Tar is sticky subject

Despite being two of the most profligate energy users on the planet, the United States and Canada have spent little time over the last eight years discussing what they might do together to combat climate change and protect the environment.

That changed Feb. 19, when President Obama made his first post-inauguration trip out of the country to meet Stephen Harper, Canada's prime minister. The environment was one of just three topics on their official agenda.

Obama seems the more committed environmentalist; clean energy and energy reduction figure prominently in his stimulus package. Harper is a more-recent convert to the green cause and it is not yet clear he has been fully won over.

He is torn between his allegiance to his adopted province of Alberta, where Canada's tar sands are located, and the need to align Canada's policies with those of the United States, which buys most of Canada's energy exports. As long as George Bush was in office, Harper didn't have to choose between the two, but a new president with decidedly greener views will force his hand.

The tar sands, which account for about half of Canada's crude oil exports (almost all of which go to the United States, along with much of Canada's natural gas, hydroelectric power and uranium), were under attack by green groups and some U.S. policymakers long before the change of administration.

Steaming the heavy oil out of the ground, or mining and processing the tarry sand, requires large amounts of energy and water, and the deforestation of vast tracts of boreal forest. The federal and Alberta governments have resisted imposing environmental rules that would impede tar-sands development.

This stance is shifting. Just days after the U.S. election, the Canadian prime minister proposed a continental cap-and-trade system to control carbon emissions -- something the oil industry in Canada adamantly opposes.

Even more surprising was the decision in February of the federal and Alberta governments to charge Syncrude, a large tar-sands processor, with offenses under environmental and bird-protection laws for the deaths of 500 ducks in one of the company's tailing ponds last April.

Harper and his advisers are also aware that while Bush blocked states' efforts to regulate greenhouse-gas emissions (California and Vermont, for instance, both wanted to set a carbon standard for transport fuels), Obama may permit such state-by-state laws.

And Canada is still fighting for an exemption from a rule inserted into the 2007 Energy Independence and Security Act that bars the U.S. government from buying fuels if their production causes more greenhouse-gas emissions than conventional petroleum sources, as does producing oil from tar sands.

At their meeting in Ottawa, Harper and Obama agreed to collaborate on the development and use of clean energy -- boilerplate stuff. But they also discussed broader collaboration in the future, including matching their countries' environmental rules.

At first glance, this is bad news for tar-sands producers, already struggling with the slump in oil prices from over $140 a barrel last July to around $40 today. During that time, projects worth an estimated $80 billion have been cancelled or postponed.

There is a bright side. Stimulus money is pouring out of Washington and Ottawa, some of it already earmarked for research and technology to help the oil industry produce cleaner fuels.

Both Obama and Harper made particular mention of carbon capture and sequestration, an unproven and expensive technology that could eventually be used on the coal plants that produce about 70 percent of American electricity, or on the upgraders and refineries in the tar sands.