ESEA Addresses Climate Policy

ICM continues its interview series with Kris Delair, Executive Director of the Empire State Energy Association (ESEA), which represents both heating and motor fuels retailers in New York.

ESEA provides education, training, legislative and regulatory assistance to its members, and promotes the important role its members play in New York State’s economy to the public at large.

What are you seeing from a public policy standpoint on climate issues in New York State as it relates to home heating specifically?

In 2019, New York State enacted the Climate Leadership and Community Protection Act (CLCPA), which is calling for 70% renewable electricity by 2030 then 100% zero emission electricity by 2040, as well as a 40% reduction statewide of greenhouse gas emissions by 2030, an 85% reduction of greenhouse gas emissions by 2050 and then net zero statewide by 2050.

In the heating sector, we were able to get our biodiesel blending standard, which had been effect downstate for some years, enacted statewide with B5 on July 1st, 2022. However, that was delayed until enforcement began in July 1st of 2023. We will be going to a statewide 10% blend by 2025 and a 20% blend by 2030. We have been pushing for a renewable diesel, in addition to biodiesel, to be enacted into that blending standard. It really should encompass all liquid renewable fuels.

We have been getting pushback, however, from [some] environmentalists who believe that all combustibles are bad for the environment

We have been working very hard to educate our lawmakers and the public about what our fuels can do in reducing carbon. We have been decarbonizing for many years and we can decarbonize faster than anybody at less expense.

We also know that New York is contemplating enacting a cap and invest program and it would be on all fuels, from heating to transportation. They are currently trying to determine what the standards will be. They’re also trying to fit it into that mandate of reaching that 40% reduction by 2030, which is an extremely fast time line. As you know, California took their time to implement a program that rolled out slowly. Prices have increased but it has taken years. They were looking for stability and created a program that would have the least negative economic impact on businesses as possible.

When Washington State rolled its program out, parties did not know what the cost of allowances would be. They didn’t hold their first auction until after the compliance began. They set their cap at a 7% reduction in emissions in the first year, which is very high. Prices for those allowances went from $20 an allowance to $60 within six months’ time and increased the price for all goods and services. They’re in a mess in Washington right now because they were trying to roll out this program too quickly.

A cap and invest program needs time to allow the market to adapt and make investment. And like I said, by setting time frames too quickly, they’re not going to allow that.

That’s still in the discussion stage right now?
Right. What came of last legislative session is that New York Department of Environmental Conservation (DEC) has been charged with implementing a cap and invest and we’ ll see more of that come out in the beginning of 2024. Our job is going to be to try to figure out a way and make suggestions to do it in a responsible way—one that is not going to crush people and crush small business in New York.

Getting back to the fuel standard you have now. Is this for heating and transportation?
It’s for heating fuel only. It’s not on the transportation side yet.

What is the timetable for renewable blends?
B5 is the requirement across the State right now. In 2025 we’ll move to B10 and to B20 in 2030..

Did the B-5 have any negative or positive impact especially upstate—downstate has had that requirement for many years now.
The retailers are not having any issues. Our biggest challenge was some wholesale suppliers who weren’t completely ready when the mandate was supposed totake effect. People were doing upgrades to their terminals, and because of COVID-19 and various other things, there were supply chain issues, etc.

One supplier in the North Country exited the market because they are not doing biodiesel. The day before the standard was to take effect the DEC issued and discretionary enforcement waiver, meaning they were not going to police compliance. This delayed getting the standard functioning for about a year.

Is that waiver still in effect?
No, everyone in the state must be delivering a minimum of B5 today with a jump to B10 by mid-2025.

How do the retailers in NY feel about this?
The ones involved with our associations have known about this and were prepared. We did a Bioheat® tour across the state to bring this story everywhere, from technical, marketing, operations to public policy. We really made a strong effort to get them ready. There has been some grumbling from those not involved but the adoption has been quite easy. We have seen a lot of retailers jump right in, skip B5 altogether and go right to 10%.

One of our members in the central New York region jumped right into a 10 % blend. Many of their customers have outdoor tanks and they had no issues— but they were very smart. They talked to their additive company and they made sure that the fuel was additized properly for cold conditions and so, no issues.

As I said, if people are playing it smart, if they’re listening to the education that’s provided, they are not having issues. I do know however, that we are going to have to continue to be proactive about the continuing education process.

Tell us more about New York’s Climate Leadership and Community Protection Act.
It is calling for a statewide 40% reduction in greenhouse gases by 2030, on all sources.

In this past legislative session, a bill was passed requiring all-electric new construction, meaning, anything below seven stories has to be zero emissions, that is all electric, in 2026. Then it included construction above seven stories in 2028.

So, pretty much every residence and every small business built in the state will have to be electric, zero emissions in 2028?
Yes. There are some exceptions, like mobile homes. There has to be a grid feasibility study to be certain it can handle that. There are carve-outs for restaurants and things like that.

There’s nothing with existing construction. So, if something happens in your boiler or your furnace, and it needs to be replaced, there’s nothing saying right now that you have to switch to all electric. Now, is that something in the future we’re going to be fighting? Yes, it is likely. We’re certainly seeing that in other areas and they did try to include that in the bill. It was taken out because there was a lot of pushback on it.

In 2027, when all under-seven story building new construction needs to be zero carbon, which really means heat pumps, there is no provision that you can’t keep your liquid fuel fire system as long as it meets the fuel standard?
That is correct.

How do you see the future of liquid fuel heating in NY, especially if you can get renewable diesel into your standard?
I believe liquid heating fuels will have a sustainable and viable future through the increased blending of renewables such as biodiesel and renewable diesel. The more liquid renewable fuels we have the better off the industry will be, but I think we have our work cut out for us and it’s because of that misconception that all combustibles are potentially bad.

We need to actively be working to educate our lawmakers, environmentalists and public that we are decarbonizing now we are going to continue to decarbonize. What we’re looking at and what we’re asking for is a well-rounded, diverse energy plan. To have that, you need to include all energy sources. It doesn’t make sense to keep looking at just one energy source, such as electricity.

I think a lot of people agree that it’s more important to decarbonize today instead of waiting 10 or 20 years down the road when infrastructure is built out. We have the product, we have the customers, we have the infrastructure—everything’s in place. If it’s truly about decarbonization, then that’s us all day long. ICM

A Decarbonization Solution for Today

ICM continues its interview series with Scott Fenwick, Technical Director, Clean Fuel Alliance America. This interview was excerpted from an episode of NORA’s “In The Loop” podcast series. To hear other episodes, go to IntheLoopwithNORA.org

Scott, as Technical Director of Clean Fuels Alliance (formerly National Biodiesel Board), the trade association for producers and distributors of renewable low-carbon liquid fuels like biodiesel and renewable diesel, how do you see the aggressive push to decarbonize all sectors of industry, including home heating?

A lot of people think it may be a fad, a trend. This isn’t one of those. This is not going away. If you take a step back and look at a more historical perspective, public policy changes with each administration or from State to State. Under the Obama administration, we talked about sustainability and Green jobs, and with biodiesel we had that arrow in our quiver. Following that, it was about domestic energy security and domestic jobs, other areas where low-carbon liquid fuels shone. Now it’s about climate change, greenhouse gas reductions, and decarbonization. We’re at the leading edge of that as well. We are seeing the efforts to decarbonize are now being led by some of the largest corporations in the world in what they call their Environmental, Social and Governance programs (ESG). Companies like Amazon, Nike and Walmart are forcing their shipping companies to reduce their carbon footprint.


There are some very strong directives, laws and policies that point to electrification as the only way to decarbonize. How do renewable liquid fuels fit into this discussion?

There is no silver bullet solution, a one-size-fits-all. We have a great solution available today. Electrification will certainly play a part and it can be another great solution in certain applications for certain people. However, in the heavy-duty segments, or the rail and marine segments that are harder areas to decarbonize, they don’t have to change their fueling infrastructure to use low-carbon liquid fuels and there aren’t any huge conversion technologies that are needed. The same with the heating sector; it’s what Microsoft would have referred to as plug and play.


Let’s talk a little bit about the myths around heating with low-carbon liquid fuels—at this point, primarily biodiesel, and its branded name when blended with heating oil, Bioheat® fuel. What are some of those myths out there and how would you answer them?

All you can really do is address them one point at a time. There are still service technicians that have been in this industry for decades, they’ve seen a transition from high sulfur to ultra-low sulfur fuels and, now adding renewable fuels into the mix. Combustion technologies are quickly catching up, but it’s a slower process than we would like to help educate those folks. What I would express to them is all fuels have issues. Renewable fuels aren’t any different. There are things that are challenges but can be overcome. I do believe that the benefits outweigh those challenges.

One of the first challenges that we’ve encountered is cold flow. Biodiesel does tend to gel at a higher temperature than petroleum fuels do, but it’s manageable in the same way that you would manage a really cold day with ultra-low sulfur heating oil.

