Carbon Costs of Trans Mountain Could Hit $8.7 Billion Up Front, $4.1 Billion Per Year

The Trans Mountain pipeline expansion will trigger additional greenhouse gas emissions worth C$2.1 to $8.7 billion per year up front, and $675 million to $4.1 billion per year for as long as it operates, based on a social cost of carbon between $45 and $270 per tonne, environmental journalist Stephen Leahy calculated earlier this year in a post for Vice Motherboard.

“Although Canada’s government agrees there are real costs to decisions that result in releasing more CO2 into the atmosphere—costs that are reflected in our tax bills, insurance claims, and ill health—politicians never seem to total up those costs,” Leahy writes. So here’s his math:

If it’s built, the Trans Mountain expansion will carry 590,000 barrels of heavy oil per day, bringing the pre-existing pipeline’s total capacity up to 890,000 barrels.
The additional output of 590,000 barrels per day would produce 13 to 15 million tonnes of upstream carbon dioxide emissions per year, according to federal government figures.
Environment and Climate Change Canada “says its upstream emission estimate does not include emissions from the destruction of forests and wetlands, nor from producing the electricity or fuel used in transportation,” Leahy writes. Nor did the department calculate how much land would be affected.
15 megatonnes of new emissions, the equivalent of 3.75 million new (internal combustion) vehicles on Canadian roads, would translate into $675 million per year with the social cost of carbon pegged at $45 per tonne, and Ottawa recognizes that the cost will increase over time. “Of course, it’s not just Canadians who will have to deal with this,” Leahy writes. “The impacts will be global, with the poorest countries hit hardest.”
Economists Joseph Stiglitz and Nicholas Stern pointed out in 2017 that social cost of carbon calculations “fail to consider many vitally important risks and costs associated with climate change,” including biodiversity loss, ocean acidification, long-term impacts on labour productivity and economic growth, impacts on the poorest, and the possibility of extreme and irreversible changes. Those gaps help justify a 2015 study by Stanford University researchers that put the actual social cost of carbon at $275 per tonne. That benchmark is the basis for Leahy’s high-end estimate of $4.1 billion.
The next issue is the impact of new tar sands/oil sands operations triggered by the availability of more pipeline space. “Figuring out the emissions from the destruction of forest and wetlands is difficult but important, given the immense size of tar sands projects,” Leahy writes. “Just under half of these projects involve surface mining, a process that digs up layers of peatland and sand 50 metres deep to get at the tarry bitumen.”
Producing half of Trans Mountain’s output from surface mining would mean digging into 34,000 hectares of boreal forest and peatland. Based on a 2012 study, that activity would release 1,400 to 5,700 kilograms of stored carbon dioxide per hectare, or up to 194 megatonnes—translating into an additional cost of $2.1 to $8.7 billion at a social cost of $45.