Cross-sector carbon offsets: how to sell Keystone to Obama

Canada’s Conservative government has been driving hard for years to help TransCanada Corporation persuade the U.S. president to approve the Keystone XL pipeline. The Conservatives must be wondering how it is that pipelines have caused them so much grief. In their seven and a half years in power since they defeated a seemingly unbeatable Liberal dynasty in early 2006, they have batted exactly 0.000 on major pipeline projects.

All pipeline construction projects are one-offs, of course, and each one comes with its own unique constellation of technical, economic, and political issues. So the failure of the Mackenzie Valley Pipeline—the first of the major projects the federal Conservatives put enormous time and effort into—has little to do with the difficulties in getting Keystone approved in the U.S. Mackenzie was killed by economics: the low price of natural gas, which it would have carried, made the project unprofitable for the companies that would have sold the gas.

As a politically problematic pipeline, Keystone is in its own category. It won’t carry gas, as the Mackenzie line would have: it will carry liquid synthetic crude. And manufacturing liquid synthetic crude is a carbon-intensive process: you need heat to soften the bitumen—tar-like raw material—and you need hydrogen to put into the tar molecules to change their state from quasi-solid to liquid. Heat and hydrogen both come from burning and reforming methane, a.k.a. natural gas. This is, ostensibly, the origin of the environmentalist opposition to bitumen processing in general and the Keystone pipeline in particular. Environmentalists profess to be offended by the higher lifecycle carbon emissions entailed in using syncrude-derived motor vehicle fuel. These higher lifecycle emissions have emerged as the most damning indictment against the Alberta oil sands. So much so that the U.S. president, anxious for just one positive development in his six-year campaign to cut carbon, has signaled that there will have to be a significant carbon reduction, somewhere, if the pipeline is to be approved.

The Canadian Conservatives are therefore in full brainstorm mode, trying to figure out what carbon reductions they could put in front of the president that he could then wave in front of his environmental supporters. What carbon reductions could they possibly point to?

They should look no further than Ontario’s electric power generation sector. In 2001, carbon emissions from this sector were over 40 million tons. In 2012, they were 16 million. That is a 25 million ton annual reduction, by far the biggest in any sector since the Kyoto Protocol. How did it happen?

It happened because six nuclear reactor-generators were brought online in Ontario’s electric grid. These reactors represent over 4,000 megawatts of generating capacity. Over a single year, these machines can produce between 28 billion and 33 billion kilowatt-hours of electricity. Because they run on nuclear fission, they produce no carbon waste. This is in stark contrast to generators that run on fossil fuels like coal and natural gas. If gas-fired generators were to produce 28 billion kilowatt-hours over a year, they would dump roughly 15.5 million metric tons of carbon dioxide, the main byproduct of combustion, into our air. That’s enough to fill up a standard-size Major League Baseball domed stadium more than 5,300 times. (Remember, that is just one year’s worth of carbon waste.)

Nuclear is the Number One reason Ontario’s electric power generation sector has achieved such impressive annual carbon reductions since 2001.

Now, what does this have to do with the federal government of Canada? Electricity in Canada is almost entirely a provincial, not federal, affair.

Well, Ontario’s nuclear generators, which have since the early 1970s provided by far most of the power that runs the province, were developed in a partnership between Ontario Hydro (the provincial electric utility) and Atomic Energy of Canada Limited (AECL, the federally owned inventor of the CANDU nuclear reactor). The CANDU reactor is one of Canada’s seminal engineering achievements, and it was jointly developed by the federal government and the Province of Ontario.

Nuclear is the Number One reason Ontario’s electric power generation sector has achieved such impressive annual carbon reductions since 2001.

This means the federal government could, with strong justification, make a credible case that it deserves credit for Ontario’s enormous carbon reductions since 2001.

Moreover, the federal government could and should reexamine how it might facilitate further nuclear uptake in Canada. Federal nuclear technology has proved itself in Ontario: it has proven it can operate reliably, cheaply, and safely for decades. It has proven it can power Ontario, one of the richest and most modern economies in the world, without dropping a single gram of carbon into the air.

Ontario’s nuclear powered carbon reductions are the biggest in any sector in North America. The Canadian federal government should trumpet this: it might just help to sell Keystone to the Americans.