There are fuel additives that treat the petroleum fraction, so if it’s a B5 or B20, those traditional additives can still work—there are heated fuel systems as well and there is blending with kero on really cold days. Those are known solutions that the industry has dealt with for decades. A new fuel additive was introduced this year formulated specifically for companies moving up to higher blends of biodiesel and, as a result, decarbonization.

Long-term stability is another one that we hear about. The myth is that biofuels like biodiesel can’t be stored as long as petroleum fuels. Our research shows that they can. The adjustment that the industry does need to make is that you can no longer just buy fuel, drop it in your tank and forget it. Those days should have disappeared a couple of decades ago. Even when we changed from high sulfur to ultra-low sulfur fuels, there were changes and precautions—best practices—that now need to be implemented in maintaining fuel quality. First and foremost is keeping the fuel clean and dry. This is not specific to biodiesel blends, low or high. This applies to all fuels.


Those issues, which as you say are all manageable, also come with benefits beyond decarbonization, is that right?

Yes, one is the clean combustion of biodiesel. If you’re running B100, it is an ultra-clean fuel, partly because it is an oxygenated fuel, and that oxygen in that fuel helps during combustion. It lowers the emissions, which means less PM (particulate matter) and less soot that builds up in the system and less that is released into the atmosphere. At B50, you’re still getting half of those benefits. At B20, it would be a fifth less.


Clean Fuels has been at this for decades, so this is not a novel fuel. What initiatives can we expect from Clean Fuels in the near future?

Well, I think it’s not just Clean Fuels out in front. We’ve got a whole industry initiative behind us. Collaboratively, we are working with some of the leading distributors in the Northeast and Mid-Atlantic States on their marketing and educational efforts. We are working with the equipment manufacturers to get their latest version of equipment approved for B100 and we will help with their marketing efforts through social media, press releases, etc. What is important to remember is that clean burning combustion and decarbonization is not just for the industry, but for the consumer as well.


There are many retail fuel marketers who have not started their transitions to renewable, low-carbon fuels, or perhaps those that have stalled at low levels. What would you say to them?

I don’t want you to just take my word for it. I want you to talk to others. Talk with your peers throughout the industry that are using it and see what they tell you. We’re more than happy to share any industry data, the good, the bad and the ugly, because like I said, there isn’t a perfect fuel, but we will share the solutions to help overcome the issues. I think as more people begin communicating throughout the industry, they’re going to see that, just like we’ve been saying for a couple of decades, the benefits outweigh those challenges. With today’s legislative regulatory pushes along with social pushes to decarbonize as quickly as possible, this is going to be their low-cost and relatively easy option.

When you’re talking about businesses that have been in the family for three or four generations, they’ve seen transitions from coal to high-sulfur fuel, now to ultra-low sulfur fuels and renewable fuels, and we’re increasing those blends. The industry will continue to evolve and change. Cleaner combustion technologies, cleaner fuel, better equipment. We are saying, keep looking at what’s available, keep looking at your options so that you’re ahead of that curve. They’ve seen good results from their storage, their delivery, the technicians working with the product, and then ultimately, satisfaction from the customer with relatively low pushback. This helps the industry stay viable in the long term.


What is the future going to look like for the heating fuel sector?

Clean Fuels Alliance America has been around now for three decades doing research and studies. It’s taken us a long time just to introduce it and get to B2 to B5 to B20. We are now hearing people say that B20 is not enough for their decarbonization efforts. Now with B100 equipment approvals, we are going to start seeing more and more B100, a truly 100% low-carbon fuel, out there in the marketplace.

I think the industry, as it moves toward B100, is going to face increasing competition for renewable fuels from other areas, including railroads, marine and aviation, who are facing their own decarbonization challenges. We are providing a solution that’s available to the heating sector right now and the quicker heating fuel marketers can get on board, the quicker they’ll have an inside track. However, it takes a commitment from the marketers and the low-carbon fuel suppliers working in concert to ensure the availability of the product.


The traditional oil heat customer might look very different in one, two, or three years. Yes, it’s happening that fast. Where can marketers go to get more information?

CleanFuels.org, is our association’s website. It has a lot of valuable information about cold weather operability, stability and other technical issues. Of course, NORA (NORAweb.org) and MyBioheat.com are other great resources as well. ICM

 

Wanting to Make an Impact

ICM continues its interview series chatting with Dr. Jenny Frank, NORA Research Associate and Assistant Professor at SUNY, Morrisville, NY. Frank’s academic and research activities have been investigating the effectiveness and cost viability of various pathways to carbon reduction.

Dr. Frank: I received my Ph.D. from the State University of New York, College of Environmental Science & Forestry. I studied different types of renewable energy technologies and pathways. I focused on different biomass-based pathways, such as bio-heat, biodiesel, solar photovoltaics, and wind-based pathways, to really understanding the technical and financial viability of deploying different types of resources.


ICM: What drew you to this field in the first place, and then to pursue a Ph.D.?

Dr. Frank: I always really wanted to help the environment. As just one person, I thought, “How can I have the biggest impact?” I am someone who, when I start something, I’m going to finish it. I really wanted to help others, as well. Therefore, my interest in the environment, in different types of energy, paired with a desire to help students, is what got me interested in becoming a professor of renewable energy.


ICM: Can you tell me more about your particular area of study—the economic and technical viability of these new technologies?

Dr. Frank: Much of my research focuses on a methodology called techno-economic analysis. Simply put, my research focuses on the technical and financial impacts of diverse renewable energy technologies and fuels. This is done to analyze their long-term impacts from an environmental and financial perspective.


ICM: Is this real-world viability or just the academic exercise of studying?

Dr. Frank: The studies that I do aren’t just theoretical. We’re looking at real-world data and projections, as well as historical data from past energy consumption.


ICM: How did you narrow your focus down to heating from the broad-based studies of environmental science and forestry?

Dr. Frank: Among the different types of studies I worked on, one was a heating analysis. We looked at several different pathways to understand the greenhouse gas emissions from each and whether they are affordable to deploy. We looked at air source heat pumps, natural gas, bioheat (a biomass blend), and then a baseline pathway looking at ULSD, your typical heating oil. That sparked my interest because I didn’t realize until I performed that study how beneficial using a bioheat blend could be, not only from a financial perspective but also from a greenhouse gas emissions perspective when we’re discussing emissions reductions.


ICM: Who commissioned that study?

Dr. Frank: It was part of my Ph.D. dissertation, in collaboration with my advising professor and industry experts, who also authored this study. I had been thinking, “Okay, what would be the advantages of using a fuel such as biodiesel?”


ICM: What did you find in that study?

Dr. Frank: We found that, when compared to alternative pathways, such as ULSD, as well as natural gas, the biomass-based fuel (biodiesel) has the advantage in terms of greenhouse gas emissions reductions and also from a financial viability standpoint. This was a New York-based study; of course, depending on where you do the study, the results may differ depending on the data you utilize, such as fuel type and other inputs.

From a greenhouse gas standpoint, in terms of greatest reductions from the ULSD baseline, we found that the air source heat pump had the greatest reductions, and that was followed by the biodiesel blend. However, when it comes to financial viability, we found that the biodiesel blend was favorable.

This study is currently published in a peer-reviewed journal. If anyone has any questions, please feel free to contact me at jfrank@noraweb.org


ICM: You did some work with the National Biodiesel Board, now Clean Fuels Alliance America. I understand that they have a program to support young scientists in the low carbon fuels field.

Dr. Frank: That is a wonderful program called Next Generation Scientists for Biodiesel that really helps educate young scientists/students, whether undergrad or graduate, who are interested in learning about biomass-based fuels. The program introduced me to an entire network of different professionals in the field, helped me get to conferences, supported me through participation in different research seminars and research talks in areas that I would never have thought of as a graduate.


ICM: Is this an interactive program with continuing education?

Dr. Frank: Yes. I was the co-chair for some time, and I helped other students in the program, as well. It was a wonderful experience. I hope that, in the future, we can establish a similar program, because it really helped spark my interest in the field. It also helped me in terms of my career prospects.


ICM: You’re now a research associate with NORA, as well as an assistant professor at SUNY, Morrisville. How did you get on NORA’s radar or how did NORA get on yours?

Dr. Frank: NORA had read some of my research.


ICM: You have been working with NORA since the Spring of this year. Were you surprised at anything you saw there?

Dr. Frank: I didn’t realize, at first, that NORA had the Net Zero Carbon Home initiative. When I learned more, I thought what it was doing was amazing. Now, it is one of the projects I am working on, and we have written a study that we hope to get published this year. It proves that that when we utilize solar photovoltaics in combination with B100 (ASTM 6751 biodiesel) fuels, we can achieve a net zero carbon home. It’s great that we can practice what we preach.


ICM: Sounds like that was a pleasant surprise. From your perspective, what challenges are you seeing that the industry is going to have to address?

