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Keystone XL: Not the Jobs Plan the Oil Industry Pretends

Susan Casey-Lefkowitz's picture
NRDC

For over 20 years, I have worked with partners from too many countries to count as an environmental advocate. I started off working for IUCN's Environmental Law Center in Germany - working...

  • Member since 2018
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  • Mar 10, 2013
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jobs promised by keystone xl pipelineThe State Department draft environmental review of the Keystone XL tar sands pipeline shows how TransCanada, the American Petroleum Institute and other proponents of the pipeline have been vastly overstating the number of jobs that will be created by this dirty energy project. This creates unfair expectations among workers who need jobs, not empty promises from the oil industry. The State Department, based on TransCanada’s own numbers, shows that at the most 3,900 construction jobs will be created in building the pipeline with only 10 percent of the total workforce hired locally. Only 35 permanent jobs will be created by the pipeline. What is more, the State Department dismisses the evidence that Keystone XL is actually bad for the economy and many workers.

Keystone XL will run from Canada, across America’s breadbasket, to the Gulf Coast where tar sands will be refined and much of it will be exported so that the oil companies can enjoy the higher prices of international markets. The State Department’s draft review does not take the economic well-being of farmers and communities along the pipeline path into account, neglecting to assess the potentially negative impacts of pipeline spills, spills into freshwater supplies or increases in climate and other pollution on employment and the economy, as was done by the Cornell Global Labor Institute. Farming, ranching, and tourism are major sources of employment along the Keystone XL pipeline’s proposed route – approximately 571,000 workers are directly employed in the agricultural sector in the states along the Keystone XL corridor. Water contamination resulting from a Keystone XL tar sands spill, or the cumulative impact of spills over the lifetime of the pipeline, would have significant economic costs.

We can do better for our workers and economy than a dirty energy project such as the Keystone XL tar sands pipeline. As a result of our clean energy industry’s rapid growth and effective state and federal policies, clean energy projects and programs currently in progress are creating thousands of jobs in communities across the country without the risk.  And many more shovel ready projects could be brought online if our policymakers are willing to send clear market signals and level the playing field for clean energy options to move forward.  

A new report from Environmental Entrepreneurs, an organization that represents over 800 business leaders, shows that companies and communities announced more than 300 clean energy and clean transportation projects in 2012 that are expected to create 110,000 jobs. These jobs are helping to revive manufacturing in states like North Carolina and Ohio, cutting energy costs for homeowners and businesses, and scaling up new industries like clean vehicle manufacturing. 

Take for example companies like Energetx, a wind blade manufacturer in Holland, MI which added 100 jobs in 2012 and expects to hire up to 1,000 by 2016; Global Green Lighting, a pioneering manufacturer and installer of radio-controlled LED lighting systems in Chattanooga, TN’s parks and neighborhoods that has plans to hire 50-75 additional employees the first quarter of this year, and Isofoton North America, a solar panel manufacturer in Napoleon, OH that has hired 40 employees in 2012 and is looking to employ up to 120, including 50 Ohio veterans, soon this year. These clean energy jobs add up and contribute to fighting climate change. And in New York, just the 2nd Avenue subway project will create 22,500 direct construction jobs at the same time that it will help reduce pollution, address climate change, and provide working families better transport options.   

Now is the time to find ways to put people back to work without increasing the risks from climate change to our economy and health. The Keystone XL tar sands pipeline is a dirty energy project that is not worth the risk and should be rejected as not in our national interest.

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John Miller's picture
John Miller on Mar 10, 2013

Stating that the Keystone XL pipeline project job creation is insignificant and harmful to economies is not supported by the facts:

You state: “The project only creates 3,900 constructions and 35 permanent jobs?”  Cost of the project is estimated at $7 billion and typical pipeline project labor costs average about 25% of the total project.  Since the project schedule is 2 years this means the average of your claimed 3,900 pipeline construction jobs would pay $250,000 per year.  I wonder how many unemployed construction workers and Unions might want to lineup for these jobs?  Your 3,900 jobs estimate also excludes the many 1000’s of jobs needed and created for fabricating the materials used to construct the project, starting with the steel pipe & fittings, pumps, foundation materials, electrical equipment, electronic controls, etc.  The permanent job estimate of 35 also appears to grossly underestimate or ignore the jobs created for annual pipeline infrastructure maintenance (pumps, electrical, controls, etc.).  And, what about the local goods & services purchased by these many thousands of construction workers and operations staffing.  The number of these services jobs created as a result of significantly expanding local economies also will not be insignificant.  To imply that an infrastructure project funded by private companies is somehow inferior to roads & bridges infrastructure projects normally funded by Government’s, makes no sense, and even from a Keynesian Economics theory standpoint.

You further state: “The syncrude would be refined and exported to the (sole) benefit of the Oil Companies?”  Due to the combination of reduced U.S. petroleum consumption and poor economics over recent years a number of major U.S. refineries have shutdown and many refineries are operating at less than maximum capacity.  Restarting and utilizing idle refining capacity may lead to increased petroleum exports.  This situation will also recreate the operations, maintenance, administration and local service jobs lost due to the recent shutdowns and capacity idling.  Since when was maximizing the utilization of existing manufacturing facilities and capacity, recreating jobs and increased employment, and increasing exports a bad outcome for any nation?  What has been a major source of economic strength and vitality for countries, such as Germany, since World War II?  Possibly the ability to export their goods to other countries and maintain the health of their domestic economies?

Anyway, assuming that blocking the Keystone XL will significantly and tangibly reduce World carbon emissions is a very poor assumption based on the facts.  The oil will find its way eventually into world markets and in the meantime the U.S. economy and energy security will suffer.  Weakening any country’s economy will not increase the development and production of renewable energy or the associated jobs.

Wilmot McCutchen's picture
Wilmot McCutchen on Mar 10, 2013

So what do the 99% in Alberta think?  "Rip and ship" is not what they see as good for the province, which is suffering from a $3 billion budget deficit.

"Alberta Federation of Labour president Gil McGowan told the committee that upgrading bitumen in Alberta should be a condition of resource development, not an option, because it creates jobs and adds value in Alberta.

“It is our resource and it is we, the citizens of Alberta, who should be seizing the value opportunity, not some foreign-based energy giant,” McGowan said. “It may make all sorts of sense … for Exxon and Sinopec to rip and ship our raw resources, but just because it makes sense for them, it doesn’t mean it makes sense for Albertans.”"

  http://www.edmontonjournal.com/business/Advocates+spar+over+government+investment+bitumen/8020259/story.html

 

Bob Meinetz's picture
Bob Meinetz on Mar 11, 2013

John,

Here's an option: why don't we take the $4 billion in tax breaks afforded oil companies every year and apply it to rebuilding US infrastructure? We get twice as many jobs, year after year; we make the United States a better place; and the higher production price of tar sands oil sans Keystone XL means more of it stays in the ground, preserving Canadian air, forest, and waterways.

The oil and gas industries raked in 2012 profits totaling $62 billion while actually making less gasoline, so I hardly think they'd miss it. A win-win-win.

Paul O's picture
Paul O on Mar 11, 2013

The problem with these energy post-ups is that it has become almost impossible to find commentary that is devoid of Ideological bias from "renewables" advocates, and no two subjects illustrate that bias better than Keystone and Nuclear power.

I don't even bother reading anything from Mr. Romm anymore...it's a complete waste of time.

Pieter Siegers's picture
Pieter Siegers on Mar 11, 2013
Bob Meinetz's picture
Bob Meinetz on Mar 11, 2013

Yes, it's true. The unredacted version here.

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