As Republican state officials insist that Canadian oil pipelines are necessary to lower energy costs for American consumers, the fossil fuel giant operating those pipelines is suddenly citing the climate crisis its products are creating as a rationale for raising those prices higher, according to new documents reviewed by the Daily Poster.
Last month, Ohio Republican governor Mike DeWine — who has raked in nearly $400,000 from fossil fuel industry donors — demanded the Biden administration keep open Enbridge’s controversial Line 5 pipeline, which runs under the Great Lakes, as a way to reduce energy prices.
But Enbridge just dropped a bombshell undercutting that argument: the firm told government regulators that climate change means its tar sands pipeline network only has nineteen years left of economic life. That assertion could allow the company to jack up the tolls that its customers pay to transport oil through its pipelines, because pipeline operators are authorized to recoup their operational costs through rate increases — and a shorter timetable means higher levies.
The episode is a spectacle of what’s been called disaster capitalism: In this case, a fossil fuel behemoth is citing the ecological crisis it is intensifying as a justification to extract more profits from consumers already being crushed by higher prices.
“There is something ironic about pipeline companies like Enbridge conceding that they can see the writing on the wall, they’re not going to be competitive or needed less than twenty years from today, and, as a result, they have to raise prices today to account for that,” said Ari Peskoe, director of the Electricity Law Initiative at the Harvard Law School. “There’s something incongruous about that.”
Enbridge has been doing everything in its power to preserve and expand its massive pipeline network, the largest in North America. The multinational completed construction on its expanded Line 3 pipeline in Minnesota this fall, despite years of heated opposition from Indigenous people, climate activists, and lawmakers. Now the company is working to derail Michigan governor Gretchen Whitmer’s reelection bid, in response to Whitmer’s order aiming to shut down the company’s aging Line 5 pipeline, because a spill could be imminent and the pipeline runs through the Great Lakes.
In that battle, Enbridge has insisted that shutting down Line 5 would cause a spike in fuel prices, because the pipeline supplies ten refineries in the region. And yet, this May, the company told federal energy regulators that its pipelines are likely worth far less because governments are preparing to try to combat the carbon emissions from its products.