Dr. Frank: I think that there is this mentality that we can’t move towards both electrification and biomass-based fuels. It must be one or the other. It’s a fact that both electrification and biomass-based fuels both can help us decarbonize, whether it’s at the Federal level, the State level or more of a local level. I think the challenge is this mentality, this mindset, that it’s either/or, not both as it really should be. We should all be working towards a common solution, which is reducing our greenhouse gas emissions through decarbonization.


ICM: Do you see the movement to low-carbon biomass-based fuels happening?

Dr. Frank: I’m seeing the education happen. I think a lot more needs to happen in terms of actually getting people to adopt low-carbon fuels, but I think it is happening.


ICM: Look down the road, five or 10 years, do you personally have a vision for renewable liquid fuels in homes? I know you are “twentysomething” and I don’t like classifying people by generation, but there can be differences in attitudes, perceptions and vision. What’s your vision?

Dr. Frank: If we can educate more homeowners on the benefits of utilizing Bioheat®—that it reduces carbon emissions and our carbon footprint—and have them understand that this is an affordable solution that is available now and clearly works from a technical perspective, I think that we can really expand and get homeowners, especially in my generation, to adopt this fuel. However, education is really important.


ICM: The liquid heating fuels industry’s position is that by using low carbon fuels, greenhouse gas reductions can begin immediately. Has your research looked at that?

Dr. Frank: The time value of carbon was very important throughout my dissertation in terms of reducing our emissions now versus waiting for different technologies to be more affordable and commercial. Biofuels are commercially available now, we can access them, they’re affordable—why wouldn’t we currently want to reduce our emissions? Actually, a few of my studies looked at that—understanding what the monetary value of reducing our emissions is now, as well as considering what the reductions in greenhouse gas emissions are when we reduce now versus waiting five years.


ICM: Do five or ten years really make a difference in greenhouse gas emissions?

Dr. Frank: Yes, at least in the literature that I’ve reviewed and in the studies that I’ve conducted. Yes, it does make a huge difference. I think we need to realize that and act on the notion that we can reduce our emissions today. Why wouldn’t we if we are capable?


ICM: Back to your twentysomething status, your friends are probably of similar age and similar sensibilities, and they might be very conscious about environmental issues. What do you tell them about your working in the heating oil industry? What’s that story for your generation?

Dr. Frank: Most of my peers and colleagues make decisions based on their values; many in my generation act in a way that’s environmentally conscious and sustainable. We really do think about future generations. I tell them that a lot of the work that I’ve done—my Ph.D., dissertation and master’s degree—all focuses on reducing emissions and fostering sustainability. If you don’t believe the industries themselves, at least believe the science. Believe the facts in the peer-reviewed literature as well as my studies, and other studies that I’ve read, that support the fact that biofuels can reduce greenhouse gas emissions. There are alternatives, and this is one alternative that we can implement today. That’s what I tell a lot of my friends when they ask me about what I’ve done and what I’m doing.

I also talk to them about what I teach in my college classes. I teach the facts about different energy technologies and different fuels, and I have a whole unit of biomass-based fuels and technologies. I show them graphs and charts about emissions. It’s not just me working for a company that wants to promote its product; that’s not what I’m doing. I’m teaching students about the facts of energy technologies and energy policies; that’s what I’m trying to do at NORA as well, educate people about different types of fuels and different alternatives that are more sustainable than conventional fuels.

The more I inform students of this, the more they understand, “Oh, this can be part of the solution to our energy crisis.” Maybe when they’re buying a home or when their parents, grandparents or friends are looking at different alternatives, they will think about the information, the facts that I have seen through my research. If people understand the facts, and what is happening, whether it’s in the industry or in the literature, they can then make decisions based on the information and the data, and not just on what they’ve heard or on the opinions of others. ICM

 

ICM: Michael, you have been in the industry for a very long time in varying roles—a member of a family-owned liquid heating fuel retailer, a consultant for retailers venturing into renewable fuels and an executive for a biofuel producer. What attracted you to the NORA position?

Devine: When I found out that John Huber, one of NORA’s founders and its only President to date, was retiring, my initial reaction was, “Wow, that’s a big loss.” Of course, when my name came up as a candidate, I was very flattered, but I was in the midst of building something commercially with World Energy.

When I saw that the liquid heating industry was moving to decarbonize, that this was going to be the vision, it attracted me. I asked my wife what she thought, and her response was, “They need you.” I didn’t expect that and it moved me a little bit. I put my name into the hat and went through the phenomenal process that the executive committee came up with, which went on for several months. Each time we went through another phase, my interest in the job grew. I felt very fortunate to be offered the job.

ICM: You joined NORA as its President a little over a year ago. What did you find once you got there?

Devine: First, understanding the totality of what NORA does was very impressive. I knew there were some educational aspects, I knew they ran some programs, but going through the interview process showed me all the different things that NORA touches in a significant way—technical education, research and development projects, the energy efficiency program and work with equipment manufacturers. The kind of impact that NORA can have and does have is eye-opening.

ICM: Now that you have had a year, can you offer your 30,000-foot view of NORA’s’ position in the industry?

Devine: We are fortunate not to be involved in legislative activity, which is prohibited by NORA’s Federal statute. This allows us to focus on the industry as a whole from an equipment standpoint, from a fuel standpoint, from an educational standpoint and not have any type of political eye as we approach these programs. With our strong employees, as well as our strong contractor contributors, we need to be “Thought Leaders” for the Industry. We need to always look ahead to where the Industry is likely to go.

ICM: I know it’s been a very busy year. What comes to mind as some of the bigger things that NORA has done in the past year?

Devine: You’re right, we have been busy. There were many initiatives coming in before I came to NORA, including the testing of higher biofuel blends. We completed much of the B50 testing and have now moved to B100 testing. This year, we are also testing renewable diesel and renewable diesel blends. As we need to accelerate our transition into higher blends of low carbon fuels, NORA is doing the work to identify the challenges.

However, things then get thrown at us that we weren’t planning on. For instance, I got a call from Chris Herb, Connecticut Energy Marketers Association, last Summer asking if NORA was aware of what was going on regarding building codes and the International Code Council (ICC). We weren’t. However, we got involved with the rulemaking process with Bob O’Brien taking the wheel.

I believe that our involvement has very much helped maintain liquid heating’s place in the codes and I think the code enforcement community is recognizing the voluntary decarbonization strategies our industry is following. Fortunately, because of our size and the nimbleness and quality of our staff, we do have the ability to move quickly.

As I was coming in, our technical manual was in the process of some terrific updates with revised content, enhanced user-friendliness for the technician and the addition of an audio accompaniment. We also introduced the online Technical Resource Center, compiling much of the material from our education series, including YouTube videos, documents and bulletins, some generated by NORA and some from other vetted third parties, including equipment manufacturers. If a service tech finds themselves at 10:00 p.m. in a basement with questions, he or she can reference the Technical Resource Center and we hope they will find what they need.

To focus on the importance of education, we are hosting a Train the Trainer series workshop in June 2023. We’re bringing in a professional educator, with expertise in teaching methodology and practices, to come in and work with some of our technical trainers to help them improve as teachers. It’s a very extensive three-day event and I’m looking forward to sitting in, myself.

At its conclusion, the graduates will be “NORA Accredited Trainers,” which is a new designation to show that they have both technical expertise and teacher training. We hope NORA can deploy these folks to areas that do not have access to our curricula.

We began discussions on the Net Zero Carbon Home just about a year ago. Now, we have a working model with a home on Long Island, NY, using 100% biodiesel partnered with solar panels. It is showing a net zero carbon output. We’re now having meetings in various States to develop additional model homes. That’s something that we’re very proud of.

In 2022, the Inflation Reduction Act was passed and with that a $600 consumer tax credit for the installation of a liquid fuel-fired heating system rated to use biofuel blends. It was the National Energy & Fuels Institute’s (NEFI) lobbying efforts, with important input from the Oilheat Manufacturers Association (OMA), that marshaled that through. NORA quickly did all it could to inform the industry of this opportunity with press releases and in-person events. NORA also saw the opportunity to add the Building Performance Institute’s (BPI) certification for home energy audits as part of our education curriculum.

Bob O’Brien is currently taking the tests, and he’ll be qualified to teach the BPI so that our team, our folks, our technicians will be able to get into homes and conduct home energy audits. These audits could provide homeowners with considerable tax credits, worth thousands of dollars, for equipment upgrades, as well as upgrades to the building envelope. The liquid fuel marketers and service companies will have the opportunity to become home energy consultants.

We want to be able to communicate all the technical and educational work that we’re doing in a user-friendly way and, with that, NORA has created a podcast series called In the Loop with NORA. It began with Brian Clark, Kentucky Petroleum Marketers Association, relaying to me how they use podcasts to communicate to their members and the community at large. We agreed to have Brian and his team produce our series.

We have two episodes completed and they can be found on NORA’s website, the podcast website and through numerous podcast services, such as Spotify, iHeart, Apple Podcasts and Google. Brian is doing a brilliant job with discussing these subject matters with the podcast guests in a conversational way so that it’s easier to digest and understand, and hopefully we can provide more value in communicating the programs to the industry.

