The BTC has been a cornerstone of the renewable fuels market, providing crucial financial support to blenders and facilitating the adoption of biodiesel and renewable diesel. As we move towards 2025, however, the phase-out of the blender’s credit raises concerns about market stability and product valuations. The Clean Fuel Production credit, set to replace the BTC on Jan. 1 2025, offers incentives to fuel producers based on the carbon intensity of their feedstocks. This shift places greater emphasis on the sustainability of the entire production process, from feedstock selection to final fuel output.
While the new credit aims to drive innovation and promote cleaner fuels, the transition is not without challenges. The erosion in the value of renewable identification number (RIN) credits further complicates the scenario. Historically, RINs have provided an additional financial incentive for renewable fuel producers, but fluctuations in their value—particularly in the past year or two—have created uncertainty in the market. As we prepare for 2025, it’s essential to develop strategies that do not solely rely on these government incentives.
The Rise & Implications of Renewable Diesel
The introduction of renewable diesel to the East Coast has added yet another layer of complexity. Previously, the focus was primarily on biodiesel as the transition fuel for cleaner on- and off-road transportation fuel and heating oil. Renewable diesel, though a less complex alternative in terms of storage and handling, was largely confined to markets with robust low-carbon fuel programs, such as those on the West Coast.
Renewable diesel’s acceptance under the ASTM standards (D396 for heating oil and D975 for on-road diesel) makes it a more straightforward option for blending with traditional distillates. Its seamless integration into existing infrastructure presents renewable diesel as a “simpler” solution, alleviating some of the operational challenges associated with biodiesel. This simplicity, however, should not overshadow the importance of maintaining a diverse supply chain.
A Multifaceted Approach to Low-Carbon Fuels
As someone who has represented the low-carbon fuels industry for nearly three decades, I’ve witnessed the evolution of technologies and market dynamics. Our industry now boasts a range of products, including biodiesel, renewable diesel and sustainable aviation fuel, each with its unique benefits and challenges.
Adopting a feedstock-neutral and technology-agnostic approach is vital for long-term success. Relying on a single, low-carbon option could weaken our supply network and compromise our ability to meet consumer demand. The potential disruption of removing approximately 60 domestic biodiesel producers, who collectively supply two billion gallons per year, underscores the importance of a balanced supply strategy. Such a move would likely paralyze the market, making us overly dependent on a single fuel type.
Marketing Strategies for a Diverse Fuel Portfolio
To effectively market our products, we must highlight their unique characteristics and advantages over, not just traditional distillate fuels, but also other alternatives, such as electrification. The current state of the power grid makes the widespread electrification of transportation and space heating infeasible and ill-advised.
Energy stakeholders should focus on educating consumers about the benefits of low-carbon liquid fuels. This includes:
•Performance & reliability: Emphasize the proven performance and reliability of biodiesel and renewable diesel. Both fuels offer significant reductions in carbon emissions without sacrificing efficiency or performance.
•Environmental impact: Highlight the environmental benefits, such as lower greenhouse gas emissions and reduced air pollution. This is particularly important for consumers increasingly concerned about climate change.
•Economic benefits: Stress the economic advantages, including job creation in the renewable fuels sector and energy independence. Diverse fuel sources can protect consumers from price volatility in global oil markets.
•Compatibility: Address concerns about fuel compatibility and infrastructure. Both biodiesel and renewable diesel can be used with existing vehicles, heating systems and storage facilities, minimizing the need for costly upgrades. Check out that trend on the West Coast, where blends of 95% renewable diesel and 5% biodiesel (95/5), as well as 80/20, are the norm.
The Path Forward
As we navigate these changes, collaboration and innovation will be key. Industry stakeholders must work together to develop robust supply chains that can withstand policy shifts and market fluctuations. This includes investing in advanced technologies and diversifying feedstock sources to ensure a steady supply of low-carbon fuels.
Government policies will continue to play a significant role in shaping the market, but we must also prepare to operate successfully without relying solely on incentives. By promoting the unique value propositions of biodiesel and renewable diesel, we can build consumer confidence and drive adoption.
We all have an obligation to learn as much as possible about these fuels. Plenty of educational materials exist and is readily available; if you don’t know something but want to, ask someone who might.
Diversity Means Energy Security
Diversity in supply is not just relevant, it is imperative for ensuring energy security in all fuel-consuming sectors. By embracing a range of low-carbon fuels and developing strategies to market them effectively, we can achieve a sustainable and resilient energy future. This approach will not only meet the immediate needs of consumers, but it will also position the industry for long-term success in a low-carbon economy.
Objects are Closer than they Appear
I have one final thought to leave you with. The mirror on the outside of a car’s passenger side often contain a message that reads, “Objects are closer than they appear.” As we look to the future, it’s clear that the path to decarbonization is closer than it appears, but traveling this road to our final destination will require flexibility, innovation and a commitment to diversity. Those involved up and down the supply chain, from producers to fuel distributors and end-users, must be prepared to adapt to changing market conditions and policy landscapes to get there. By doing so, we can ensure a reliable supply of clean, efficient and affordable energy for all. ICM
With all the challenges that the retail liquid heating marketer faces today—including diminishing degree days, regulatory uncertainty, and the difficulty in identifying and hiring qualified drivers and technicians—there lies another reality that is emerging year over year. The new, younger liquid heating customer is far more conscious of the environment and reducing their carbon footprint than their parents were. Last year, I spent my time on the conference circuit sharing the findings from the Pew Research Center’s June 28, 2023, report entitled “Majorities of Americans Prioritize Renewable Energy, Back Steps to Address Climate Change,” which provided an unequivocal data set and it posed a generational question for our industry.
Are we in the business of delivering high carbon fuels and services or are we in the business of delivering low carbon products and services?
This is not an existential or political question. It’s a simple decision that will likely guide your organization forward over the next decade. If we do not realize where the market is moving and freely admit that we cannot change it, then this question gets a little easier to solve. Just to be clear, we are talking about going Green here, environmentally for sure, but also and more importantly, financially as well. Carbon freedom is not free; there is a cost to decarbonization that every industry is facing.
