Pipeline stack: Biden faces heat from Canada, Republicans, Michigan governor and propane price

[ad_1]

The bipartisan infrastructure bill has passed and Dems’ massive spending plan is one more step towards reality.

The announcement that the Biden administration was quietly studying the potential impact on the market of the destruction of the Line 5 pipeline, first reported by POLITICO, sparked a storm of criticism from Republicans claiming the move Would compound the surge that has already pushed propane prices up 50% from a year ago, as Michigan residents, the nation’s biggest fuel consumers, stocked up in cold weather. Propane is being pulled from the pipeline in the small port town of Escanaba to help supply communities on the state’s upper peninsula.

As we move into the winter months and temperatures drop across the Midwest, the Line 5 termination will no doubt exacerbate shortages and price increases in home heating fuels like natural gas and propane at a when Americans are already faced with rapidly rising energy prices, heating costs, global supply shortages and soaring gas prices, said Representative Bob Latta (R-Ohio) and a dozen other congressional lawmakers representing the region in a letter to Biden on Nov. 4.

But equal pressure is coming from environmental groups and Indigenous tribes to support Michigan Governor Gretchen Whitmer in her fight to shut down the pipeline. Groups say a potential oil spill from the 70-year-old pipeline that crosses the Straits of Mackinac would devastate the Great Lakes and Michigan coastal economies, a concern that grew after lines were damaged by an anchor strike in 2018.

Given the strength and oscillation of the currents, more than 700 miles of the shores of Lake Michigan and Huron would be seriously contaminated in the event of a spill, a group of 12 tribal nations wrote in their own Nov. 4 letter to Biden. . Unlike Canada’s voice support [pipeline owner] Enbridge, and despite what we understand to be requests for assistance from the Governors, your administration has been silent so far regarding Line 5.

The Canadian government also applies heat. Members of the Conservative Party in the nation’s government, already upset over Biden’s withdrawal from the crucial permit for the Keystone XL pipeline before it could even be built, said closing the Line 5 pipeline would require 2 100 cars to deliver oil from Superior, Wisconsin. , at the Imperial Oil refinery in Sarnia, Ontario, just across the US border.

An aboveground section of the Enbridge Line 5 pipeline is pictured at the Mackinaw City, Mich., Pumping station in this October 2016 file photo. AP Photo / John Flesher, File

Canada’s Foreign Minister Mélanie Joly discussed the pipeline with Secretary of State Antony Blinken on Thursday, according to a reading of their appeal. The Canadian government recently invoked a 1977 treaty to strengthen its position that oil continues to flow.

Canada’s Natural Resources Minister Jonathan Wilkinson told reporters on Friday he called Energy Secretary Jennifer Granholm that day to discuss the pipeline. Wilkinson told reporters that the continued operation of the pipelines was not negotiable. Canada hoped the issue would be resolved in the coming months, but was making contingency plans in case the line was shut down, Wilkinson added.

It is certainly prudent for governments at all levels to consider what happens in the event that we are unable to resolve the Michigan issue and succeed in court, Wilkinson told the journalists. But I would say it’s a contingency plan that we hope we never have to use.

All of this means that Biden, who pledged during the COP26 climate talks that the United States would hopefully lead by the power of our example, faces the kind of cold, hard political decision that such ambitions. climate change can impose on a country that is the world’s largest producer of oil and gas, said Kevin Book, managing director of energy consultancy firm ClearView Energy: either keep the pipeline in place and disappoint progressives, or revoke its license and hand Republicans new ammunition right after bombing Virginia Democrats and other state elections.

When fuel prices are high, it doesn’t matter which project is shut down, as long as the White House is seen shutting it down, Book said. Politically speaking, anything that could hamper the propane supply before winter could play out in the swing states of the Midwest.

The administration has yet to decide what to do, sources close to the White House said. Market research has concluded that Michigan gasoline prices would increase by a few cents per gallon if the pipeline were pulled. But propane, currently near $ 2.50 a gallon, could rise between 5 and 25 cents before supplies can be redirected there from other sources, including other pipelines in the area. Supporters of the pipeline shutdown have suggested that its phased shutdown could mitigate any impact on prices.

“With an orderly closure and this key: orderly closure, there will be little noticeable impact,” said Beth Wallace, head of conservation partnerships at the National Wildlife Federation, an environmental group that commissioned an effects study. closing the line. .

Still, any increase would become a Republican talking point and could make it harder for Democrats to take more ambitious energy policy action. The GOP has already hammered Democrats for current increases in fuel prices that have little to do with White House policy, and voters would certainly notice if something coming directly from the administration increased prices further.

But Republicans are already exploiting voters’ frustrations over the surge at the pumps that has pushed the average U.S. gasoline price up by $ 1.30 from last year to $ 3.42 a gallon. . They have aggressively sought to tie this increase to Biden’s move on the Keystone XL pipeline and his hiatus on new federal land auctions to oil and gas drillers, although energy experts have said the increase is due largely due to the tightness of the world’s energy supply after the industry ran into problems last year when prices plummeted at the worst of the pandemic.

Republican Senator Lisa Murkowski of Alaska, a state heavily dependent on oil and gas production, said voters are particularly sensitive to fuel costs and could backfire on politicians they see as doing all that. could increase prices.

Whenever people focus on something like the high price of gasoline at the pump, or if natural gas prices are high and they see their utility bills higher, the focus is on this, Murkowski said in an interview. And I think that has an impact on how they perceive long-term policies. I think we recognize that the price of oil can come and go, the price of natural gas will come and go, but I think it has a big impact on what people think of different legislative or policy initiatives.

Anthony Adragna contributed to this report

[ad_2]