We’ve heard the call from some of our constituency that particulate matter from heating appliances is something that some folks are very concerned about. In response, NORA’s Technical Director, Dr. Thomas Butcher, and his team at our Liquid Fuels Research Center in Plainview, NY, have employed portable, internet-connected sensors, known as Purple Air Technology. This allows us to measure particulate matter inside the home. We’re setting up tests near heating appliances, by the fireplace or wood stove (if there is one) and in the kitchen.

What preliminary findings show is the highest levels of particulate matter are coming from cooking. We can collect this data so that decisions are made based on facts and not on assumptions.

Another highlight from the past year was our OEM conference. With assistance from OMA, we brought liquid fuel-fired heating equipment manufacturers together to talk about how the industry can move to the highest blends of biofuels. It seemed we had a consensus and moved the needle forward towards decarbonization.

This dovetails with our partnering with Clean Fuels America on a higher blends infrastructure workshops. We want to look at the challenges and the opportunities in higher blends. We want to look at it from production of renewable fuels all the way through the logistical supply chain, whether it be pipeline or vessel or rail, through the transportation logistics, storing it and getting it to the consumer’s tank. We want to see where there are weaknesses in our supply chain so that we can collaborate and address them.

ICM: I see that NORA has added a new member to its R&D team.

Devine: One of our esteemed consultants, Richard Sweetzer, is retiring this year. How do you fill a void left by somebody like Richard? You don’t, is the short answer. Part of my responsibility is identifying new talent in and around our industry. Dr. Jenny Frank came on our radar screen when she was named a Next Generation Scientist for Biodiesel by the National Biodiesel Board (now Clean Fuels Alliance). Since then, she has earned a Ph.D. from the State University of New York College of Environmental Science & Forestry. Her expertise is in analyzing technical and economic pathways for renewable energy.

Dr. Frank is currently a professor at SUNY Morrisville and we are very pleased that she has joined the NORA team as a Research Associate. Dr. Frank and Dr. Butcher are going to put their heads together to see where we can continue to expand our activities at NORA, bring others in and look at other research partners so that we can scale up our projects. Identifying young talent is essential to us moving forward.

ICM: What challenges do you see for the industry over the next five or 10 years and how do you see NORA addressing them?

Devine: Clearly, we recognize the movement afoot to decarbonize all things. The programs that we’re conducting right now, with higher blends of low carbon fuels, are a big piece of this. I think we also have a role to play in the environmental science of our industry and that is why we chose to bring in Dr. Frank.

We’re collaborating right now with Eco Engineers on the Greenhouse Gases (GHG) multivariable calculator that Richard Sweetzer created for us. We can look at the environmental data so that we can provide the States and other stakeholders with solid, unimpeachable science that they can use to convey the message that our industry is not part of the problem, but part of the solution.

One of the real values that renewable liquid heating has is our ability to decarbonize. If it’s not the most cost-effective way, it’s certainly one of the most cost-effective ways to do that. From NORA’s perspective, this has become our overriding thesis.

ICM: NORA has as strong history of collaboration with other stakeholders in the industry. This now seems to be more important than ever.

Devine: I think NORA’s responsibility for leadership in the industry is to build collaborations. NORA has long-standing relationships with the NORA Alliance retailers, the various State Associations and, of course, our friends at Clean Fuels America.

It is imperative to work within the commercial markets as well. From speaking with the wholesale community, we found ourselves getting involved when there were concerns around fuel supply shortages last fall. I had the opportunity speak to leadership at some of the major wholesale suppliers to try to understand what those challenges were. Having active collaboration with the renewable fuels community, both in the biodiesel and the renewable diesel production side of it, is helpful for us to receive product to test and to also collaborate with them on what our industry is trying to do.

Collaboration with OMA and the liquid fuel equipment manufacturers is also critical. Dr. Butcher and I have spent personal time with both Carlin Combustion and R.W. Beckett Corp. addressing the industry’s needs, as well as the opportunities presented by decarbonization.

Dr. Butcher and I just returned from Europe where we attended the International Trade Fair for Sanitation, Heating & Air (ISH) Expo and visited many manufacturers, as well as NORA’s European counterpart, Eurofuel, to share like experiences and the challenges faced on both sides of the Atlantic. Many are the same and, in some cases, Europe is ahead of us and in other cases, the U.S. is ahead of them.

If NORA is going to continue to be successful, I think it’s largely going to be due to our ability to collaborate with all these stakeholders, listen intently to what’s going on, and then build strategic programs around what can be the most effective for the liquid heating industry. ICM

 

 

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ICM continues its interview series chatting with Jackie Hart, VP Operations, Hart Home Comfort in Oakdale, NY. Hart has been one of the earliest adopters of low-carbon renewable fuels and to this day, is one of the most progressive marketers of high blends of biofuels.

JH: Back in 2007, my father, Ray Hart, who founded the company, felt that we, as an industry, weren’t doing enough environmentally for future generations, including his young grandchildren. We knew that sooner or later; customers would become interested in “Going Green.” To him, having a product that was sustainable, not only for us, but also for U.S. jobs, was and still is extremely important to him and our entire family. He therefore made the decision that we were going to create an infrastructure to provide an environmentally responsible and sustainable fuel to our customers.

ICM: It seemed like a choice of conscience, that this was the right thing to do.

JH: At the time [2007], biodiesel was not anywhere close to heating oil on the MERC—it was more expensive. To use biodiesel would have absolutely no financial benefit to us whatsoever. Also at the time, our initial investment in the injection blending system at the terminal was $250,000, but my father felt like this was the way it was going, that it was the right thing to do and that somebody needed to take responsibility.

ICM: In 2007, the discussion around biodiesel and bioheat was that it is a renewable, sustainable, U.S.-made fuel from U.S. farms. This was before the hard push to reduce greenhouse gases in our industry, which is the driving force behind the current transition to low carbon liquid fuels.

JH: We now believe it’s the way that the industry is going to go and it is for our own survival. At the time, we started with just a B5 blend; we currently deliver B100 to ten homes to evaluate it. It has taken a very long time for some of our business associates and people that are in the industry to jump on board with this. However, right now, we’re faced with New York City banning new fossil fuels in new construction and some NY counties (Nassau, Suffolk) and towns out east, including the Hamptons, banning any fossil fuels in new construction. The companies in our industry are forced to really look at what’s really happening here and what’s going to happen if they don’t make a move.

ICM: In 2007, your dad says, “I’ve got to do the right thing here for the environment, for my family, for my community.” He invested a fair amount of money to get off the ground with the injection. In those first few years, were there any specific obstacles that the company hit?

JH: Our biggest obstacle was trying to figure out how we were going to get product. Fortunately, we were able to reopen a rail spur on our property and we have rail cars that come in with biofuel. For the first couple of seasons, we had issues such as what other types of feedstocks can be used or what types of additives are out there so that if it’s freezing outside, the fuel doesn’t gel up and become unusable. There were those in the industry who thought that this was never going to work and we were never going to be able to use this product. It was just going to contaminate everybody’s system and rot everybody’s tank. We dealt with customers who felt that way, as well as some suppliers. We also had those who felt that the unusable part of the soybean that we utilized was taking food away from hungry families.

ICM: You do your own blending, which means you have your own bulk plants and you are handlingB100. How are you managing that in the cold weather?

JH: We wrap and heat all our terminals’ piping and we treat all of our product—both at the plant and with the individual bottles that go into the oil trucks. We change feedstocks to those more manageable in cold weather.

Most of our customers are on B20 to B50. Customers in Queens or Nassau County (NY) are getting above B20 up to B50 directly from our terminal. We try to keep Suffolk County at B20. This equates to approximately 5,000 customers in the B20-B50 range and another 5,000 with B20 and you have a handful of B100, which is part of a field test. We don’t really have any issues with freeze-ups.

ICM: Can I assume that you deliver to very few above-ground, unprotected tanks?

JH: We do have many Long Island homes that have outside, above-ground tanks and we make sure that this oil is treated. Drivers can put the chemicals in the tanks and treat it at the truck level.

ICM: What about the delivery fleet with B50? Does it ever have a cold flow issue while they’re sitting outside?

JH: Mainly for shrinkage reasons, we don’t load trucks the day before. If it’s going to be to be below freezing, we load up in the morning.

ICM: Have you seen any unusual service issues or a decrease in service issues since you went to B 20 and even up to B50?

JH: We have heard from our technicians that the nozzles are cleaner than they had previously been due to the lower carbon products and the addition of larger blends of biofuel. We recommend now that customers have a cleaning every 12–18 months; even at that point, technicians say that the parts are coming off clean. We have seen a reduction in the number of service calls, which was contrary to what a lot of our technicians thought in the beginning.

When we started this in 2007 at B5, my father would call the service department every day, asking, “Is anything happening…what’s happening?” There were no reports of service issues, so within a month he said, “Ok, let’s just go right to a B 20,”and still nothing happened regarding unusual service calls. Within two months, we had changed from a B5 right to B20. We’ve been providing a B20 since 2007.