The advantage that our industry has is that our cost of decarbonization is nominal at best and our transition costs to our customers are minimal. The NORA team will be hitting the road soon, sharing some of the advancements that we are working on to assist the liquid heating market in these important transitions to low carbon liquid fuels. Presented below are some of the initiatives that we are working on in 2024. As always, we welcome the opportunity to speak with your State or regional association.
Low-Carbon Renewable Fuels Testing
The road to decarbonizing an industry is paved with many research and development projects and initiatives. For the liquid heating industry, NORA is presently focusing on the testing of advanced biofuels such as biodiesel and renewable diesel and how they are integrated with technological advancements in new burner technology, higher efficiency boilers, furnaces and hot water appliances. The overall goal of the work at NORA today is to address any technical barriers to the widespread conversion of the liquid fuels heating industry from fossil fuels to high blends of renewable biofuels, including biodiesel and renewable diesel. The testing we have conducted, thus far, has produced very good results with these fuels in the NORA lab.
NORA is actively testing 100% renewable fuels for liquid heating at its Research Center in Plainview, NY. Powering heating appliances with 100% low-carbon renewable fuels will drastically reduce carbon emissions while allowing consumers to benefit from the opportunities provided through the Inflation Reduction Act (IRA) of 2022. The IRA provides for a $600 tax credit for purchasing a new liquid fuel heating appliance approved for operating with higher blends of renewable fuels.
This past heating season, NORA has conducted B100 field tests at 12 sites on New York’s Long Island and six sites in Massachusetts (with a nominally distilled biodiesel). Additionally, these field tests are providing very high-quality data points on changes in fuels over time during the heating season and summer season and on service requirements with high biodiesel blends. These field tests provide critically needed information to manufacturers, fuel marketers and potential fuel users to help with equipment design and planning of storage and delivery logistics. Five new sites are being added now in Maryland and during this past year, the scope of the testing has broadened to include new B100 burners released by Carlin and Beckett. Aside from providing test locations for these new burners, the field tests are critical in providing realistic environments for evaluating lessons learned from the in-lab tests.
Transitioning to Low-Carbon Fuels
Currently, there is increasing interest in the Northeastern region of the U.S. in renewable diesel as a renewable transportation and liquid heating fuel, which could be used at 100% or blended with biodiesel up to 20%. Starting in the 2024/2025 Winter season, NORA will be seeking to sharply increase the number of test sites using RD or RD/Bio blends. NORA has been approached by a renewable fuel producer with a strong interest in exploring 100% renewable liquid heating R&D fields test. Prior to the start of the next heating season, we are planning to have a regional workshop with marketers and interested manufacturers to gauge interest and plan logistics around this R&D project. If your organization is interested, please let us know.
NORA will continue its collaborative work with Clean Fuels and other industry stakeholders to identify additional emissions data, which may be needed to support increased use of biodiesel and renewable diesel and develop/execute the testing needed.
Our NORA Research Associate, Dr. Jenny Frank, is publishing the first research paper on the NORA Net Zero home in the next month or so and she will be continuing her research on the environmental and economic benefits of our industry’s transition to lower carbon fuels. One of the key elements in this improved environmental and economic narrative is recognizing all of the key impacts as we transition our customers to new, high efficiency equipment. Utilizing NORA equipment rebates, the IRA’s $600 dollar tax credit for new equipment, this new improved efficiency coupled with the inclusion of renewable fuels, provides for a significantly improved emissions profile and the costs savings for the consumer.
Education & Outreach
NORA is also providing technical education for thousands of technicians who install and service liquid heating systems. This education is heavily focused on energy efficiency and carbon reduction. As part of our 2024 education curriculum, NORA will be providing BPI certification programs for our liquid heating industry professionals, so they can conduct the building energy audits to support the HOMES provisions of the Inflation Reduction Act of 2022. NORA is also in the process of becoming a BPI Testing Center at the NORA Research Center in Plainview, NY.
One of the first notable actions that NORA embarked on in 2024 was during the first week of February when approximately 5,600 liquid heating marketers and industry support companies received a package from NORA containing its newly produced Biodiesel Blends Quick Guide for service professionals, as well as the Bioheat® fuel FAQs for Customer Service Representatives. Following this distribution, we received inquiries from many companies requesting up to 250 additional cards per organization. To date, we have not received any negative feedback and all the responses have been positive and complimentary.
To close, no one truly knows what the future holds for the liquid heating industry over the next several decades. The home heating industry has evolved over the centuries from wood, whale oil, coal, heating oil and now we are in the process of the transition to renewable liquid heating fuels and services. NORA is working hard at trying to solve the technical barriers for us to achieve 100% liquid renewable heating in the not-so-distant future. If you have any questions regarding this topic or the other many activities at NORA, please feel free to get in touch with me at mdevine@noraweb.org.
The question we should be asking ourselves in 2024 is—Are we in the business of delivering high carbon fuels and services or are we in the business of delivering low carbon products and services? ICM
Whether the Bioheat® fuel is comprised of biodiesel or renewable diesel, rest assured it is an ultra-low carbon liquid renewable fuel. We are not talking about “what ifs” or the grandiose potential of pre-commercial technologies that might be available someday. This miracle fuel that is poised to save your industry has been developed, vetted and undergone commercialization for 20 years. Your time to transition is now.
The choice is clear: Communicate Bioheat® fuel’s benefits or fade into obscurity. The good news? You’re not alone. Industry-leading groups like Clean Fuels Alliance America, NORA and the National Energy & Fuels Institute have invested heavily in awareness of Bioheat® fuel, but the message needs amplification.
That’s where Donnie Wahlberg—prominent singer, actor and passionate advocate for sustainability—steps in. He’s shocked that such a readily available, clean-fuel option isn’t widely embraced. Why? His question echoes yours.
This article aims to ignite your communication engine, providing key points to motivate you to join the movement and educate your customers about the transformative power of Bioheat® fuel. Let’s take just 20% of the existing information known to the markets and craft a compelling message that resonates with homeowners and secures your future in the heating game. Bioheat® customers, and here’s why: Bioheat® fuel isn’t just an alternative fuel, it’s also a major business opportunity. It offers:
•Energy diversity: Bioheat® fuel offers choice and flexibility, blending seamlessly with existing heating systems. In other words, and most importantly, no costly upgrades are required.
