Ontario Energy Board Energy East Consultation
Council of Canadians Written Submission, Part Two of OEB Energy East Consultations
300-251 rue Bank St, Ottawa, Ontario K2P 1X3 Tel./Tel.: (613) 233-2773, Fax/Telec.: (613) 233-6776 www.canadians.org [email protected] The Council of Canadians has welcomed the opportunity presented by the Ontario Energy Board’s (OEB) consultation to share our views on TransCanada’s proposed Energy East pipeline. We have participated throughout this process, including organizational representation at the stakeholder and consultation sessions, as well as encouraging the participation of our supporters and volunteer chapters.
The Council of Canadians is one of Canada’s leading progressive advocacy organizations with more than 100,000 grassroots supporters, including more than 40,000 in Ontario, and local volunteer chapters across the country, including 16 in Ontario. Through our campaigns we advocate for clean water, fair trade, sustainable energy, public health care, and a vibrant democracy.
The Council of Canadians believes the Energy East pipeline presents many risks and little reward for Ontario. We are urging the Ontario government to publicly oppose the project.
We maintain that the risks identified in our first submission to the OEB remain relevant. These include the risk of a diluted bitumen spill in Ontario waterways, TransCanada’s pipeline safety record, the climate pollution implications of filling the pipeline, and increased reliance on fracked gas imports from the U.S. We continue to question proposed benefits, given that Energy East is primarily an export pipeline that will provide few long-term jobs.
Building on our previous submission, the below content provides feedback on the final technical reports prepared for the Ontario Energy Board and additional evidence supporting our position.
We urge the OEB to encourage the Province of Ontario to request a halt to the ongoing National Energy Board (NEB) review of the Energy East project.
There are multiple reasons why this needs to take place. Most notably, Ontario First Nations have requested a halt until they are properly consulted.i TransCanada’s application is also incomplete – a clear conclusion of the technical reports commissioned by the OEB. The decision to drop the proposed Cacouna export port also leaves many of the project details and route for Quebec residents in flux. The failure to provide this information in a timely way to allow for informed participation in the forthcoming NEB review significantly limits meaningful engagement.
The unacceptable risk of a diluted bitumen spill in Ontario waterways
The Council of Canadians maintains that the transport of diluted bitumen, particularly given the potential volume that could be transported and spilled by the 1.1 million barrel per day Energy East pipeline, is an unacceptable risk to Ontario waterways. Since our previous submission to the OEB,ii further evidence has come forward affirming deficiencies in our understanding of how diluted bitumen reacts in water, and the implications of a spill. A draft federal report on diluted bitumen, brought to the public’s attention thanks to an access to information request, identifies a number of knowledge gaps about the behaviour and effects of diluted bitumen.iii These include diluted bitumen’s toxicity and its implications for aquatic environments.
The DNV-GL Assessment of Impacts on the Natural Environment brings to light a number of disconcerting gaps in TransCanada’s application (while noting additional information is to be filed). Of particular concern is missing information on potential impacts to surface and ground water intakes, TransCanada's refusal to consider rerouting options for the converted portion of the pipeline in light of proximity to waterways, and lack of worst case scenario spill modeling (especially in the multiple cases where the pipeline comes near or crosses drinking water sources). How can the OEB inform the Ontario government effectively to represent this province’s interests based on an incomplete assessment?
The Council of Canadians understands the constraints on the OEB’s timeline in light of the federally imposed NEB review timeline, but this should be recognized as a deficiency in the process.
In regard to the risk posed by the Energy East pipeline to the Oxford Aquifer outside of Ottawa, the DNV-GL report states, “despite the comprehensive treatment of groundwater resources in TransCanada’s Application, DNC GL comments that elevated public concern about impacts in the Oxford- Marsh, Nepean and other aquifers will persist...” Indeed, our concerns persist and we believe there is good reason to question whether TransCanada’s treatment is comprehensive. TransCanada’s conclusion is partly based on the following, “Generally, the rate of crude oil transport through soils is very slow and the extent of plume dispersion is limited to 100m or less (Newell and Connor 1998).”iv
Does this rate appropriately reflect the unique features of the Oxford Aquifer, which is classified as highly vulnerable to contamination by the Ontario government? It is unclear whether this was considered in the DNV-GL assessment. The aquifer is highly vulnerable because the soil above it is mostly very thin and unable to absorb much. The rock under the soil has many holes and fractures that liquids could travel down towards the drinking water source. These concerns have been consistently raised by Sustainable North Grenville, a local group of concerned citizens.v
It is challenging to accept the prospect of a major oil spill in the area being of little concern considering that a recent provincial study highlights the potential of a spill from a home heating fuel storage tank as presenting a serious concern for potential contamination. Local Sustainable North Grenville member Ian Angus further adds, “In 1991, in Manotick [nearby community], a tank containing dry cleaning solvent leaked, poisoning 74 local wells. Manotick had to spend millions of dollars to build a new water distribution system. The town still pipes its water from Ottawa, because the local water supply still isn’t safe, 22 years later.”vi More than 10,000 people in North Grenville rely on a healthy Oxford Aquifer to supply their drinking water. And it was ultimately the threat of a spill from TransCanada’s Keystone XL pipeline (comparatively smaller by volume) that informed widespread opposition in Nebraska where it traversed above the Ogallala Aquifer that ultimately led to the re-routing of the pipeline. Opposition in that state continues. In the case of the Keystone XL pipeline, TransCanada’s projections for the frequency of spills were questioned.vii
Regarding the report’s treatment of Trout Lake, North Bay’s drinking water source, we urge a separate, independent analysis of the risks presented in this particular location. There are a number of tributaries the pipeline comes near and cross that flow quickly into Trout Lake. The proximity to this pristine drinking water source warrants an independent third party assessment that goes beyond what TransCanada has presented in their application.