ICM: How about the higher blends up to B50?

JH: We started delivering B50 in the summer of 2021.

ICM: You mentioned that some of the service techs were reluctant in the beginning. How about your employees across the board? Was it hard to get employee buy-in? Did you have to train or reach out to technicians and customer service representatives to pull this off?

JH: The office staff went along with what we were doing. We realized that they really needed good, solid information for customers who were calling. We therefore came up with a list of questions and how customer service representatives should address them. We sign everybody up for informational webinars because there’s always something to learn, always refreshers and reminders and always a customer who’s going to ask a question you hadn’t thought of. Our core group of ladies and gentlemen here has been through all of that, and they are really the experts. I can hear them from my office and I think, “OK, this is pretty good stuff.”

ICM: Let’s get to where it really counts—your customers had a lot of questions in the beginning and you trained your customer service people to answer those appropriately. What is the customer reaction then?

JH: We’ve done a lot of e-blasts, as well as mailings when that was the appropriate step to take. We’ve done leave-behinds and we’ve provided education through the field via technicians or drivers who answer questions. For the most part, customers don’t care as much as you may have thought about the benefits of biofuels because they’re very sensitive to an extra 5¢ a gallon, even with a 20¢-per-gallon New York State tax rebate. However, the people who are interested in Green products—they want to know when they can get on our B100 list.

We still have a very few customers who say, “Don’t give it to me, I don’t want it, I’m not taking it.” It requires constant education to say, “Listen, even if your previous company didn’t tell you that they were delivering biofuels, they are, we all are. New York has a law that states this is a mandate, and this is where we’re going.” We provide them with educational materials so they can begin to appreciate what we are doing.

ICM: Do you use your bioheat story as a hook for new customers? Does it attract them?

JH: Yes, we really have tried to attract new customers with it. We do use our story, which is all over our website, YouTube page, etc., and it works. We do a lot of marketing on Facebook and social media and Google AdWords.

The problem is that customers don’t get one consistent message from the oilheat industry. If they hear a message from us, they don’t realize that this is a big force that’s going to move them forward with a more sustainable product.

ICM: If the industry had a consistent message, what would it be?

JH: That Bioheat is here, it’s sustainable and it doesn’t require any system modifications. It’s not going to cost you thousands of dollars to change to a different heat source. It gives you the choice of fuel provider and an energy source. Bioheat is what we have already, and we’ve already been working on it. It’s already something that people are using and delivering and have been developing.

ICM: Where do you see Hart Home Comfort going with this? What is your long-term goal?

JH: We want to be completely B100 in the next 10–15 years, which is not really a long time for us because we’re innovative and we spend money on technology all the way down to our drivers and customer service representatives. We are committed, as individuals and as a family, to increasing bioblend and providing a more sustainable product and industry. We want people to recognize that we are doing something for the environment.

I really feel that it’s vital for our survival, as well as that of other businesses, to really take this seriously. If we don’t all start to get together and move forward, policymakers will put us out of business. We’re passionate about this industry and that’s why the majority of my family has been in it for 40 years. ICM

ICM continues its interview series chatting with a member of the “Next Generation” in the industry. This time we met with Lianna Faber who shares with us her somewhat unusual journey to become a NORA Certified Technician and is now working in the field providing homeowners with technical service.

Faber: I always knew I wanted to do something different. I have older siblings, one of them is a teacher and one is becoming a human resources manager. They chose to go to college; I always knew I wanted to make my own footprints, take my own path. It’s funny how it happened—I was looking into different trades but I wasn’t sure what I wanted to do. I found a card for the Electrical Training Center (ETC), which is a tech school here on Long Island [NY]. It planted a seed in my head. I went to the school, checked it out and signed up for the electrical program. We had a class called the All Trades for both electrical and HVAC students. One of the teachers said, There is electrical in HVAC, but there’s no HVAC in electrical and that’s what directed me to HVAC. At the time, I knew nothing, nothing at all about trades. I thought, Let’s try this, let’s see where it takes me. I switched to the HVAC class. I remember asking my teacher, I don’t want to sound stupid, but what does HVAC even stand for? I didn’t know it was for heating, ventilation and air conditioning.

I was 19, right out of high school. I was one of the younger ones there.

ICM: Not only were you one of the younger ones, but how many women were there?

Faber: Most of the young women, if we had any, were in the electrical program. I was the only one in the HVAC class. I had a couple of teachers telling me that I was the first woman in the HVAC program in about 10 or 12 years. Women make up about 2.6% of those in the field for HVAC in the U.S. There are not a lot. There are a lot more electrical girls.

ICM: Were there any obstacles? How did you find the reception from the other students and the instructors?

Faber: I have to give my teachers credit for all the support I received from the school. They were very encouraging. They were very excited to have a woman in their class. The guys kind of tried to tone down their [bad] language, but I didn’t care how they spoke. I said, You can do what you want. I have brothers, I hang around guys. They were respectful.

ICM: How long was the program?

Faber: I took day classes, which was a little bit shorter than night classes—about seven months. It was a 600-hour program. I had a little bit of financial aid that helped me, and I was working while I went to school.

ICM: In addition to advancing from ETC, you are also a National Oilheat Research Alliance (NORA) Bronze Technician Certified. How did you hear about NORA’s oilheat certifications?

Faber: I learned about NORA from my teachers. When they told us we were going to prepare for the NORA Bronze Exam, I thought, Great, another certification I could put on my resume. You can only better yourself.

ICM: Did you know anything about oil heating before?

Faber: I knew nothing. I didn’t even know how to hold a wrench. I didn’t know the difference between a flat head and a Phillips screwdriver.

ICM: The classes, the NORA prep and exam was your first exposure?

Faber: Yes, I learned it all from NORA—that was my first experience with oil heat.

ICM: Oilheat is a very specific subset of HVAC; did you feel prepared to pass the NORA exam?

Faber: I thought the teachers were very thorough and I definitely felt prepared. They had us take practice tests. We read the textbook and they answered questions. They did a really good job preparing us.

ICM: You graduated and got your NORA Bronze certification. You also earned your other certification from the school. Then you needed to get a job?

Faber: Getting a job was really difficult. I called a few companies and I guess they heard my female voice and just didn’t take me seriously. I actually got laughed at by two companies. So, it was kind of rough. I finally got an interview, which was very exciting. I was applying for HVAC technician. I wanted to learn, I wanted to be in the field, but they offered me a job in the office. I couldn’t believe it.

It got better after that. I got an offer at a commercial company, which I thought was cool. I also got an offer from Petro Home Services. I thought it would be a really good place to learn and it was a union position. I accepted their offer.

ICM: Did the NORA Certification help in your job search?

Faber: Yes, it did.

ICM: Can you tell me which branch of Petro Home Services you are working out of now?

Faber: I’m out of the Hicksville , NY branch. You know Wayne Lawrence, right?

ICM: Yes, he is an instructor at Petro.

Faber: I took some of Wayne’s classes; he is a genius. Petro is good about training. They pay us to attend, which is good for both me and the company.

ICM: Once Petro hired you as a technician, did you ride with someone for a while?

Faber: Yes, I rode with someone to train for about three months. When I was ready to do tune-ups on my own they said, Let’s go for it. They put me out on my own for tune-ups and some service calls.

Being so new, I would call other technicians with questions. Some of them had my back all the time. If I got stuck, I would call them up and they would help me out with FaceTime if I got stuck. That really helped. They would even take my calls when they weren’t working. I could hear their kids playing in the background. They were great then and still are to this day.

ICM: Do you want to mention their names?

Faber: One was Donnie Ducas. He teaches with Wayne and is a great guy. Matt Ryan was another one. He’s one of the guys I trained with for a while, and he really wants what’s best for everyone. He’s an amazing trainer and has so much patience. Those two guys are my go-to guys.

ICM: When a homeowner calls Petro and a young woman shows up, what’s the reaction? Or is there a reaction?

Faber: There is always a reaction everyday, at least once, if not three times, I hear, oh! I didn’t expect a young women to come. I already know it’s coming before it even happens. A lot of people are very supportive but also there’s some people that aren’t and I have taught myself to filter it. I take the good and leave the bad, because I don’t want that negativity in my head. There has been times when customers have underestimated my ability due to my age and gender. Also, there’s an older generation that hasn’t accepted females in the field yet, but when I fix a no heat call or solder in front of customers, they see my ability to help, then they seem to be more comfortable with me being in this field. I hope that the percentage of HVAC women will increase over the next years, in that way it will be more accepted by others.

ICM: Is there anything particularly challenging about the oil heat work versus any other HVAC work, or is there anything you like about it that stands out?

Faber: I like the fire part. I like to be able to test and manipulate the setting to get a good flame. If you’ve ever been in the field, you know that there’s always those customers that just watch. So, I always engage with them. I’ll ask them if they know about their boiler. I’ll open the little chamber door and show them what’s going on inside. It helps them to understand and to accept me as their technician.