•Operational reliability: It heats cleanly, minimizing wear and tear on your customers’ heating systems, reducing maintenance costs and unnecessary secondary no-heat calls.
•Low and no carbon: Bioheat® fuel significantly reduces greenhouse gas (GHG) emissions, aligning your business with sustainability goals and customer expectations—both of which align with policy directives to “go clean or go home.”
•Renewable and ready: Biodiesel and renewable diesel are the core of the Bioheat® fuel revolution, ensuring a sustainable future for your business and your customers’ homes, neighborhoods and beyond.
You can clearly communicate with confidence why Bioheat® fuel is the right choice for your customers, with technological review by Industry leaders and equipment manufacturers. There is also a great deal of education and outreach only a phone call away—if you wisely choose to take advantage of it. Now that you are well positioned and armed with the “why,” let’s explore the “how” of communication. Some key messages to weave into an outreach with customers, both digitally and face to face, include:
•Bioheat is a proven, readily available solution for cleaner home heating.
•It seamlessly integrates with existing heating systems, requiring minimal adjustments.
•Transitioning customers to Bioheat® fuel reduces their carbon footprint and supports a sustainable future.
•Bioheat® fuel ensures energy independence and price stability, protecting your customers from market fluctuations.
•By choosing Bioheat® fuel, your customers are aligning with environmentally conscious brands.
Beyond Words: Amplify Your Message
Effective communication extends beyond words. For the next six months, you will hear a lot from Wahlberg on what he finds so fascinating about our fuel. His authentic delivery of our message is centered on simplicity. Wahlberg stated in several of the communications we enjoyed during his debriefing that “people don’t want to be inconvenienced to evolve.” He’s absolutely right. We have to make adoption of our “new” clean fuel easy and accessible. Check—we’ve already done that. Now you, as the customer-facing conduit, have to amplify this industry messaging and take it to your clients in your own words, and most importantly with enthusiasm and authenticity. Here are some tactics to consider:
•Partner with Wahlberg: Leverage his star power to create awareness campaigns and educational materials. Reach out to your state oilheat association for more insight on strategies being implemented in your area or region and how you can leverage that information for your own social engagement with customers.
• Utilize multiple channels: Combine traditional advertising with social media, email marketing and community events. Get that keyboard on hyperdrive. When you see a post from your State trade association, another dealer or an associate promoting Bioheat® fuel, proceed to boost and share it.
• Offer incentives: Encourage early adopters with special offers and work with professional-marketing companies to help you supercharge your messaging. To many people, the product is still “new,” so it’s time to inform the customer what Bioheat® fuel means to them.
•Personalize your approach: Tailor your message to different customer segments, addressing their specific needs and concerns. When people pick a car, for instance, it’s often based on color, performance packages, brand identity and almost always affordability. Contrast the evolution from high-carbon to low- and no-carbon heating fuels. It’s a journey that Wahlberg likes to tell his Instagram followers is never-ending. You don’t have to do it all at once, but you must do something. The first step is asking your fuel dealer for it. Think about the lack of effort required for a home heating oil customer to begin the journey to a cleaner product. It is literally as simple and as easy as it gets.
•Showcase success stories: Share testimonials from satisfied Bioheat® fuel customers, which will help build trust and establish credibility. Fuel dealers with whom I engage often have no shortage of negative stories about these new renewable fuels. I suspect it’s easier to dismiss them, hoping that policy influence will recede and we can go back to selling carbon-based heating oil. That, my friends, is not happening. Bad news travels faster and further than good news. I mention this because even with a highly recognizable spokesperson on our team, we are going to have to get involved and tell this story, as well. However, without you, your influence and the trust you have established with your customers, the communication playbook is less impactful.
The Future is Bioheat® Fuel: Don’t Wait, Communicate!
The home heating oil industry is at a crossroads. Low-carbon, high-performing Bioheat® fuel offers a clear path to a sustainable future—but effective communication is essential. By sharing its benefits with confidence and leveraging impactful strategies, you can win the hearts and minds of your customers and secure your place in the evolving energy landscape. Remember, it’s not just about selling fuel; it’s about offering a cleaner, more responsible way to heat homes, protecting the environment and ensuring a brighter future for your business and community. Join the movement. Communicate Bioheat®. Together, let’s keep homes warm and our planet—along with your brand identity—cool. ICM
Carbon reduction policy is now the norm for the Northeastern States. Renewable low-carbon and zero-carbon energy sources are being aggressively pursued. Among them, solar and wind seem to get the most publicity and both provide exceptionally clean energy. In the mix of clean-energy fuels are those liquid versions that work so well and effectively in liquid fuel fired heating—primarily biodiesel (ASTM 6751). Biodiesel has been used in liquid fuel heating for close to two decades, blended with standard heating oil, and for each drip of biodiesel blended, the carbon emissions drop. Since it is still a liquid fuel, the infrastructure, delivery, storage, and management remain the same, requiring little to no modification—freeing the industry to move forward. The transition to higher blends has been ongoing during this time, and along with it, the updating of codes and standards, like ASTM and UL that ensure safe and effective operation.
The past year saw significant leaps in the heating systems available with the ability to be powered by the lowest carbon liquid heating fuel, B-100. Energy Kinetics, a boiler and integrated systems manufacturer from Lebanon, NJ, announced the 100% biodiesel blend listing for their complete line of residential and commercial heat and hot water boilers. This followed the necessary preliminary step of having B100 burners. During the past 12 months, both R. W. Beckett Corp. and Carlin Combustion Technology launched their respective lines of burners rated by UL to operate on 100% biodiesel, as well as blends of biodiesel and fuel oil. Years of collaboration with these industry partners, along with NORA’s R&D division based in Plainview, NY, enabled the development and deployment of these burners on Energy Kinetics B100 boilers.
Biodiesel is a renewable fuel that reduces greenhouse gas emissions and helps the oilheat industry meet aggressive decarbonization goals.
In addition to biodiesel and blends providing a significant evolution in the oilheat industry toward sustainability and a low-carbon future, energy savings can provide a remarkable force multiplier. The NORA Report on Equipment Upgrade Incentive Project demonstrates 25% average savings when upgrading from older boilers to systems that incorporate Energy Kinetics’ well insulated, low mass, thermal purge design strategy. For forward-looking fuel dealers that offer biodiesel blends or even B100, combined with an upgrade of their customers’ boilers, can cut carbon emissions by almost 85%—all the while significantly reducing heat and hot water costs.