Pipeline safety? Considering TransCanada’s track record While the DNV-GL assessment of pipeline safety brings forward some critical information for the OEB and Province of Ontario to consider, it fails to make any assessments beyond what TransCanada has proposed in its Energy East project application.
Evaluating the impacts on pipeline safety and the natural environment must extend beyond TransCanada’s application to include a review of TransCanada’s pipeline safety track record.
In looking at this track record the Council of Canadians discovered some serious concerns. In the past 15 months TransCanada has had five major ruptures on its pipelines in Canada. Between 1992 and now, TransCanada has had more ruptures than any other pipeline company, according to statistics available from the NEB.viii
We all know that early detection of a leak is critical to minimizing the impacts of a spill.
In reviewing Transportation and Safety Board reports of ruptures that occurred on TransCanada’s Mainline pipeline systemix, of which one pipeline is proposed for conversion to carry oil for Energy East, we learned that: • One, arguably two, of the nine ruptures on the mainline system between 1994-2011 were first identified by TransCanada’s leak detection system.x • Other ruptures were discovered by TransCanada staff, passers-by and an Ontario Provincial Police officer. • Stress corrosion cracking is the main cause of these ruptures. • The gas was isolated to the ruptured segment of pipe in one case in seven minutes,xi another rupture took 2 hours,xii while another took just over seven hoursxiii to fully isolate due to the failure of a valve to fully close.
At 1.1 million barrels per day, the suggested 22-minute response in the event of an alarm, highlighted in the DNV-GL pipeline safety report, means up to 2.6 million litres of crude could potentially spill. There is also the crude that remains in the pipeline between the safety valves that could additionally drain.
It is unfathomable what a 3.5-hour or seven-hour spill on the massive Energy East pipeline would mean if it happened near or in any of the numerous waterways along its path in this province.
Additionally, the sheer capacity of the pipeline also means TransCanada’s electronic leak detection system won’t catch some potentially significant spills. TransCanada’s leak detection system will only detect leaks that are greater than 1.5% of the pipeline capacity. This means that up to 2.64 million litres of crude oil per day could leak out without a signal from the system.
This pipeline safety history raises some significant disparities between what has happened and what is being promised. This is further supported by pipeline safety concerns being raised by previous TransCanada employees.
A recent Reuters investigation found that the NEB is investigating up to a dozen new allegations of natural gas pipeline safety code violations by TransCanada.xiv This is the second time in recent years that the NEB has probed TransCansada's safety practices following complaints by a whistleblower.
Allegations include faulty or delayed repairs, sloppy welding work and a failure to report key issues to the NEB.
The most recent whistleblower coming forward has instigated a further investigation of NEB engineers reviewing the TransCanada complaint by their professional association.
This context and TransCanada’s pipeline safety history is absolutely pertinent when evaluating whether Energy East meets the highest available technical standards for public safety and environmental protection.
Regarding the DNV-GL Assessment of Pipeline Safety, stress corrosion cracking is identified as the primary integrity-related issue for the Energy East pipeline related to the four tape-coated sections on Line 100-3.xv The disbonding of polyethylene tape on an Enbridge pipeline caused the devastating diluted bitumen spill in Michigan’s Kalamazoo River in 2010.
The DNV-GL provides two further recommendations to minimize the likelihood of failures for these segments.
Here, the DNV-GL report fittingly acknowledges the limitations of in-line inspection tools, the accepted industry approach for detecting and sizing crack-related features that TransCanada has proposed for these segments.
To this, we add the example of the 65-year-old repurposed Exxon Pegagus pipeline that ruptured, causing diluted bitumen to flow down the streets of Mayflower, a suburb in Arkansas. This pipeline was in-line inspected a month prior to event. The inspection failed to pick up the flaw that caused the rupture.xvi
We further add that the risk, particularly in these sections, is simply unacceptable. As highlighted in the DNV-GL report, one of these segments near Ignace already failed a hydrostatic test in 2000. The tape- coated section in the Nipigon area is also of particular concern. In 1990, a large section of the Nipigon River’s bank experienced a significant landslide which left a 75-metre stretch of a TransCanada natural gas pipeline hanging mid-air with no support.xvii If the pipeline had been full of oil, it would have weighed more than 70 tonnes and would certainly have ruptured and spilled into the Nipigon River. This river crossing is mere kilometres from Lake Superior, considered the cleanest of our Great Lakes. Nipigon River is also the source of Nipigon’s drinking water.