ICM: Petro has committed to switching all of its customer base to a blend of 20% biodiesel with heating oil. This is essential for the whole industry going forward to be able to reduce greenhouse gasses. Did you get any special training or education from Petro on the Bioheat® transition?

Faber: Yes, we had meetings and training sessions about it. It was a good chance to understand and to contradict some of the rumors out there. Someone came from NORA to talk about the research it has done; they gave us an education.

ICM: Do customers ever ask you about greenhouse gases or the Bioheat® ?

Faber: I’ve had a couple of people—and I don’t know where this is coming from—who said they didn’t like that new B20 because they heard it’s going to cause problems with the fuel pump. Some were concerned that it would burn faster. There were many comments that people made to which I replied, No, I don’t think that’s how it works. I attended some Oil & Energy Service Professionals meeting where this kind of thing was talked about.

ICM: How long have you been in the field?

Faber: About one year and nine months.

ICM: Has anything surprised you?

Faber: I’ve been stuck on calls. I don’t know if that’s a surprise, but it happens. Fortunately, I have the support system to lean on.

ICM: Where would you like this career path to take you?

Faber: I just want to learn more and move up. I want to know everything about oil. Then learn everything about gas, everything about steam, everything about AC. From there, I want to learn something else, generators, propane, whatever it is. First though, I really just want to focus on mastering oil, and I just want to keep going, increasing my skills. ICM

More about NORA certifications & training and to visit the Technical Resource Center, go to Learning.NORAweb.org

 

Vermont Attacks Carbon Reduction with Incentives

As the Northeastern states aggressively move to reduce GHG emissions, Vermont is offering financial incentives through a credit program. ICM spoke with the Vermont Fuel Dealers Association Executive Director, Matt Cota, about the genesis of the program and what it might mean to liquid fuel retailers in the State.

Matt Cota

ICM: Vermont is one of the most aggressive states in the Northeast when it comes to reducing carbon emissions. Electric utilities are now required to purchase 59% of their power from renewable sources and 75% within the next 10 years. How are liquid heating fuels impacted by Vermont’s renewable energy mandates?

COTA: Vermont’s energy policy to eliminate the use of petroleum started in 2011 with the passage of the Comprehensive Energy Plan. A decade later, we are still selling about the same amount of heating oil, gasoline, propane and diesel fuel. The failure of this energy policy is what led to the 2020 Global Warming Solutions Act, which replaced the goal of eliminating fossil fuel with a mandate to substantially reduce greenhouse gas emissions (26% below 2005 levels by 2025, 40% below 1990 levels by 2030 and 80% below 1990 levels by 2050).

Over the past year, the Vermont Climate Council created a Climate Action Plan that recommends more than 200 actions be taken in order to meet these mandates.

When it comes to transportation, the plan is to first tax and then eliminate the sales of new cars with combustion engine that use gasoline by 2035. The Action Plan calls for a “Fee-Bate” wherein combustion engine are charged a higher registration fee that will be used to provide incentives for electric vehicles (EV). In addition, there is money available from the Federal government through the American Recovery Act that will help pay for electric car chargers and additional EV incentives.

When it comes to heating, most policymakers, regulators and lawmakers recognize that we will need more than just electricity in order to meet Vermont’s greenhouse gas emission reduction mandates. We will need biomass and renewable liquid fuels, which is significant.

Over the past decade, the Vermont Fuel Dealer Association (VFDA) has emphasized that we have a drop-in fuel that can reduce greenhouse gas emissions in Vermont and the Climate Action Plan has finally recognized this.

For the first time in Vermont, environmental advocates and regulators understand that the existing infrastructure—tanks, trucks, boilers, furnaces, burners—can be used to reduce carbon emissions by changing the fuel rather than the equipment.

ICM: What is the regulatory tool to get more heating oil retailers to sell renewable liquid tools?

COTA: It is called the Vermont Clean Heat Standard (CHS). Over the next 18 months, this concept will be debated by the legislature and then go through a long regulatory process.

Rather than a biofuel mandate that dictates blend levels, the CHS provides revenue to oilheat retailers that choose to sell biofuels.

Selling renewable liquid heating fuel to Vermont consumers will generate a credit under the CHS that must be purchased by wholesale suppliers of oilheat, propane and natural gas. A wholesaler would be able to lower its obligation by selling higher blends of renewable liquid fuel into the Vermont market. The program design is similar to a low carbon fuel standard for motor fuels that we’ve seen in other regions.

ICM: So, the renewable liquid fuel has to be delivered in Vermont?

COTA: Exactly. It is not a situation where a wholesaler could purchase solar panels in California or a wood pellet factory in North Carolina to meet their obligation. Credits can only be obtained by those that can demonstrate a reduction in emissions within the boundaries of Vermont. It could include any company whose product or service reduces thermal carbon emissions in Vermont.

The basic architecture of the plan is to provide financial incentives for heating fuel and service providers to weatherize homes, install more efficient heating equipment, install wood pellet stoves and cold climate heat pumps, as well as deliver renewable liquid and biomass heating fuel. All help reduce greenhouse gas emissions and will generate credits.

How much credit each product or service is worth has yet to be determined. The credits have value because of the obligation of fossil fuel wholesalers to obtain them.

ICM: Sounds like a good opportunity for retail energy providers.

COTA: It does provide an opportunity for those heating fuel and service providers that are ready, willing and able to sell renewable liquid heating fuels. Those that don’t sell biofuels will be able to continue sell oilheat and propane, but they won’t have any credits and won’t benefit from that revenue stream.

ICM: How might this affect the price of the fuels?

COTA: If a wholesaler is required to pay a fee to when selling natural gas, propane, heating oil or kerosene in Vermont, the cost paid by the consumer will also go up. This isn’t great, but it is better than the alternative, which is a ban on oil and gas-fired heating equipment. It also provides a new revenue stream for those selling a low carbon fuel and providing efficiency services.

ICM: This is quite a turnaround for Vermont, how did you pull this off?

COTA: The Vermont Climate Council gathered virtually over the past year, working with consultants on a strategy to meet the mandates in the Global Warming Solutions Act.

VFDA members were consistent in the approach, advocating for a nonelectric pathway. We presented testimony that demonstrated biodiesel blended heating oil can help reduce greenhouse gas emissions and keep these historical heating fuel heating service companies in business. We also made a compelling argument that since we are a drop-in fuel, we can reduce emissions immediately and at a lower cost.

More about VFDA at VermontFuel.com

ICM: When does the Clean Heat Standard need to be enacted?

COTA: Many items in the Climate Action Plan will happen by the end of 2022. However, some of these proposals, including the Clean Heat Standard, must be approved by the legislature and then go through a regulatory process before the Vermont Public Utility Commission. This could take two years.

ICM: How will the credit market be operated? Who is collecting the money and who is paying on the credits?

COTA: There will be a role for some nonprofits to play that will determine that value of credits, approve payments, and collect funds from wholesalers. The rulemaking procedure will determine how this process works.

ICM: Like many States, Vermont was all-go, all-electric. However, Connecticut just passed a biofuel for heating mandate, New York just expanded theirs to the entire State, and Rhode Island also has a mandate. Massachusetts has the Alternative Fuel Standard offering credits for biofuels. How did your group tip the scales in Vermont from being an anti-oilheat state to suddenly offering incentives to deliver renewable liquid fuels?

COTA: Many factors are involved. National Energy & Fuels Institute’s (NEFI) NetZero Resolution absolutely helped with messaging. The commitment by heating equipment manufacturers to sell burners that are compatible with B20 and beyond is critical, as is the lab work by the National Oilheat Research Alliance (NORA) on both renewable liquid fuel and the equipment it runs on. The expertise and advocacy of the National Biodiesel Board (NBB) is incredibly influential.

There is also wider acknowledgement of the existential threat facing those that sell heating fuel or heating equipment. Understanding that this market is changing and consumer sentiment is changing, we could be regulated out of business if we fail to adapt. The Clean Heat Standard may be the last chance for traditional oilheat companies in this new political environment. We also provide the most plausible pathway to reduce carbon emissions in order to meet the State mandate.

ICM: It seems like there is a little bit of a crack in the in the all-electric or nothing movement. Now there seems to be room for renewable liquid fuels. Are you seeing that in the larger picture?

COTA: Certainly, the all-electric energy policy could become a victim of its success. In Vermont, electricity demand is expected to more than double as more people use electric heat pumps and electric cars. As the all-electric energy policy ripples throughout our region, peak demand for electricity during a winter cold stretch could result in rolling blackouts.

The fuel industry doesn’t have the same constraints. We have the tanks, trucks, equipment and people to deliver a product to keep millions of people warm.

ICM: In making the case with the public policy people in your State, did the cost of heat pump conversions come into play? In Vermont, where you have almost all boilers and little air conditioning, whole-house heat pump conversion could be $20,000–$30,000, which is difficult enough for most homeowners but would disproportionately hit lower income people in your State. Is that accurate?