According to Energy Kinetics President, Roger Marran. “Several decades of research on renewable liquid heating fuels, the advancements made with biofuels, updated UL and other standards, and many years of R&D and field testing have opened a unique and powerful pathway for remarkably clean low carbon heat and hot water systems. Introducing our line of fully compatible B100 listed boilers means that clean and reliable operation is now available for all biodiesel blends from straight oilheat through 100% biodiesel. Combined with the efficiencies gained with our boilers, emissions and fuel use are reduced even further, achieving outstanding results with even lower fuel bills.”
Energy Kinetics boiler design strategy begins at the heart of the heating system with a focus on exceptional burner combustion. This is achieved with high performance ceramic and high-temperature alloy combustion chamber designs. The company then builds a specially formulated low mass steel spiral boiler around that heart of the system. This provides near perfect combustion for clean burning operation with oilheat, natural gas, and propane, and now seamlessly integrates with new burner technology with up to 100% biodiesel (B100).
Additional technology enabling industry leading energy savings includes the Energy Manager boiler control with thermal purge—a highly effective energy recovery feature, and integration with a unique plate heat exchanger heated hot water storage tank.
The combination results in proven 30-year lifecycle boiler designs that optimize comfort, savings, serviceability, and overall performance. ICM
We have all been there, where nothing seems to be working and there’s no light at the end of the tunnel. Against all odds, you find the strength to take one more step—the resolution to persevere. Perseverance becomes an act of pure will against logic and common sense. To persevere is to keep trudging in place when any rational person might have otherwise quit, with the hope and faith of moving forward eventually, even if just a fraction of an inch.
I frequently reflect on biodiesel’s storied timeline of development. It has long been known that Rudolf Diesel ran his early namesake compression-ignition engine on peanut oil in the late 19th and early 20th centuries. By the 1930s, there was interest in splitting vegetable oils to produce a less viscous engine fuel. Moving into the 1940s, reports of what we now call “biodiesel” being used in several countries during World War II ended with wider petroleum availability after the war.
Fast-forward to the late 1980s, and a growing surplus of soybean oil in the U.S.—a result of increased soybean processing and growing demand from the animal-feed industry for soybean meal over whole beans—became a drag on soy prices and was hurting farmers and their livelihood. A movement started to find potentially high-volume industrial uses for all this surplus soybean oil. The term “soy diesel” (stylized as SoyDiesel) was coined and took root. The first known manufacturing of soybean oil-based biodiesel in the U.S. occurred under humble beginnings in Kansas City, MO, in 1991.
In 1992, the National SoyDiesel Development Board was formed by the Missouri Soybean Merchandising Council to find greater use for mounting stocks of this byproduct from soybean processing, as low-volume markets such as salad dressing and mayonnaise were not enough to put a dent in the huge volumes amassing in storage tanks across the Midwest. Two short years later, that group evolved into the National Biodiesel Board and for the next decade and a half, a Wild West-like period of rapid growth in biodiesel development and eventual commercial production ensued, transforming the energy landscape in interesting ways.
Between these time frames, R.W. Beckett completed lab tests of biodiesel blends in an oil burner. Just this year, Beckett commercially released its UL-listed B100 burners and fuel pumps. The move from early lab tests on low-level biodiesel blends to selling UL-approved B100 burners and pumps is enormous progress. Such headway can only be made through perseverance. Editors note: Carlin Combustion Technology announced the release of B100 burners as this issue went to press.
In 2002, the fuel-quality standard ASTM D6751 was published. This was the beginning of nearly two dozen revisions as biodiesel quality evolved from compromised in its early days to exceptional and ratable today, again leveraging the perseverance of scientists and Industry leaders willing to deliver a cleaner-burning liquid fuel to the marketplace. In 2008, the heating-oil specification ASTM D396 allowed up to 5% biodiesel (B5) in conventional heating oil; in 2015, this was expanded to include B6-B20 fuel grades. The industry was evolving, and quickly.
I would be remiss not to mention that the Bioheat® fuel vision was established in 2003, first conceived in my basement and further developed thanks to important collaboration with colleagues and backing from the National Biodiesel Board (now Clean Fuels Alliance America), as well as national and State soybean boards. In 2006, the registered trademark for Bioheat® fuel was secured and since has adopted Plus and Super Plus in order to reference higher and higher blend levels.
Jumping ahead, our industry convened in 2019 and unanimously agreed to voluntarily commit to decarbonize so that a brighter and more secure future could be realized. That commitment—the Providence Resolution—remains intact, and it is the perseverance of many that makes this reality the focal point of our future success.
Throughout the past 30 years, I have witnessed firsthand perseverance exemplified by many individuals and companies, all working together to keep a seat at the 21st Century energy-supply table. Saying this endeavor has been challenging, frustrating and often fatiguing would be an understatement of epic proportions. Would it have been an easier journey if the thousands of companies that make up the oilheat nation joined readily with the early visionaries? Certainly. This, however, was not the case.
Even today, 20+ years in, just a small percentage of fuel dealers actually blend biodiesel into their home heating oil offering. The good news is that this minority of dealers makes up the industry’s largest volume. Hopefully, in the next year or so, with our continued perseverance, the pendulum will swing and it will be all for one and one for all.
Just writing about perseverance helps me keep motivated, focused and hopeful that our most recent endeavor to share the Bioheat® fuel value proposition with consumers will be what’s needed to turn heads and get this movement the attention it deserves after persisting for two decades.
Six months ago, Clean Fuels asked if we could take a different trajectory to help heating-oil nation tell this great story. Even the most committed Bioheat® fuel dealers are at times reticent to talk about the new and improved fuel for a multitude of reasons only they themselves can share. Reflecting on the past decade of our product-development investments to promote Bioheat® fuel, I thought about where we had been first.
