Why and How Obama Will (Probably) Approve Keystone XL

The test the president laid out for the controversial pipeline wasn't a prelude to rejecting it -- just the opposite.

President Obama wipes sweat from his brow during a speech on climate change at Georgetown University last month. (Reuters)

Gazing into my columnist's crystal ball on a steamy summer day when many in the Obama administration have climate change on their minds, I see a decision coming on the Keystone XL pipeline on a cold December day when most people have holiday shopping on their minds.

Based on conversations with administration insiders, here's how I envision the final act of the long-running Keystone drama playing out:

Secretary of State John Kerry, who counts combatting climate change as one of his lifelong passions, will recommend to President Obama that he should not approve the pipeline, which would send 35 million gallons of oil every day over 1,700 miles from Alberta's carbon-heavy oil sands to Gulf Coast refineries. Obama will decide to approve the project, in large part because he will have secured commitments from Canada to do more to reduce its carbon emissions.

Obama will publicly repudiate Kerry, akin to how Obama publicly repudiated Lisa Jackson, his first Environmental Protection Agency administrator, two years ago when she asked the White House to let her move forward on a stronger smog standard. On the Friday before Labor Day 2011, Obama announced that he was delaying the standard because of economic concerns.

At that point in time, Jackson endured as the champion for disenchanted environmentalists.

Sometime this winter -- I predict in December -- Kerry will play that same role when Obama decides to approve the pipeline.

The response from pipeline proponents, especially Republicans in Congress, will be jubilation. More importantly, approval of the project can only help, not hurt, Democrats up for reelection in 2014, including Sens. Mary Landrieu in Louisiana, Mark Pryor in Arkansas, and Mark Begich in Alaska, who all support the pipeline and have more-conservative energy positions than Obama. But because the decision comes nearly a year before Election Day 2014, it will likely be old political news by the time campaigns kick into high gear.

The reaction from the environmental community, especially the grassroots opposition led by the Sierra Club and 350.org, will be loud and fevered. They will probably have lawsuits waiting in the pipeline (pun intended). But many environmentalists realize it's not the only climate game in town now that Obama has committed to clamping down on carbon emissions from coal-fired power plants, which account for nearly 40 percent of U.S. greenhouse gases.

"For us, the primary thing is to get the largest single sources, which is power plants, and control their carbon emissions," Frances Beinecke, president of the Natural Resources Defense Council, told me last week at Georgetown University while waiting to hear Obama give what was his most substantive speech on climate change as president. "That's the center of the plan. Now the next thing is to get it done."

To the surprise of everyone outside the White House, Obama mentioned the pipeline in his speech. It was a politically savvy move for three reasons: 1) He called out the elephant in the room and thus avoided both criticism from groups like the Sierra Club and the subsequent media coverage of his omission; 2) He took ownership of the issue, showing everyone on every side of the fight he is personally involved; and 3) He shifted the debate over the pipeline from one of economics to one about the effects on climate change.

"Our national interest will only be served if this project does not significantly exacerbate the problem of carbon pollution," Obama said forcefully, prompting loud cheers from the audience of several hundred climate-minded people. "The net effects of the pipeline's impact on our climate will be absolutely critical to determining whether this project is allowed to go forward."

Environmentalists cheered Obama's new "test" for the pipeline. They maintain that there isn't a way Obama could approve the project since its impact will surely "significantly exacerbate" climate change. People close to the White House read it differently.

"I think it was a clear signal to the Canadians to come to the table and put a good-faith program out there that could provide the kind of net reductions beyond anyone's doubt that would allow Obama to proceed," said a source close to the Obama administration who would speak on the condition of anonymity only.

The basis for Obama to couple his decision to approve the pipeline with additional significant climate commitments from our northern neighbor will not come from nowhere. When the EPA sent a letter in April to the State Department, the federal agency tasked with reviewing the pipeline, and criticized the department's environmental assessment, Cynthia Giles, EPA's assistant administrator for enforcement, also wrote this:

"EPA recommends that the final EIS [environmental impact statement] complement this discussion with an exploration of specific ways that the U.S. might work with Canada to promote further efforts to reduce GHG emissions associated with the production of oil sands crude, including a joint focus on carbon capture and storage projects and research, as well as ways to improve energy efficiency associated with extraction technologies," Giles writes in the seven-page letter.

While approving the Keystone XL pipeline, Obama will say he is leveraging his power over the project to drive an international effort to combat climate change, which is what the debate about the pipeline is all about.