Finally, the DNV-GL Assessment of Impacts on Pipeline Safety highlights a reference to the Kalamazoo River, Michigan spill in TransCanada’s application. Here it is noted that TransCanada will have tactical plans and equipment for dealing with sunken or submerged oil, and plans to further engage in procuring equipment and resources and ensuring personnel are appropriately trained. It remains unclear to the Council of Canadians what plans, equipment and training for personnel would be considered sufficient in the event of a diluted bitumen spill in or near an Ontario waterway, groundwater or aquifer where the bitumen sank. We further point out that this appears inconsistent with TransCanada’s public addressing of concerns related to sinking bitumen. Their Energy East webpage lists “Oil from the oil sands is harder to clean up after a spill in a waterway” as a “myth”.xviii
It remains unclear whether Emergency Responders will have prior access to a list of what would potentially be flowing through the pipeline to best evaluate how to respond in the event of a spill. What will be done to immediately convey to frontline responders what crude oil substance has spilled?
Further to the point, the absence of specific details regarding emergency response plans from TransCanada is yet another reason to call for a halt to the ongoing NEB review of the Energy East pipeline. These plans are critical in the event of a pipeline spill. How is the Province of Ontario expected to meaningful engage in the NEB process to ensure Energy East satisfies the principles set out by the Province without such critical information?
Climate implications of Energy East must be recognized
The Council of Canadians urges the OEB to consider the Pembina Institute’s report on the climate implications of the Energy East pipeline.xix If Ontario wants to be a leader on climate change, we must take a stand against the Energy East pipeline. Approval of Energy East would mean Canada would have little chance of meeting our already weak emission reduction target.xx It would wipe out the good done by this province’s phase-out of coal-fired power.
Regarding the report prepared by Navius Research, there are a number of assumptions that led to a conclusion in conflict with that of the Pembina Institute. These include assuming a base price of oil at 2010 levels, when recent months have clearly shown an unpredicted shift has taken place in the trend of world oil prices. How would the conclusions from Navius’ OIL TRANS model look were $50-$60 (current average prices) used?
There are a number of clear reasons to question the suitability of rail to replace the export capacity that Energy East would provide, as assumed in the Navius report. This relates to both the ambitions of expansion in the Alberta tar sands (achieving industry expansion ambitions would require new rail and pipeline transport options) and the short to medium term implications of a low oil price. In this regard, we encourage the OEB to consider the most recent evidence brought forward by the Pembina Institute submission on the final OEB technical reports.
The current scenario of rapidly dropping oil prices underscores another concern with the conclusions drawn from the Navius report. The assumptions in the report look to historical patterns of the global oil market to predict future scenarios. The current strategy adopted by Saudi Arabia was notably unexpected and has had global repercussions. This type of modeling of global oil markets is truly a best guess situation.
Ontario becoming more reliant on fracked gas imports Regarding the technical reports on the implications for natural gas supply and cost, the Council of Canadians believes the Ontario government has a responsibility to ensure Ontarians do not subsidize the costs of the Energy East pipeline through natural gas costs. We believe the risks associated with the pipeline are reason enough to reject the project, let alone adding increases to natural gas costs for homes and businesses.
We further urge the OEB to again consider the implications of becoming increasingly reliant on fracked gas imports from the U.S. as raised in our previous submission.
Provincial leadership required
There is a lack of federal leadership when it comes to addressing climate change, protecting water and ensuring Canadians have access to needed energy. Canada does not have a national strategy to address urgent water issues or an effective climate policy. There is no federal leadership to conserve and protect our water or a plan to ensure Canadians have access to the energy we need, while reducing our fossil fuel dependency. During a time of global water and climate crises, the federal water policy is 27 years old and badly outdated. There is yet to be any federal regulation of emissions for the oil and gas sector.
As we raised previously, many of our federal regulations have been clawed back or gutted in recent years.
Meanwhile the NEB finds itself at the heart of a growing crisis. There are many who believe the NEB no longer has the legitimacy to provide the social licence for projects like Energy East. There are multiple lawsuits underway challenging new federally imposed rules restricting participation in NEB process, and the new unforgiving timeline for project reviews. The failure of the NEB to consider the upstream climate pollution impacts of filling pipelines like Energy East – about which they recently received over 100,000 messagesxxi – is further compounding this crisis.
It is in this context that provincial leadership is needed, leadership that rejects projects like Energy East, which will send Canada further down the path of risking important waterways, fostering further expansion in the tar sands and more climate emissions. We commend the Energy Minister’s commitment to represent Ontario’s interests before the NEB, as well as the consultation being undertaken by the OEB. Ultimately, we feel the scale of imminent threat presented by the Energy East pipeline and the Harper government's abdication of its duties justifies Ontario’s intervention. In order to represent Ontarians’ interests, the Premier should speak publicly against the Energy East pipeline.
iMcCarthy, Shawn. "Ontario First Nations Demand NEB Halt Energy East Review, Seek Consultation." Globe and Mail. 5 Feb. 2015. ii “Council of Canadians Written Submission, Part One of OEB Energy East Consultations.” 15 May 2014.