Collectively, Clean Fuels members and the National Oilheat Research Alliance (NORA) have invested millions of dollars in education, consumer outreach and technical improvements in both the fuel itself and the equipment in which the fuel is stored, delivered and consumed. Bioheat® Playbooks, websites, print and digital materials, outdoor media campaigns, radio, television, billboards, conferences, sponsorships, branding, consumer-focus groups and much more were developed and disseminated over the years. The missing link with these investments remains a dealer who is “ready, willing and able” to back up the brand with honest face-to-face communication with their customers. That is what ultimately cements the relationship and what the consumer will adopt, because of the trust they have in their supplier.
Now what? After all these concerted efforts with incommensurable results, how can we truly begin to make a real difference? We have a 21st Century low-carbon fuel, the most technologically advanced, modern equipment to combust it in and OEM acceptance on many levels. Our leadership is driving change politically but our capital deficiency to invest in messaging simply comes up short.
Enter “the influencer”
An influencer is an individual with the power to affect buying habits and decision-making of consumers due to their expertise and relationship with their audience. They have a large social media following and create content that generates significant engagement. Through a collaborative effort between Clean Fuels and a notable influencer-resource group, we have entered into an agreement to secure an influencer that we feel best represents our brand—one that has the authenticity and fan base to share the Bioheat® fuel advantages we all know and love.
The journey to identify and select that individual was well planned, thoughtful and deliberate. Starting soon you will hear a lot from this influential person who, after several encounters with our team, gets it and loves it.
Our plan is to work with this individual and engage the consumer population through a well-defined and thought-out paid digital media campaign. To date, several energy groups from Massachusetts, Connecticut, Rhode Island, New York and Pennsylvania are considering joining our collaboration to invest their funds for exclusive use in their States as we prepare to embed our value-added story directly to the consumer. The themes remain constant: energy diversity, operational superiority, no transition costs and the freedom of consumers to choose what energy source they will rely upon to provide themselves and their family’s home comfort.
When sharing the Bioheat® fuel story with our influencer, it became clear to me and those on my team that they exemplify perseverance. They’re not the type of person who gives up. They value our story and understand we are working hard to protect our family businesses and the industry at large.
Ultimately, with this influencer program, we will unleash all the successes we have amassed over the past two decades and bring the story to the customer. My recommendation to you, the average heating oil dealer, is to be prepared to follow up. An existing or future customer of yours may be calling to ask, “Do you sell Bioheat® fuel?” What will your response be? ICM
To survive in this era of climate-focused policy, the oilheat sector must decarbonize for the industry and its thousands of multigenerational family-owned businesses. Widespread adoption of higher blends of Bioheat® fuel, such as 50% (B50) biodiesel and eventually B100, is the only viable way for heating oil to achieve the carbon reductions needed to stay competitive in the race toward net zero.
However, before this can happen, a great deal of work is needed to prove B50 and B100 Bioheat® fuels are fit for purpose. Furthermore, standards-development organizations such as Underwriters Laboratories (UL) and ASTM International, as well as equipment manufacturers like R.W. Beckett Corp. and Carlin Combustion Technologies, must approve the use of these higher blends under existing or modified fuel specifications and product warranties
The behind-the-scenes negotiations, testing, field trials and demonstrations required to accomplish all this is nothing short of exhaustive. Spearheading this tremendous body of work is a joint effort between longtime collaborators Clean Fuels Alliance America (formerly National Biodiesel Board) and the NORA.
“That collaboration is absolutely critical,” said Scott Fenwick, Technical Director of Clean Fuels. “Without it, we wouldn’t be where we are today. The willingness to partner and work together to solve any technical issues that might exist is very important.”
The same exhaustive efforts were undertaken over the years—decades, really—beginning in the 1990s to approve biodiesel use in on-road diesel vehicles, which culminated in the first ASTM D6751 biodiesel specification in the early 2000s. From there, a series of additional modifications to the standard, as well as approving blends up to B20 in on-road diesel fuel (ASTM D7467) and within the ASTM D396 heating oil spec ensued, all of which required extensive testing and data gathering. Today, however, B50 is the new B20 and shortcuts cannot be taken when proving a fuel is fit for purpose when one misstep can cause oilheat furnaces to shut down in subzero temperatures.
Tom Butcher, Director of Technical Research at NORA, noted that the working relationship between Clean Fuels and NORA is tremendously valuable.
“Their support in the work we’ve done, especially the field work, is really important in helping us push higher Bioheat® fuel blends, understanding what the challenges are and getting over those issues before these fuels can be broadly used,” Butcher said.
“There is also a great benefit from the exchange of information. We share perspectives from different viewpoints. Clean Fuels sees issues from a fuel perspective while NORA views them from an equipment perspective. There is huge value in being able to go back and forth on technical matters and discussing whether it’s a fuel or equipment question. We have the same end goals, but we approach them from different angles.”
Some of the most recent work resulting from this invaluable collaboration has led to important breakthroughs that ultimately will facilitate market acceptance of B50 blends of Bioheat® fuel and, eventually, B100.
Cold-flow Study
It is no secret that both petroleum fuel oil and biodiesel have issues in cold weather.
“One of the challenges we face as we go to higher Bioheat® fuel blends is cold flow,” Butcher said.
“Biodiesel can gel at significantly higher temperatures than petroleum diesel.”
Biodiesel made from soybean oil hits its cloud point at a lower temperature than biodiesel produced from animal fat, for example, so this function is highly dependent on feedstock.
Although most heating-oil consumers in the Northeast have tanks inside their basements sheltered from the severe winter weather, some are located outside. Considerations must be given to other points in the supply chain before the fuel gets to the end user, including distributors’ storage tanks and fuel-delivery trucks.
NORA and Clean Fuels have been investigating options to address cold-flow issues with higher blends of Bioheat® fuel for some time, Butcher said, including tank heaters and more. However, one particular approach holds significant promise, according to those involved.
“We’ve been working on the development of a new additive package that can dramatically improve the cold-flow properties of a B50 blend,” Butcher explained. In addition to Clean Fuels and NORA, the work is being performed in partnership with Advanced Fuel Solutions and Clariant; the effort began in early 2021.
