Fact-checking Jason Kenney: Is B.C.’s pipeline opposition to blame for high gas prices?

by - 4 min read

Fact-checking Jason Kenney: Is B.C.’s pipeline opposition to blame for high gas prices?

by - 4 min read

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Alberta’s new premier came out swinging on the morning of his first full day in office, blaming his counterparts in B.C. for record-high gas prices and promising to cut off their petroleum supply if necessary.

One of Jason Kenney’s first moves as premier was to proclaim Bill 12, better known as the “turn off the taps” bill, and he followed it up with a forceful news conference Wednesday morning.

Kenney took aim at B.C. Premier John Horgan, saying his government’s opposition to the planned expansion of the Trans Mountain pipeline “hurts all Canadians, but British Columbians more than most.” Here’s a reality check on some of Kenney’s claims.

Is B.C.’s opposition to the pipeline to blame for high prices?

Prices at the pump have reached above $1.70 a litre in the Vancouver area in recent weeks, and Alberta’s premier would have you believe that’s a direct result of the B.C. government’s promise to fight Trans Mountain.

“Unfortunately, since coming to office in July of 2017, the B.C. government has opposed the expansion of this pipeline every step of the way — most recently at the British Columbia Court of Appeal — and in so doing they’ve driven up gasoline prices in the Lower Mainland,” Kenney told reporters.

This claim seems to be based on the assumption that twinning the pipeline will lead to cheaper gas in B.C. (more on that in a bit) and that delays in completing the project are contributing to high prices.

But there’s no evidence that the case before the Court of Appeal, which asks if B.C. has the right to regulate the transport of oil within its borders, is responsible for those delays.

Gas prices in B.C.’s Lower Mainland hit record highs in April. (Evan Mitsui/CBC)

Werner Antweiler, an economist at the University of B.C., laughed when he heard Kenney’s claim.

“There’s no causality here. It’s just like, you take two unrelated things, draw a connection in people’s minds, but it’s not actually there. So I have to call him out on that,” he told CBC.

Andrew Leach, an energy economist at the University of Alberta, agreed.

“What’s delayed Trans Mountain, it has very little to do with the actions of the B.C. government to date. It has more to do with the federal government’s not meeting its duty to consult with First Nations and not adequately following up on it its responsibilities under the Species at Risk Act,” Leach said.

Those failures by Ottawa are behind the Federal Court of Appeal’s decision last summer to quash the approval for the expansion project, handing Trans Mountain a major setback.

Will the expanded pipeline mean more, and therefore cheaper, gas for B.C.?

This is a tricky one.

Supply is a major factor in B.C.’s gas prices — the province only has two refineries, and it depends on petroleum from Alberta and refined products from Washington state to make up the difference. When refineries cut back on production because of mechanical issues or scheduled maintenance, B.C.’s supply is pinched, and prices can soar.

Kenney’s argument is that increasing Trans Mountain’s capacity from 300,000 barrels per day to 890,000 would relieve some of that pressure.

“Eight hundred [and ninety] thousand barrels per day will mean that we can increase shipments of refined products to the Lower Mainland. That will reduce gas prices for Vancouverites,” he said Wednesday.

B.C. only has two refineries. (Jason Franson/The Canadian Press)

According to Trans Mountain, however, almost all of the additional capacity from the expansion project is already spoken for, and it’s not going to B.C.

“Thirteen shippers have made long-term commitments for roughly 80 per cent of the capacity on the expanded pipeline. We expect the majority of the expansion capacity will be for export,” the pipeline company said in an email.

That would still, theoretically, leave some extra capacity for refined products to be sent to the Lower Mainland.

Antweiler, for one, is optimistic that B.C.’s supply will go up and gas prices will go down once the expansion is complete.

But some evidence suggests otherwise. A 2015 analysis from oil and gas consultant Muse Stancil, prepared on behalf of Trans Mountain for hearings before the National Energy Board, says that “refined product shipments will not increase as a result of the Trans Mountain expansion project.”

And independent economist Robyn Allan has argued that twinning the pipeline will actually cause gas prices to go up, because toll rates on the existing pipeline will more than double.

Is turning off the taps to B.C. constitutional?

This is the big question — does Alberta have the legal authority to choke B.C.’s petroleum supply?

B.C. Attorney General David Eby has filed a civil claim in Alberta, alleging the new law is unconstitutional, in part because it restricts trade across provincial borders, acts as an export tariff and illegally discriminates against B.C.

Kenney has said his government will respond to those allegations in court.

But Joel Bakan, a constitutional law expert at the University of British Columbia, says the issue is fairly black and white.

“It’s rare in Canadian constitutional law to have an open and shut case, but this is definitely one. The Alberta government is on very, very thin ice in terms of their legal argument,” he told CBC News.

B.C. Attorney General David Eby filed suit against the Alberta government on Wednesday. (Tanya Fletcher/CBC)

Some argue, however, that the legality isn’t what matters.

“This whole issue of whether or not the Kenney government succeeds in having the legislation upheld in the courts is kind of beside the point,” Jared Wesley, a political scientist at the University of Alberta, said.

“They’re picking a fight and they look good whether the courts hold it up or not. They look like they’re standing up for Alberta’s interests whether or not they’re actually able to use the legislation.

This story originally appeared on CBC

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