COTA: Most of the modeling underestimates the cost of the installation and the number of splits needed to cover the entire thermal load. In the vast majority of installations in Vermont, electric heat pumps are used for heating and cooling a room and are not a whole-house conversion technology.

ICM: You mentioned the last time we spoke that Vermont was considering incentives for low income Vermonters to purchase biofuels. What’s happened with that proposal?

COTA: With the passage of the American Rescue Plan Act of 2021, there is money available for Vermont to help low-income homeowners reduce their energy burden and lower carbon emissions. We are working with the Vermont Clean Energy Development Fund to use some of that money to incentivize the purchase of biodiesel in place of heating oil.

While we advocated for biodiesel blends, the Vermont Clean Energy Development Fund Board approved a plan to subsidize only B-100. While it is not operational yet, we are still working with staff on how to implement this program.

ICM: It seems the philosophy of accepting these low-carbon liquid fuels in many States is an important move forward and something we weren’t seeing a year or two ago. Is there room to be optimistic?

COTA: Absolutely. While we fight the effort to eliminate the fuels we currently sell, we also need to provide a pathway to deliver a lower carbon liquid fuel in the future. I am optimistic that we can get both done. ICM

In June of 2021, the Connecticut Energy Marketers Association (CEMA) ushered in a low carbon liquid fuel mandate in the state.

ICM: Can you tell me what the mandate is for, what the time frame is and what fuels it includes?

CH: It includes No.2 heating oil and starts July 1, 2022 at a 5% (B5) blend with a renewable fuel, B10 in July of 2025, B15 in July of 2030, B20 in July of 2034 and B50 in July of 2035.

ICM: It is at 20% in 2034 and then in one more year it increases to 50%? That is an aggressive jump.

CH: It is. We achieved CEMA’s goals in having a slow ramp-up to provide the industry time to prepare, even though that is indeed a big jump at the end. Frankly, we have to be at B50 in time to comply with the law for CO2 reductions. It gives fuel wholesalers, equipment manufacturers, technicians and operations people time to be fully versed in handling that blend level. Now everybody can circle the date on the calendar. Obviously, the fuels must be ASTM compliant.

ICM: The Connecticut Comprehensive Energy Strategies over the years has been very unfavorable towards liquid heating fuels. How did you get this mandate?

CH: It is remarkable in Connecticut to have a bill introduced and in the first year have it passed into law. David Arconti, Chairman of the House Energy Committee, was a sponsor of the bill in reaction to regulators’ aggressive posture to get rid of liquid fuels. He told us the legislature was not going to be able to hold the electrification dam back anymore unless we can measurably demonstrate that we can lower CO2 emissions in heating oil fired appliances. That was really the genesis of the bill and our Executive Committee allowed me to negotiate language that would work best for our members.

We started a relationship with Arconti before he was elected six years ago. We brought him in to educate him about natural gas conversion. We had no idea that he would get elected at that time. We were just prepping a candidate on our issues, and it paid immense dividends in terms of now having a key player in the policy space for energy who believes in what we do.

From there we partnered with American Green Fuels in New Haven, CT, the National Biodiesel Board (NBB), who, along with the National Oilheat Research Alliance (NORA), was extremely helpful in providing us data to support our claims that biodiesel and other liquid renewable fuels, such as renewable diesel, could play a role in significantly reducing greenhouse gas emissions and allow our members to comply with Connecticut laws that require GHG reductions.

ICM: Did you have opposition from environmentalist groups, the electrification faction or other groups?

CH: Yes, it seemed like we got opposition from everyone. It started with the Dept. of Energy & Environmental Protection (DEEP), who authored the comprehensive energy strategies that endorsed natural gas conversion and now electrification. They speak on behalf of the Governor, so their opposition carried the weight of the governor behind it, which made it a very steep sell. The commissioner of DEEP today was the Deputy Commissioner under the natural gas conversion plan. This gave us a little bit of leverage when we spoke with legislators. We were able to say, “This was the same person who told you, seven years ago, that natural gas was cleaner, cheaper and more reliable. Now she is telling you the same thing about electricity, and your constituents, who were told to switch to natural gas, are now being told that’s no longer any good either and they have to switch the electricity.”

It’s an agency full of scientists, engineers and PhDs and there’s a lot of value in what they say, but because they were wrong before, we were able to at least say, “can you listen to us?” Coupled with NORA and NBB support, we were able to stand toe-to-toe with their scientists, engineers and commissioner.

Further, at the public hearing, groups like the Sierra Club and other environmental organizations came directly at us, appealing especially to the majority Democrat party, saying that this was all a way to perpetuate the use of fossil fuels. Our chief response was that there’s going to be a segment of the population who will never be able to afford to convert to any other fuel, whether its electricity or another. However, we can start lowering CO2 emissions for everybody without waiting for a theoretical future of zero emissions through electrification that, when you do the math, just doesn’t seem very credible.

ICM: So, science tipped the scales?

CH: Yes, we were not going to win by finding enough sympathy in the legislature for not hurting small, family-owned businesses. Frankly, most elected officials just don’t care anymore. If we did not have science on our side, we would have seen a full electrification bill this year.

 

 

 

 

ICM: Many people in this industry are dead-set against mandates. What about the liquid fuel marketer community in Connecticut? Did you have opposition there?

CH: Internally, it was a process. I credit National Energy Fuels Institute (NEFI) with the Providence Resolution for bringing attention to the need for the industry to be able to publicly state that we need to aggressively move to low carbon liquid fuels. The second thing was the shift in the equipment manufacturer community to start sending signals out to their customers that they were working on a B50 burner or a B100 burner. I think that sent shock waves throughout a segment of our industry that would never have otherwise gotten on board with this. I think the third factor was Project Carbon Freedom where the fuel wholesale community united to say, “We need to change this fuel if we want to have a future, we are going to help you with marketing and communications. Then whole other segments of the industry—retail company owners, terminal operators—said, “Okay, this can happen.”

All these things didn’t exist a couple of years ago, but when the bill was raised last January, then they came together. If not for all of that, we would have been looking at an extinction-level event. If you walked up to every single CEMA member and asked if they supported this, you would not have heard unanimous support, so there is still work for us to do. Our Board of Directors made those hard decisions about allowing me to negotiate mandates after months and months of debate and consideration. We found ourselves in a position where we had no other option if we wanted to continue a deliverable liquid fuel business.

ICM: Do you have concerns about product supply as you ramp up?

CH: I believe that New York, Rhode Island and Connecticut all have blending requirements in place because their time frames are stretched out and the demand for the product is going to be at different times. The people who have to produce, transport and store the product will have ample time to meet a B50 blending requirement.

ICM: What happens if biodiesel prices rise?

CH: That allows me to tell one of our strongest stories. I don’t know the answer, but what I do absolutely know—and there is no avoiding it—is that electric heat will absolutely, categorically cost more in the future. Tens, if not hundreds, of billions of dollars will be needed to construct enough wind and grid scale solar, upgrade every power line, every transformer and every residential electrical service. On top of that, we’d have to convert to another technology in the home—the heat pump—making the cost overwhelming. Even if your assumption is that bio-heating will be more expensive in the future, it will not be anywhere near the cost of electricity and the cost to convert to electric heat pumps. ICM

As New Jersey faces public policy to mandate all electric home heating, the Fuel Merchants Association of New Jersey answers through its Executive VP, Eric Degesero

ICM: Eric, can you give us some background on the public policy climate in New Jersey as a relates to climate change and home heating?

ED: Just as with many other states in the Northeast, New Jersey is looking to move to zero-carbon energy by 2050 and that is something we’re fully on board with. The challenge and the concern is that New Jersey Governor Phil Murphy’s Energy Master Plan calls for eventually all electric generation to be done through renewables, primarily solar and wind. One aspect of the Energy Master Plan that he has not spoken about publicly calls for electrification of all space and water heating in the state. Nor has he discussed the cost, the exorbitant and unnecessary, almost irrational cost of doing that. The Governor is saying, “I want zero-carbon energy by 2050, and there’s only way you can achieve that and that is through electrification.” That, and only that, is the problem we have. If policy makers would just be willing to listen to us, our ideas are not actually that far apart. Of course, our pathway to zero carbon is through the rapid adoption of low carbon liquid fuels for space heating and hot water. You can achieve the policy objective of zero carbon without the significant infrastructure disruption of electrification. I am not talking about the big picture—distribution and transmission systems for electricity—but the disruption of the infrastructure of our individual homes and businesses. No one in officialdom has either a) any idea what it entails or b) if they do, they have been extremely disingenuous with the estimated costs.

ICM: If electrification becomes the policy, how will that affect the homeowner in cost?

