Pennsylvania families and businesses will spend an additional $512 million to more than $630 million on gasoline and diesel fuel annually over the following five years due to the resulting loss of production at area refineries if Line 5 is shutdown, according to the Consumer Energy Alliance, a longtime member of the Pennsylvania Energy Infrastructure Alliance.
In addition to increased energy costs, Pennsylvania could lose up to $2.1 billion in economic activity, $34.4 million in state tax revenue, and more than 3,800 jobs from the shutdown.
CEA today issued a report, “Enbridge Line 5 | Shutdown Impacts on Transportation Fuel,” that examines the local effects of a situation playing out in the Midwest where Michigan Gov. Gretchen Whitmer is trying to shut down the underwater pipeline, which is owned and operated by Enbridge. The pipeline has been operating safely since 1953.
Simply known as Line 5, the pipeline transports up to 540,000 barrels per day of light crude oil, light synthetic crude, and natural gas liquids (NGLs) to heat homes and businesses, fuel vehicles, and power industry in parts of the upper Midwest and western Pennsylvania. Line 5 product gets delivered to United Refining Co. in Warren, Pa., where it is refined and distributed for sale as gasoline and other fuels across the region.
“At a time when consumer prices are rising at their fastest pace in more than 40 years, and Americans are suffering from the highest gasoline prices in over seven years, choking the region’s fuel supply by closing Line 5 would be economically ruinous,” CEA Midwest Director Chris Ventura said
Based on previous studies of disaster-related fuel production disruptions, the closure of Line 5 will spark a 9.47 percent to 11.66 percent regional increase in fuel prices. This increase is independent of any transportation constraints or other market conditions, such as the surge in fuel prices observed over the past 12 months that are tied to international oil markets and logistical challenges caused by the pandemic.
Across the entire Midwest, families and businesses will spend at least $23.7 billion more on gasoline and diesel over the following five years if the pipeline is shut down.
“Michigan may be hundreds of miles away from Pennsylvania, but any decision to shut down critical pipeline infrastructure there could have a resounding and punishing effect on fuel prices and consumers’ pocketbooks here,” PEIA spokesman Kurt Knaus said. “Shutting down Line 5, especially during these uncertain times, would be disastrous.”