to the West (like Kinder Morgan's twinning, or Enbridge's Northern Gateway), reap higher profits, and invest these profits into actually doing something substantive to change our lifestyles? Invest in greening our energy infrastructure - without shooting ourselves in the foot.
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