Monday, February 13, 2012

The Keystone Pipeline and the Futility of "Green" Boycotts

An interesting debate is playing out between the NY Times Joe Nocera and Joe Romm and friends.  You can read the details here.  I would like to add one simple point.  When has a boycott succeeded?   If Canada doesn't sell us their fossil fuel, will it really sit in the ground and not be consumed?   Global GHG emissions would be lower if such natural resources weren't tapped.  This is really an issue of transportation costs and economic incidence.  If the pipeline had been built connecting Alberta, Canada to U.S consumer destinations, what would have been the gains to trade?  In the absence of this pipeline, will this natural resource now be shipped to Asia?  At what transportation cost and what are the gains to trade?  So, does not building the pipeline have a causal effect on the dirty resource staying in the ground?  China smells an arbitrage opportunity here and is stepping in.  Have well meaning greens defended their "line in the sand" or have they merely diverted oil that will be consumed anyway?  World trade poses a challenge to the boycotters.    This is a classic example of leakage and represents a reason why I wrote my climate change adaptation book Climatopolis.  

As a fan of sharp GHG mitigation, and as a technological optimist, I believe that Dr. Romm and his friends should point their efforts to developing electric vehicles and the spread of cheaper renewable power generation.    Yelling and screaming at fossil fuel exporters to quit exporting isn't going to achieve much in a globalized world trade economy.