Decision time: Pipeline will create jobs, lower gas prices

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President Obama lasted just one week into his second term before a familiar decision popped back into the picture. This decision is what to do with the Keystone XL pipeline. This is most definitely not the first time that the President has had this decision come across his desk. In fact, he has postponed the decision twice already due to concerns about the environmental safety in the state of Nebraska.

The pipeline is to cover a distance of 1,700 miles from Alberta, Canada to the Gulf of Mexico. The pipeline itself would be used to transport heavy oil-like bitumen. Although environmental analysis originally concluded that any existing risks regarding this new section of the pipeline were low, the decision about the pipeline was postponed because it was supposed to stretch over the Olgallala Aquifer. This aquifer is an underground water source that happens to be the main source of irrigation for the US farmland supplying a total of eight states. The aquifer itself is undoubtedly important.

Since sixty-five percent of the Olgallala Aquifer is in the state of Nebraska, it seems to be that the state has found itself at the center of the issue. However, Tuesday, January 22, 2013, Nebraska Governor Dave Heineman (R) contacted President Obama and Secretary of State Hillary Rodham Clinton in order to express his satisfaction with the alterations that TransCanada proposed. He believes that all potential environmental risks have been lessened even further by avoiding many areas of risk such as fragile soil, shallow groundwater, and bedrock close to the surface. Additionally, many new safety measures have been added including but not limited to additional data sensors and remote control shut off valves. The alterations to the plan have been approved by the Department of Environmental Quality.

The pipeline will bring many benefits. It is estimated that the construction will generate $418 million in economic benefits for the state, as well as $13 million in property-tax revenues throughout the first operational year. Russ Girling, the president and chief executive officer of TransCanada further emphasizes the benefits that will come with the pipeline. In addition to the thousands of jobs that will be created in the process, he says that the pipeline will provide a great deal of enhanced energy security.

With the support of the state of Nebraska officially behind the pipeline, President Obama finds himself in yet another tough situation at the very beginning of his second term. It would appear that he has a struggle between satisfying the concerns presented by environmental groups while still being able to allow jobs to be created. However, this time it seems as though the support of the Governor of Nebraska could be a major deciding factor.

The main opposition to the pipeline comes from the many environmental groups choosing to draw a line in the sand around this issue. They desire for the President to stop the growth of such energy resources and focus mainly on green technology. What many of these groups fail to focus on is the fact that this energy will make its way into the market somehow, even if the United States were to put a stop to the project. This is a classic case of the supply creating demand.

Those who are pushing strongly for the transition into green energy may have good intentions, but they need to answer to some serious economic questions. They need to come up with a way to answer to the thousands of jobs that will be created by this project. Additionally, they will need an answer to the tax revenue that will be generated by this project. While green technology is not a bad thing, it most likely needs to mature before any country would be ready to make such a switch. As for now, it seems like this decision may take well into the first quarter or beyond to be made, but the signs would mostly suggest a green light for the pipeline.