Justin Trudeau Using Taxpayers’ Money To Help Out Oil Giant TransCanada Pipelines With Energy East Costs?

Prime Minister Justin Trudeau is reportedly willing to use taxpayers’ money to pay for TransCanada’s assessment of GHG emissions for the long-delayed Energy East dilbit pipeline. The Telegraph-Journal reported that if TransCanada wants Ottawa to cover the cost of studying upstream and downstream greenhouse gas emissions, the government is ready and willing to lift the financial burden from the oil giant’s books.

In a September 20 statement from Natural Resources Canada, spokesperson Alexandre Deslongchamps said that the government has “offered to the National Energy Board and TransCanada to undertake the upstream and downstream GHG assessments to avoid added cost constraints for the proponent.”

According to the National Observer, Trudeau said that the government is open to taking on the costs and responsibility for the Energy East GHG assessment so that TransCanada doesn’t have to pay.

When directly questioned about his position on the offer, Trudeau said only, “I look forward to continuing to work with all premiers on protecting the environment and growing the economy.”

The controversial offer came after the Energy East pipeline National Energy Board review process “came to a screeching halt” earlier in September when the NEB released the list of issues that must be addressed. TransCanada immediately asked for a suspension so that they could consider how to address the new requirements.

Previously, the national energy regulator had not expressed concern over greenhouse gas emissions from the Energy East pipeline and the effect the line could have on the climate.

Many Canadians are outraged at the Trudeau government’s perceived betrayal and political interference.

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In the original list of issues when TransCanada first applied to build the pipeline, climate change was specifically excluded as a topic of discussion for Canadians wanting to have their say in whether or not the pipeline is built.

The NEB announced the new list in August, and it is the first time that consideration of air pollution and emissions from all stages of pipeline creation and operation appeared on a list of issues.

Prior to the new release, the NEB panel members were removed and the entire process was shut down after a conflict of interest came to light amid enormous public resistance to the project. Continued public pressure meant that the new panel had no choice but to recognize Canadians’ concerns about many aspects of the proposed project.

Along with greenhouse gas emissions and climate change, other problems now include the risk to municipal water supplies and the dangers of placing the dilbit line in close proximity to explosive natural gas lines.

Prime Minister Justin Trudeau's government has offered to help TransCanada pay the costs of a new ENergy East pipeline review.
The Energy East Pipeline would compromise City of Winnipeg drinking water supply. [Image by Ken Harasym/Council of Canadians Winnipeg]

Because of the new list of issues, New Brunswick’s pro-pipeline Premier Brian Gallant wrote a letter to Prime Minister Trudeau suggesting that the project might not be built at all. That letter appears to have hit home with the federal government as they attempt to navigate the tricky waters of pleasing voters who are adamantly opposed to the pipeline as well as oil interests that are increasingly desperate to turn a profit in a swiftly changing energy world.

According to CTV News, yet another new report puts into perspective the heavy costs of building pipelines, including TransCanada’s Energy East pipeline. Jeff Rubin of the Centre for International Governance Innovation said that the world is on a long-term trend of using less and less oil, meaning that building more pipelines will not pay. Many countries have made it a top priority to transition away from oil consumption, and the new report is “questioning the need for new pipelines.”

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UPDATE: The Telegraph-Journal has now reported that former TransCanada executive vice president Dennis McConaghy said the pipeline won’t go ahead unless the Trudeau government can assure the company that the pipeline will pass new environmental tests. McConaghy, who retains his shares in TransCanada, is insistent that the Energy East pipeline project will be killed if the NEB is allowed to be the arbiter of the new greenhouse gas emissions requirements.

“The Trudeau government would have to take the issue of emissions completely out of the hands of the National Energy Board,” he said. “That’s the minimum thing they would have to do for TransCanada to persevere here.”

The article goes on to speculate on the possibility that TransCanada may reduce the project to the conversion of existing pipeline from Alberta to Ontario and will “forgo its most controversial part” of new construction east of Ontario to a terminal in New Brunswick.

According to the University of Calgary’s School of Public Policy’s Ted Morton, the new emissions requirements would allow those opposed to tar sands expansion to submit a huge number of Information Requests (IR) to the NEB during the Energy East hearing process. TransCanada would have to reply to each IR, including reports, consultants, and expert witness statements. The entire process could become too burdensome to be worthwhile for the oil giant.

“That means more time, more money and more uncertainty.”

It remains to be seen how the Trudeau government will extricate themselves from this pipeline problem.

[Featured Image Jamie McCarthy/Getty Images]