As part of the project, Clariant dove into its vast portfolio of additive products to match different technologies together and rated them. After innumerable combinations of products were tested on B50 blends of Bioheat® fuel, “mix No. 5” was chosen, according to Paul Nazzaro, President of Advanced Fuel Solutions (AFS) and longtime supply-chain liaison for Clean Fuels. Nazzaro said the new B50 additive includes three active ingredients: a wax anti-settling agent (WASA), a cold-flow improver (CFI) and a synergist. The WASA keeps wax formations that are caused by fuel gelling suspended for up to 96 hours, while the CFI restructures the wax, preventing it from growing into large plates that can block lines or filters. Finally, the synergist is a specialty polymer designed to improve the performance of the base components. The additive package developed enhances the flowability of B50, improving the pour point but not the cloud point. According to Nazzaro, the trio of additives is most effective on B50 blends containing soybean oil-based biodiesel and, to a degree, biodiesel made from used cooking oil (UCO).
“This technology markedly improves blends up to B50, but they have to contain biodiesel from soybean oil or UCO—preferably soy because it’s easier to treat,” Nazzaro explained.
“This new technology is exciting, but it’s not an effective tool on B50 blends containing animal-fat biodiesel.”
After rigorous lab tests, Nazzaro said the additive package is now being introduced to the real world for field trials. Companies such as Cubby Oil and Hart Home Comfort are working with select customers over the next few months to test the new B50 additive technology in their oilheat systems. Every nuance is being extensively documented.
“Our work so far shows this can dramatically reduce the pour-point temperature to well below zero, which has the potential to make it much easier to handle these fuels,” Butcher said.
Nazzaro said that while mix No. 5 may not be “the” solution, it is definitely part of it. “The best defense is to be water-free, and if you have water in your system, eliminate it,” he said.
“This additive package will give B50 Bioheat® fuel a fighting chance so
that, in cold conditions, the product will flow. This will take cooperation from users and sellers to do their due diligence and make sure the environment where the fuel is stored is properly taken care of. If not, no additive on the planet will succeed. Fuel is a breeding ground for everything. Based on our lab results, this new technology shows promise to protect systems that store B50 in outside tanks. However, like I said, it is feedstock-specific,” Nazzaro added.
Cold-flow additives for biodiesel blends have traditionally only worked on the petroleum side of the fuel blend. However, as the oilheat industry moves toward greater decarbonization and leverages B100 to achieve this, new approaches must be developed to improve cold flow in the biodiesel itself.
“This is a novel technology and as we work toward higher blends, which will have less petroleum fuel in them, we need to come up with new technologies to provide the cold-flow performance needed,” Fenwick said.
“While we have focused on B50 additives for the past two years, we have already begun early work on addressing B100 cold flow.”
Although much time has been spent focusing on outdoor residential tanks, Butcher asked, “What about the rest of the whole logistics system? Trucks set out overnight in terminals and terminals may not have heated tanks or lines. Then there are the lines on delivery trucks. As we go to higher and higher blends, we need to think about all of these things. However, this additive approach gives us a really interesting tool to manage challenges as we go forward.”
Standards
Late last year, an update was officially made to UL 296, the standard developed by UL for safety testing liquid-fuel-fired burners. The update expanded the standard’s scope to include liquid-fuel-fired burners intended for use with Bioheat® fuel blends ranging from B20 to B100. Prior to the update, the standard included procedures for evaluation of burners for use with biodiesel blends up to B20.
The updated standard was a huge victory for Bioheat® fuel and the movement to decarbonize heating oil.
“Representatives of the burner manufacturers, Clean Fuels—Scott Fenwick and Steve Howell—I and others were very active on the UL committee and we worked with UL staff on all the questions that came up about this whole approach,” Butcher said.
“I’ve got to give credit to UL, who realized the strong interest that the heating-oil industry has in moving to these higher blends. I think they were very practical about putting this together with short wait times. The test procedures that were developed were debated quite a bit among the technical folks involved. Each brought data to justify points and we worked collaboratively across the board to develop a procedure we were happy with.”
Butcher also pointed out several items in the procedure that the committee did well and made good decisions about.
“One is to have a test procedure that requires testing with B100 and testing with B20, and not having to test at intermediate levels along the way,” he said.
“If the [equipment] can perform well at these bookend points, then it can pass the test. I think that was a really good approach.”
Another important aspect was defining B100 using the ASTM D6751 standard. While D6751 is the ASTM fuel-quality standard for B100, it wasn’t originally intended for use as a neat fuel but instead as blendstock.
“That was one of the key decisions that enabled this UL 296 update to go forward,” Butcher explained.
“Since there isn’t a D396 (heating oil) B100 spec, and by using the D6751 blendstock spec for B100, this enabled the committee to go forward with the work and UL to develop the procedure rather than waiting for changes to ASTM D396, which could take a long time. That was a very important accomplishment. Materials can be so varied, and it’s hard to make sweeping statements about classes of materials. Instead, advice was provided regarding materials to avoid. If a manufacturer wants to use a certain material, then it’s got to be tested rather than UL categorically dismissing broad types of materials”, he explained.
Another part of the UL 296 procedure that Butcher said is “a cool idea” is testing the burner setup adjusted for use with B100 per the manufacturer’s specifications and then suddenly changing the fuel to B0, or fuel oil with no bio-content. The system still must perform well and pass the combustion-flow tests and other parameters.
“This is a thoughtful and useful approach that—as different users may find themselves needing to switch from high to low blends and back—ensures things will be okay in the field as they make fuel changes,” Butcher said.
“The hard work of the committee to debate and sort this all out really helped make that happen.”
Shortly after the UL 296 standard was officially updated, R.W. Beckett Corp. made a major announcement in January 2023. CEO & President Kevin Beckett announced at the Clean Fuels Conference that the company is manufacturing the first production run of oilheat burners with B100-compliant components, and that the B100-compliant burners will come with the company’s full warranty. This important move wouldn’t have been possible without the groundbreaking update to UL 296. Other burner manufacturers are working to also be able to release burners for high blends of Bioheat® fuel in the near future.
“In all of the work that’s been going on for the past several decades, this was just the next dot we’re connecting to work toward B100 as a replacement for petroleum heating oil,” Fenwick said.
“The recent announcement late last year on new protocols for UL 296 was crucial. Clean Fuels, NORA and equipment manufacturers all worked together cooperatively to develop these new protocols. It meant the creation of a B100 developmental spec, as well ,that we could use for these fuels to test new equipment, he noted”
The developmental spec, also referred to as an industry spec or trade-association spec, leveraged ASTM D6751 but added three more hours to the oxidative reserve, totaling six hours instead of three in Rancimat testing for measuring shelf life; this was to account for the extra time fuel may sit in storage tanks in Summer when heating systems are not in use.
