As U.S. moves towards reducing carbon pollution – there is no room for tar sands oil expansion

Despite attempts by oil companies and Canada to say otherwise, the movement in the United States to reduce carbon pollution leaves no room for expansion of high carbon dirty fuels like tar sands oil from Canada. Just a few months into the new Administration, the House Energy and Commerce Committee under Chairmen Waxman and Markey have kept up a fast pace of negotiations around the language that will move through the House as the American Clean Energy and Security Act. The new climate legislation is sending a signal to our trading partners that we have gotten serious about fighting global warming - at home and internationally. It comes as part of a groundswell among U.S. states and agencies to regulate carbon emissions.

Today, a new draft of the climate bill was made public. This overhaul of U.S. climate and energy policy covers clean energy, energy efficiency, reducing global warming pollution, greenhouse gas standards and transitioning to a clean energy economy. The heart of the bill is a cap on greenhouse gas pollution that has a steady schedule for reductions.

The Administration is preparing for the international climate treaty negotiations in Copenhagen in December having made a commitment to fight climate change and to reduce U.S. greenhouse gas emissions. As lead U.S. negotiator Todd Stern stated recently, "high-carbon goods and services will become untenable" in the wake of international efforts to address climate change. Part of the bill's goals are to reduce greenhouse gas emissions globally. This sends a clear signal that the U.S. cares about strong global efforts to reduce carbon pollution - including in our trading partners. The bill provides for purchase of allowances for example where certain exporters from countries with high emissions that do not have comparably stringent greenhouse gas emissions regulations to the United States.

Especially under attack in the earlier draft of the bill was a low carbon fuel standard - that would have provided a market incentive for refineries to look for low carbon fuel alternatives, rather than expanding to take more of the higher carbon fuels such as Canadian tar sands oil. Under intense opposition from dirty oil interests, rather than end up with a weak provision, the low carbon fuel standard was removed from the bill. But the beauty of the groundswell of action to reduce carbon emissions in America means that low carbon fuel standards are emerging or being discussed at the state level (California, Oregon, Washington, Florida, the Northeast and the Midwest). And the recent determination by EPA that it can regulate greenhouse gases means that EPA has the authority to set a low carbon fuel standard under the Clean Air Act. A low carbon fuel standard is part of the emerging package of American regulation of carbon pollution - whether it finds a home in this particular climate bill or not. As it finds its home at the state level and eventually at the federal level, it will send a clear signal that the U.S. is concerned about how our fuel consumption causes emissions along the entire life of a fuel - including its production such as with tar sands oil in Canada.

In the midst of all of this momentum to fight carbon pollution in the United States, instead of behaving as our "friendly neighbor to the north", Canada has been strangely aggressive - threatening trade repercussions and lobbying against infant U.S. climate regulation. Although given the strength of dirty oil interests in Canada, perhaps this aggressiveness is not so strange. Canadian tar sands oil development is the fastest growing source of greenhouse gas emissions in Canada and was recently cited as one of the most important reasons Canada will miss its Kyoto targets by over 30%.

Instead of strengthening and implementing its own climate regulations, Canada argues that its intensity targets for greenhouse gas emissions are similar to U.S. proposals. But intensity targets, unlike the planned U.S. cap, allow emissions to increase as an industry expands. A recent report from the Canadian National Roundtable on the Environment and the Economy found that Canada's policies were at such odds with the U.S. that they risk "potentially ruinous trade retaliation from the United States." Canada argues that carbon capture and sequestration (CCS) will "fix" its carbon footprint, even though CCS for tar sands is technically difficult, very expensive, and not backed by timelines or funding commitments, and would only capture 10%-30% of the production part of the lifecycle emissions of this fuel. Canada also argues that it will send its tar sands oil to Asia if the U.S. puts policy measures in place that put the high carbon tar sands oil at a market disadvantage. What is not made clear is that there is currently no pipeline to take tar sands oil to the west coast and that permitting through the territory of many indigenous communities that are in opposition is likely to be a non-starter. The pipeline would also require the lifting of what has amounted to a long-standing tanker traffic moratorium in the coastal waters, an effort that has already raised strong local and international opposition.

Paul Krugman said in a commentary about China and climate today that "As the United States and other advanced countries finally move to confront climate change, they will also be morally empowered to confront those nations that refuse to act. Sooner than most people think, countries that refuse to limit their greenhouse gas emissions will face sanctions, probably in the form of taxes on their exports. They will complain bitterly that this is protectionism, but so what? Globalization doesn't do much good if the globe itself becomes unlivable." Shouldn't Canada be one of those "morally empowered" countries and not one of the "complainers"?

Consideration of the American Clean Energy and Security Act will start next week and action by the full House will follow, as will action in the Senate. It marks a new era in the U.S. and tar sands interests can't hold back the U.S. move towards clean energy.