I know—the fight over Keystone is, ostensibly, about carbon from the Alberta oil sands, not the Ontario power generation sector. The operative word being, ostensibly. Of course it is not about carbon: if it were, then those who oppose the line would, after doing some very rudimentary research followed by grade-school arithmetic, realize that carbon emissions from oil sands-derived transportation fuel are small potatoes compared with those from power generation in the same country that would host most of the Keystone XL line. U.S. power generation carbon emissions are immense: around two billion tons every year, mostly from coal and gas. Oil sands processing puts 50 million tons, less than 2.5 percent, into the air every year. Oil sands carbon is puny compared with U.S. power generation.

All the more reason Canada’s government should point up the carbon reductions in Ontario. Those reductions are from the sector that has proved one of the most intractable in the U.S.

And besides: the U.S. president a couple of years ago supported a cap and trade bill out of the House of Representatives, Waxman-Markey. While it was an unworkable product of typically cockamamie pseudo-environmental groupthink, Waxman-Markey contained the concept of offsets, which are a mechanism for organizations in one sector to buy down carbon emissions in another sector. If the president supported Waxman-Markey, maybe he is not opposed to offsets.

Well, TransCanada Corporation, the company that wants to build Keystone, just happens to be a major partner in an outfit that runs the biggest clean energy centre in the western hemisphere, the Bruce nuclear plant in Ontario. TransCanada should trumpet this fact. So should the Canadian federal government.

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7 years ago

It is true that production of crude oil from oil sands is more CO2 intensive than other methods. However, the added CO2 is but a quibble when total CO2 production over the whole chain from underground to tailpipe is taken into consideration. The pseudo-environmentalists are stepping over a dollar to pick up a dime by not promoting the use of nuclear energy for generation of electricity (regardless of weather), where the tremendous power to reduce CO2 emissions is well known. If this group were forward thinking, they would advance the use of nuclear process heat for the production of crude oil from oil sands, and refining.

Jeff Walther
7 years ago

I admire your imaginative creation of a solution, however I believe there is at least one intractable obstacle to your plan working.

President Obama is utterly anti-nuclear. He claims in public to be pro-nuclear, yet in the real world of action, everything he has done has created further obstacles to nuclear or failed to remove easily fixed obstacles.

Loan guarantees for new reactors? Offered on such unfavorable terms that reactor builders would rather do without them than agree to the ridiculous costs.

On the regulatory front, Obama appointed Reid’s incompetent minion, Jackzo, as chairman of the US NRC. But Jackzo, while incompetent at the job for which he had the title, was competent enough to illegally kill the Yucca Mountain Repository. Followed by the appointment of Jackzo’s replacement, another of Reid’s anti-nuclear minions, Macfarlane.

Additionally, Obama appointed Moniz as Secretary of Energy, who is also anti-nuclear in action, but claims to favor it verbally. Moniz’s first act was to appoint a staffer from the radically anti-nuclear Union of Concerned “Scientists” as his chief of staff.

These are the acts of an administration which is opposed to nuclear. Now it is possible that Obama is ill-informed and following poor advice which leads to a different result than the result that he favors. If so, that saboteur has been ridiculously effective and there’s no reason to believe that he or she will not continue to sabotage any positive action relating to nuclear electricity production.

I write this as a person who voted for Obama, and am utterly disappointed in almost his entire presidency. It is no surprise that he has failed to make any effective progress against CO2 emissions. The methods he has favored and promulgated are all doomed to failure. No nation can reduce CO2 emissions and maintain a first world standard of living by converting their electricity generators to Unreliables.

It’s possible that your solution would be acceptable to Obama (or his handler) because it only leads to verbally pointing out how nuclear has reduced CO2 and isn’t actually an action which would cause more nuclear to be built in the USA. It’s hard to know.


Finally, one question/nitpick. You write (paraphrased) ~16 million tons of CO2 would have been emitted if gas instead of nuclear supplied 4 GW capacity. I thought the number should be much higher. I would appreciate correction if I have some fact wrong.

From BraveNewClimate I believe that a 1 GW coal plant burns about 4 million tons of coal per year. I have read that gas produces about 1/2 the CO2 that coal does for the energy produced. Chemically, burned coal should convert to about three times the mass in CO2*.

So 4 GW * year ==> 4 X 4 million tons coal/year = 16 million tons coal/year =~ 48 million tons CO2 emitted/year ==> 48/2 million tons CO2 emitted per year because gas was burned instead of coal.

Result =~ 24 million tons of CO2/year.

Of course this is within 50% of your number and with all the estimates and rules of thumb in my estimate… Still, it’d be nice to know where the difference lies.

* One carbon atom (~atomic mass = 12) gains two oxygen atoms (~atomic mass = 16 each). Result is more than three times the mass, but not all of the coal burned is carbon. Some remains as cinder. Should be a reasonable estimate, I think.