“Changing the oxidative reserve makes a lot of sense to me,” Butcher said, adding that in order to make changes to ASTM D396, however, fuel producers, end users and others have to weigh in.
“I know changing the oxidative reserve is on the table, but we have to see where the whole committee comes out on this. Folks are going to want to see data as to why changes like this need to be made. We’ve already got a lot of that data, but to change an ASTM spec is a long process. In the end, we hope to get a really good standard that will serve everyone for a really long time. Meanwhile, it’s a very good thing that UL 296 moved forward to enable manufacturers to put products out there for use with high blends. The ASTM spec on fuel properties will come along in due time, but it’s not holding up the forward motion at the present time. For the long run, however, we really need D396 to have higher blends. Dealers and consumers can sell and use them based on that UL listing, and equipment manufacturers can make and sell products. When you look at the larger scene—building codes, municipalities, State governments—they will all feel more comfortable requiring higher blends to be used, or supporting and using the blends themselves, if it is in D396 and that step is done. We all realize that this isn’t over. We’ve got to get the changes in D396 in order to encourage broad use of the fuel,” Butcher added.
Net-Zero Home
To demonstrate B100 Bioheat® fuel’s effectiveness at carbon reductions, Butcher is using his own house in Port Jefferson, NY, to prove B100, coupled with solar panels, can bring a home to net zero carbon emissions.
The idea is to demonstrate how NORA’s zero-carbon home can achieve carbon reductions by using existing heating systems and commercially available solar-panel systems.
“For me, it’s just a great idea to be able to become 100% net zero carbon and I’m thrilled by the whole thing,” Butcher said.
“The use of B100 biodiesel has been really without concern at my house,” he explained.
“In addition to solar—and I love the fact that my utility bill is $15 a month for electricity—it really works. It was installed in July [2022] and it’s now the end of January [2023], and it’s pretty clear I’ll overproduce electricity for the year, making more electricity than I can use, which is exported to the grid” , he further explained.
Butcher shared that when he and his wife made the decision to invest in solar panels, they looked at the cost projections and payback period of 6.5 years, which appear to be on track.
“We are pretty thrilled that, between biodiesel and solar, we can say we’re net zero without having to invest in a lot of heating equipment, such as heat pumps,” he said, pointing out that incentives to install solar panels are even better now than when they made the decision.
“It just makes so much sense; the one thing that bothers me is that more folks aren’t doing it,” Butcher said.
Others have expressed interest in similarly outfitting their houses, Butcher added. State energy organizations are leading the charge for recruiting more demonstration sites, and NORA will help alleviate some costs associated with additional projects.
“We really want to have these out there as great examples of how to get to net zero with fuels, and without big investment costs,” he explained.
“As we get more people to do this, it’s important for us to use this as a communication tool. It’s not just about economics or technical ability, but for this next wave of sites we want to leverage it as an instrument of communication.”
GHG Calculator
To back up claims by biodiesel advocates that their fuel can actually achieve the greenhouse-gas (GHG) emission reductions they say it can, the industry needs an effective, scientifically sound and demonstrable device that can easily show its ability to decarbonize. In fact, if a tool can show Bioheat® fuel could effectively reduce GHG emissions at a significantly lower cost than other options, then considerable headway may be made in terms of supporting technology-neutral policy pathways toward decarbonization.
Thanks to Richard Sweetser, longtime NORA consultant, this flexible, user-friendly apparatus has already been developed. It’s called the GHG calculator.
“This is incredibly important,” Butcher said.
“The idea is to look at different major pathways for the future. One is the assumption that the grid will get Greener as more renewables come onboard. Another pathway considered is the biofuel pathway, where industry converts at a variable rate. The calculator is flexible, and you have the ability to put rates at which the grid gets Greener. The calculator shows the impact of that trend in GHG emissions over time, and the amount of investment costs required to achieve a particular pathway,” he explained.
The flexibility of the calculator allows for either broad, generic assumptions or specific State-by-State bases.
“You can input the rate at which a particular State decides it also wants the option to transition to biofuels,” Butcher futher explained.
“It’s intended to make the case that the biofuel pathway really needs to be more seriously considered by States. That is the most significant potential outcome of this work.”
Fenwick said the GHG calculator will help consumers better understand the benefits that biobased diesel fuels such as biodiesel bring to the table and how well they can compete against natural gas and electric heat pumps.
“Tools like this help a fuel dealer explain exactly the benefits associated with this fuel,” Nazzaro said.
“It takes over the need to use adjectives—you just plug in the volume, and it extrapolates the amount of GHG reductions. Any time you can use a visual to explain the benefits of a product, it’s a win. To take the story one level further, it gives the consumer confidence that the decision to use Bioheat® fuel is an intelligent one,” he noted.
Future Work
In the field of approving new fuels, work never seems to be completed. There is always more to do.
“We have a never-ending list of things we want to do,” Butcher admitted.
“We want to expand the number of B100 test sites we have out there to get more data.”
Another area NORA and Clean Fuels are interested in is filtration.
“Fuel and service issues go hand in hand,” Butcher said.
“Fuel-related service issues have been the No. 1 concern of this industry for a long time, so improvements can be made in the area of filtration. We’re doing research to provide updated guidance on how better filtration can improve performance. We want to know how well we’re really doing now, how we can do better and whether there are benefits to it. We want to know, if we improve filtration, whether we will decrease the frequency of maintenance needed on the burners,” he added.
Fenwick agrees that filtration is atop the priority list.
“As combustion technologies, engines or heating-oil systems improve and advance, those advancements require cleaner and cleaner fuels,” he said. “Biodiesel is ahead of that game currently, but there are still improvements that can be made. We know water contamination in fuel is one of the largest concerns the industry has. It can come into play via degradation and contamination throughout the distribution chain, so there are certain things we can address to tighten up the entire fuel-distribution system.”
If You Prove It, Will They Use It?
