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Energy East pipeline is dead, fallout in Alberta will be measurable

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The Canaport LNG jetty in Saint John. Image: Environmental Defence Canada/flickr

It's been quite obvious for some time now, to most anyone who was paying attention, that the Energy East Pipeline project was doomed.

Notwithstanding its many regulatory problems, it was the economics of the idea that killed it, as even conservative commentators admit. The project's economic fundamentals never made much sense, and they don't make any now.

Still, the announcement yesterday by TransCanada Corporation that it is pulling the plug on the idea of building a $15.7-billion pipeline spanning 4,500 kilometres from Alberta to New Brunswick will have measurable political fallout here in Alberta.

Premier Rachel Notley's government has staked too much credibility on its ability to get pipelines built where generations of conservatives got nowhere. So Premier Notley no doubt was sincere when she called the company's not-unexpected decision "an unfortunate outcome for Canadians" and said her government is "deeply disappointed."

Needless to say, notwithstanding its leaders' faux tears and faux cries of outrage, the United Conservative Party, soon to be led by Jason Kenney, is absolutely delighted by this development.

From Kenney's perspective, the timing, perhaps, could have been a little more auspicious -- as in, slightly closer to the 2019 provincial election. Otherwise, the announcement yesterday by TransCanada President and CEO Russ Girling pretty well gave the UCP what it asked for.

The UCP leadership may not be particularly nice, but they are no dummies. They understood, just as readers of this blog do, that the project was kaput, and why. This way, though, they can blame Notley's NDP and Prime Minister Justin Trudeau's Liberal government for the project's collapse, and claim the regulatory process was their willing accomplice.

In TransCanada's news release yesterday morning, Girling only vaguely referenced "changed circumstances" as the reason for dropping the project. But in a letter to the National Energy Board, widely quoted by media, he cited "substantial uncertainty around the scope, timing and cost associated with the regulatory review." Whether or not it was intended as such, this was a gift to Alberta's conservatives, who basically oppose regulation of the fossil fuel industry. Period.

Well, you can't really blame the UCPers for striking while the iron is hot, can you? The NDP did load a lot of their political eggs into that particular structurally unsound basket.

Nationally, despite the best efforts of the federal Conservatives to ratchet up the rhetoric about the company's cancellation of the project to a hysterical pitch, the end of Energy East won't likely do much harm to Trudeau's Liberals. Indeed, it may make things quite a bit easier for the prime minister, who won't have to anger Quebecers who might support him to appease voters in Alberta and Saskatchewan who never will.

However, you can expect Alberta's conservative politicians to be unable to resist the temptation to turn yesterday's announcement into an excuse for hyperbolic attacks on Quebec and Quebecers, and for indépendantiste-minded Quebec politicians to fire back in kind, to the joy of the basest elements in each of their bases.

Indeed, there was no need to wait for this kind of foolish nastiness. Before 10 a.m. yesterday, UCP leadership contender Brian Jean, the former leader of the Wildrose Party, was personally attacking Montreal Mayor Denis Coderre in a fundraising email and interpreting TransCanada's decision as "an attack on Alberta." The heading on the hysterical email: "They've declared war on Alberta."

Yeah, yeah…

The only way to end the "war on Alberta," by the sound of the conservative protestations, would be to set up a mechanism to force the rest of Canada to buy Albertan oil. Last time we Canadians tried that, however, it was called the National Energy Program, and it was the brain child of another Liberal prime minister named Trudeau. Pierre Elliot, that is. Brian Mulroney's Tory government dismantled its final remnants to the huzzahs of Alberta's conservatives.

Had the Energy East Pipeline been built, of course, the price fetched by Alberta's bitumen wouldn't have changed very much, if at all.

Image: Environmental Defence Canada/flickr

This post also appears on David Climenhaga's blog AlbertaPolitics.ca.

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