Energy East Concern: Risk Assessment

Last week’s article discussed some of the potential risks that North Grenville residents will face if the Energy East pipeline is built. It is good to be aware of risks, but to make good decisions it is also important to measure risks.

So, if NG Council wants to follow the example of County Council and decide whether the pipeline is in our collective best interests, shouldn’t they do so after they’ve taken stock of all the foreseeable costs and benefits?

In general terms, this is a process that begins by identifying and measuring all the possible risks and their impacts. This is risk assessment, and no big decision should ever be made without one. Banks do them, investors do them, businesses do them, and it is fundamental to what insurance companies do. Risk assessment is even done by everyday people like you and I. We do them often without even thinking about it, even though we may not call it that; like when we chose to put on a helmet before biking. Incidentally, the Darwin Awards are for those who do them spectacularly poorly.

For Council to know whether Energy East is good for us, they should start with a Probabilistic Risk Assessment (PRA). Unfortunately, with all the tasks they have they really don’t have the capacity and also likely lack the capability to do one. And there is nothing to suggest that they want to contract it out. For a pipeline project like Energy East this work should be done at the national level by the NEB where it would be at the core of their process, and probably wouldn’t be released to us until most of their work is done, if it is even released at all.

To be succinct, when done right a PRA is a very detailed, in-depth, exhaustive study. It examines all risks for probability, frequency, size, scope, severity and all associated costs. It puts numbers to the individual risks and adds them up.

And don’t think we need only to look at risks from spills that occur when a valve or pipe bursts, or when a human error is made and a valve is left open or not closed, or when pipeline operators decide to not believe their automated leak detection system and leave a pipeline running. We need to look at other risks. We need to consider things like changing weather patterns, vandalism, or even activists who might try to physically shut down a pipeline, as happened earlier this month in the USA.

And then there is another risk that hasn’t been mentioned yet, but is very real: terrorism. If it is easy to imagine how damaging the impact of an accidental spill could be, imagine the impact of a spill from an intentional event? Has that been factored into the equation? In the calculus of a terrorist, the outcome has potential for immense value.

And if you want a second opinion about the risks Energy East poses, ask an insurer to protect you against impacts from the pipeline project. Tell them you want it to cover all of the people in North Grenville, have zero-deductible, coverage against any and all negative outcomes resulting from the pipeline’s presence, and to reimburse people for all losses, tangible and intangible.

Consider this: insurance rates for houses with oil heating have risen 10 to 25 percent over the last decade, and why? Because remediating the effects of a household oil tank leak can cost well over a million dollars! It is unlikely that you could find insurance to cover you from Energy East, and if you could, the cost of such a policy would be prohibitive. That is a good indicator of the level of risk we are facing. It is very doubtful that any value the pipeline brings to residents of North Grenville will offset the cost of protecting you against pipeline risks. These are costs that we are being told to accept so that a large corporation can make billions of dollars.

Government is about managing society for our collective good. Effective management requires decision-making which – in turn – is made with good information. It does not appear that Council or staff have anywhere near sufficient information to make any decision about a project with so much potential harm for our community. And if they do, they should share it with us. After all, in their own words “…Council and the residents of the Municipality of North Grenville need to understand the environmental impacts of this project, including, but not limited to, our drinking water, air, land and associated risks to the Rideau River system…”.

So, where is that risk assessment? And if there isn’t one, what criteria will Council use to determine its costs and benefits?