In his column, “If Alberta oil heads east, benefits for Ontario are hard to see” economist Jeff Rubin makes a number of errors about TransCanada’s proposed Energy East crude oil pipeline.
If the Energy East project were to be built, it would deliver another 1.1 million barrels a day to the Atlantic Ocean where it could end up in coastal refineries and improve the pricing picture even further. The benefits for Ontario are harder to see.
Energy East will create 10,000 full-time jobs – good paying jobs for Canadians to provide for their families. In Ontario, Energy East will create 2,300 direct jobs during development and construction and 6,000 spin-off jobs.
Then there are the longer-term benefits – $13 billion in GDP for Ontario’s economy over the project’s lifetime, and $3.5 billion in government tax revenues to repair roads, build schools and hospitals, upgrade crumbling buildings – the list goes on. For many communities, the money TransCanada will pay will replace lost revenue from mills, mines and other facilities that have been shut down. The $13 billion that the project will contribute to Ontario’s GDP during development, construction and operations is equivalent to the annual contribution from Ontario’s auto industry.
An offer from TransCanada to build a new natural gas line to the province seems good on the surface, but considerably less magnanimous when you consider it’s asking the Ontario Energy Board to approve a 52.3-per-cent increase to the rates it charges to some of its customers. Why natural gas users in eastern Ontario should subsidize the transit of Alberta bitumen through their backyard remains unclear.
We are building new pipeline infrastructure in Ontario to ensure Ontarians will receive gas when they need it to heat and cool their homes and cook their food. TransCanada is committed to putting forward a proposal to the National Energy Board that ensures the costs for our natural gas customers will not increase as a result of Energy East.
Nor will Energy East be ‘subsidized’ by Ontario and Quebec natural gas customers. In fact, we expect gas transmission costs to drop because the Energy East conversion will reduce the Canadian Mainline cost of service which will benefit our shippers.
If Alberta can be considered the culprit behind Canada’s sad track record on carbon emissions, then Ontario’s acquiescence to the Energy East pipeline would make it a willing accomplice.
The facts show Energy East will not substantially affect the rate of extraction or combustion of Canadian oil sands crude and its global impact. More importantly, if Energy East is not built, the oil will move by truck, rail and tanker instead of a pipeline, the safest and most environmentally responsible method of transporting oil and natural gas over long distances.
Read the full version of TransCanada’s Letter to the Editor
Complete article: Globe and Mail – Published July 7, 2014