ED: In New Jersey, 87% of homes are heated by a fossil fuel. The first challenge that a homeowner is going to have is the cost to convert their system to all-electric. Even if you have a forced air system or if you have an air conditioning system with a boiler, that still doesn’t mean that you can just drop in a heat pump for a $4,000–$7,000 one-time cost, which is what the Governor indicated in the draft Energy Master Plan. His cost assumption came from a study in Massachusetts that added heat pumps into rooms. That’s where they got the $7,000 cost, not the retrofit of the whole house, along with the installation of backup electric resistance. Just looking at the mechanical system itself, it’s actually going to cost well over $20,000. We get that number from research that has been done by Diversified Energy Specialists in New York and Massachusetts. An alarming thing about this $20,000 figure is that, in well over 90% of the instances of the homes in this research, homeowners kept their existing fossil fuel heating system as the backup. Therefore, that $20,000 number is understated because it didn’t go as far as what the New Jersey Energy Master Plan is calling for.

You are going to be using a lot more electricity. There is something that is being discussed called time-of-use pricing wherein you are going to pay different rates during the day based on when the energy company wants to disincentivize electric consumption. Peak hours are, generally speaking, late afternoon into early evening. When you need the electricity the most, it will be charged at the highest rate. The Governor, as of this discussion, has yet to provide a cost estimate on anything relative to the Energy Master Plan, except the one time $4k–$7k cost estimate for a home, which is absolutely wrong.

It isn’t just the Fuel Merchants of NJ that is opposed, it’s the air conditioning contractors, the plumbing organizations and the mechanical contractors. They are the people that are installing, servicing and maintaining systems and are unanimous in saying that this is a bad idea.

ICM: If you’re going to convert all of New Jersey to electric heating and cooling, that’s a lot of work. That’s a lot of jobs. Why are they against it?

ED: Great question. They’re against it because, in addition to being business owners or employees, they are also consumers and homeowners. They don’t want to have to do something that they know doesn’t work in the way the Governor says he wants. What we’re engaged in is not an anti-heat pump campaign in any way, shape or form. What we are engaged in is a campaign that opposes heat pumps as the one and only singular means to heat a home, requiring you to rip out your existing heating system to do it.

ICM: Even$4k–$7k is a lot of money for many homeowners, and in reality, it is going to be more like $20k–$30k. Is there a plan for subsidies?

ED: They says they are constantly evaluating costs, which is all nonsense. They are backtracking because they got called out on their nonsensical cost estimate. When everyone must throw in money to subsidize something, that’s called “higher cost of living—higher electric rates.” The frustrating thing is that most of the public and most of the State legislature was not aware of this until the Smart Heat NJ campaign (a comprehensive multimedia advocacy campaign from Fuel Merchants Association of NJ to educate consumers about the costs and consequences of the Energy Master Plan, specifically the expense) was launched to begin the process of educating the public and, by extension, the legislature.

Not only can the Governor implement the Master Energy Plan without legislative input, the process of writing the regulations to make this happen has begun. NJ legislature has a small window of opportunity to enter into the debate and that’s what we hope they will do—not just because it is hearing from trade organizations or trade unions, but hearing from the public as well.

Often when you engage in grassroots lobbying, a trade association will brief its members on the specifics of the issue and then engage policy makers in a letter-writing or email campaign and request meetings with legislators to educate them. This is too big, too complicated and too difficult to understand and there’s too many people in too short a period that need to be educated to move the needle.

This time around, we are lobbying in a way similar to that of big campaigns, using public relations and media settings. None of us has enough leverage to get the Governor to change his mind, so we need to get the legislature engaged and the only way to do that is to get the public engaged. The public should be concerned about the negative impact on them personally and they’re not even aware of the Governor’s policy.

ICM: Tell me about Smart Heat New Jersey and how you’re trying to get legislators on board.

ED: Smart Heat NJ is digital; it’s some television, it’s traditional marketing, media, and public relations all making the case that the mandatory wholesale removal of existing heating systems to be replaced with electric heat pumps is both prohibitively expensive and ineffective. I know we’re driving results because legislative offices are hearing from their constituents that this electrification plan is a bad idea, and they’re hearing that through the Smart Heat NJ campaign.

One thing I want to add is that legislators are consumers as well. Legislators own homes and have personal finances. They are hearing from their constituents and are also seeing the Smart Heat NJ ads on television or the billboards along three main toll roads—the New Jersey Turnpike, the Garden State Parkway and the Atlantic City Expressway. The message is out there. Legislators aren’t only hearing from their constituents; they’re seeing this as consumers of news and as consumers of home energy and home energy systems.

ICM: In addition to the Smart Heat NJ website, you’re also doing TV advertising, cable advertising, billboards and I heard you even had an airplane flyover at the Jersey Shore on Memorial Day weekend.

ED: In some instances, it’s an ad on your phone and in others, it’s Facebook and sometimes, yes, it’s an airplane pulling a banner up and down the Jersey shore.

ICM: When I speak with you, I hear real urgency in your voice.

ED: The real death knell that we face as an industry is a State-by-State process where the police power of the state says, “Here is how we’re going to do it and here’s the time line that we’re going to do it on.” Generally speaking, 2050 is the magic number. Some States require legislation, some States require regulation, which is what you’re going to see in New Jersey unless the legislature injects itself into the discussion.

ICM: If total electrification is not the answer, what do you consider the answer to be?

ED: We’ve had the answer for some time—renewable liquid heating fuel. It’s frustrating that we’re not further along than we currently are, but that doesn’t mean that we can’t be where we need to be in the time the policy makers want us to be there. The problem is that if we start using renewable liquid heating fuel now, we’re not going to be allowed to continue to do so. In a counterintuitive way, this policy is actually hindering the reduction of carbon emission, because we could be reducing carbon here and now. All we need to do is to fine tune what we’re doing to bring higher and higher blends of renewable fuels into the market. That message hasn’t been able to penetrate yet and hopefully the Smart Heat NJ initiative will at least allow the legislature to weigh in about whether or not it thinks renewable liquid heating fuel is a viable means forward.

If we can get the legislature on board, it is going to have to get engaged and help Governor Murphy to be willing to discuss moving forward in a different direction. More than anyone else, the legislature has many points of counterpressure it can put on the Governor.

ICM: You say that the legislature’s pressure on the governor is probably the only path to get this change in policy and you’ve had the Smart Heat NJ program in place since Labor Day 2021. What kind of response are you getting from NJ legislators?

ED: It’s the only path. I’ve been out and around the State talking to legislators and their staff and not only are they seeing the ads themselves, but they are hearing from their constituents. If you can get 40–60 constituents contacting a legislator, that legislator is going to pay attention. Senator Vin Gopal, a Democrat from Monmouth County, is a very strong supporter of progressive social issues and has supported every aspect of the Governor’s Energy Master Plan. He fully supports wind energy, solar energy and electrical vehicles, but said there is just a little too much here, it’s too big, and the legislature hasn’t been engaged enough to have a discussion on the Energy Master Plan. Our job is to work with Senator Gopal and other like-minded legislators from both parties. This is by no means a partisan issue at all. Quite honestly, in the past few weeks, I’ve been heartened by the support of Democrats—members of the Governor’s own party.

ICM: The Governor’s Energy Master Plan is already out, does it have teeth? I assume regulations must be made to implement the plan— what’s the time frame on that?

ED: The Energy Master Plan is nothing more than a than a wish-list document that could sit on a shelf somewhere and does not have teeth on its own. However, it’s a wish list of the one person that gets to set policy for the entire State. The Governor has the tools at his disposal to implement the electrification of the building sector through the Dept. of Community Affairs through building codes. The Northeast Energy Efficiency partnership (NEE) is in the beginning stages of coordinating stakeholder meetings to discuss having regulations in place by 2024–2025 to outlaw combustion. That doesn’t necessarily mean combustion will be outlawed by 2025, but regulations may be in place so that, on an equipment turnover, combustion may be outlawed by 2028 or 2030.

ICM: Could a new Governor just turn off the switch?

ED: They could, but once something is formally adopted, it’s much more difficult to undo. At the end of the day, if the legislature thinks electrification is a good idea and that the Governor is on the right path, we lose. At least then I will have had the satisfaction of knowing that our policymakers weighed in. Let’s agree to zero-carbon energy by 2050. Let’s give everybody a chance to build their own pathway to get there and to demonstrate what the benchmarks are on that pathway not just some ethereal dream, but a realistic way to get there. Then let’s work. Let’s put our energy and resources into the low carbon liquid fuels pathway because we can get to the goal for a lot less expense and possibly get it faster than retrofit electrification.

ICM: Readers of ICM are in the mechanical HVAC trades in New Jersey. What can they do to help support your message?

ED: Whether you’re an HVAC contractor or not, if you’re a homeowner concerned about unnecessary costs that aren’t going to achieve the objective of keeping you warm, you need to go to SmartHeatNJ.com, click the “Contact Your Legislators” button, populate your ZIP code and put your name in along with a short message. We have an auto populated message, but we encourage everyone to include their personal concerns with this plan.

The legislature needs to get engaged and the only way that will happen is if they hear from their constituents. All we’re asking is to let your voice be heard if you think retrofit electrification is a bad idea. ICM