The comprehensive body of work being conducted by NORA and Clean Fuels has one single purpose, according to Nazzaro, who developed the concept of biodiesel-blended heating oil more than 20 years ago. That purpose is to ensure the commercial success of Bioheat® fuel in the market.
“This fuel is being exhaustively explored,” he pointed out.
“Any impediment we saw, we have addressed accordingly and successfully. Why do all this work? Why go through all these tests and developments? We are commercially introducing this product, so all this work is needed to instill confidence in the fuel dealer who’s going to sell it to their customers. This body of work is making this product market-ready today.”
The popular catchphrase from the baseball movie Field of Dreams was, “If you build it, [they] will come.”
For Bioheat®, the question of, “If B50 and B100 Bioheat® fuels are proved and approved, will they be carried and consumed?” will hopefully be answered sooner rather than later.
“From my standpoint in the technical program, our job is to address the technical barriers that might prevent our members from selling their fuel into these markets,” Fenwick said.
“However, capitalism in the marketplace will take care of supply. Right now, California and its Low Carbon Fuel Standard is willing and able to pay more for fuels and credits for low-carbon liquid fuels such as biodiesel. As the Northeast market develops, whether through State or regional programs, we’ll see higher blends over time. Certain providers and dealers may migrate faster, leading the way for others, but I do believe it’s our job to address the technical issues and let the marketplace decide when and where higher blends are most effective,” he explained.
One of those market leaders Fenwick speaks of is Star Group LP, one of the U.S.’ largest retail distributors of home-heating oil based on sales volume. The company earned an Influence Award at the Clean Fuels Conference in January for its leadership role in the adoption and acceptance of Bioheat® fuel. After starting with B20 blends, Star Group recognized that by providing increasing levels of biodiesel, it can offer an easy and affordable solution for home heating to help meet the goal of zero-carbon emissions by 2050.
Nazzaro noted that now that many of the technical challenges for higher blends have been addressed, it’s time to focus attention on supply issues.
“To say you can’t get Bioheat® fuel is unacceptable,” he insisted.
“Have a conversation with your supplier. Tell them how many millions of gallons you as a fuel dealer provide in a year. Tell them you want to carry B20 and have them figure it out. The conversation needs to be started. Are we problem solvers or order takers? It starts with communication,” Nazzaro concluded.
Until every technical and supply question is addressed and solved, NORA and Clean Fuels will, as Fenwick said, continue connecting the dots until a clear picture of the future emerges. ICM
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
Mark Twain famously said, If you don’t like New England weather, wait a few minutes. As we enter yet another heating season, the weather is indeed changing—and so is home heating, thanks to political and regulatory directives from every facet of government. While Twain’s quote lives on, mine probably won’t endure the test of time, but here it goes: If you don’t like the New England heating-oil market, just wait—it’ll change too.
I’ve been beating the drum for years—even decades—now about how this market must be willing to future-proof itself, so much so that my hands are sore and the drum skin worn thin. A grassroots movement—such as the Bioheat® fuel revolution—starts with innovative leaders at influential companies leaping blindfolded and headfirst into unsettled waters, allowing safe diving for those behind them. That was done years ago.
Have you tested the water yet or are you still on dry, scorched land wondering where everyone went? The water’s fine and those in it are enjoying the benefits that come with the swim—namely, not languishing in the destruction of indecision.
There was a time when indecisive or complacent heating oil dealers in this market could survive, maybe even thrive, without giving two thoughts about carbon intensity, greenhouse gases (GHG) and the future of their industry. With congressional passage and President Joe Biden’s signing of the Inflation Reduction Act (IRA), those days are over.
IRA, Biofuels & Home Heating
The massive spending bill is a revived, scaled-down version of President Biden’s “Build Back Better” agenda that cleared the House late last year but got held up in the Senate over lack of support from Sen. Joe Manchin. With a new name and smaller price tag, Senate Majority Leader Chuck Schumer secured the much-needed Manchin vote in the evenly split chamber and the legislation passed on a straight party-line vote through the budget-reconciliation process, with VP Kamala Harris breaking the tie.
IRA kicks electrification of every U.S. energy sector into high gear, including home heating. The cost of conversion, which is particularly untenable for lower-income residents, is one area the heating oil industry has long felt it’s had an edge over electric heat pumps. However, IRA makes $4.275 billion available to States and $225 million available to Native U.S. Tribal Communities through Sept. 30, 2031 to create electrification-rebate programs for single-family homes and multifamily buildings. Only low-to-moderate income households are eligible for rebates under this section.
Despite its arc toward electrification, IRA also includes several key biofuel and Green-energy incentives. It extends the $1-per-gallon biodiesel blenders tax credit through 2024, which was set to expire at the end of this year. The new law also extends the 50-cent-per-gallon (cpg) alternative fuel tax credit and includes various other important incentives for the biofuels industries, including carbon capture and storage, Green hydrogen and renewable natural gas. It also includes, for the first time, a sustainable aviation fuel (SAF) tax credit, which starts in 2023 and runs through 2024, and ranges in value from $1.25 to $1.75 per gallon, based on GHG reductions.
One particular aspect of IRA that may be ringing alarm bells in downstream markets such as the heating oil sector is how a newly created clean fuel production tax credit, whose value will be based on how much GHG emissions reductions a fuel delivers, will replace the biodiesel blenders tax credit come 2025. No longer will blenders be in control of the credit, nor is it likely that the value of the producer credit will ever reach that of the blenders’ credit. For instance, today, soybean biodiesel on average reduces GHGs by 57% compared to petroleum diesel fuel. Such reductions would only net the producer 20 cpg. While this in itself is inherently concerning, SAF achieving the same GHG reductions in this so-called “technology-neutral” approach would receive 35 cpg.
In its analysis of IRA, the National Energy & Fuels Institute (NEFI) pointed out that the legislation’s drive to incorporate more biofuel into aviation will have only nominal short-term impacts on the heating and on-road transportation sectors.
“Future demand for renewable fuels and related feedstocks in the aviation sector may have longer-term implications across all sectors,” the organization stated. “NEFI is working with [the National Oilheat Research Alliance] and partners in the renewable fuels industry to assess short-term and long-term impacts, both positive and negative.”
NEFI is also skeptical that the Internal Revenue Service and Treasury Dept. will be able to establish this “complex tax incentive” by 2025, referring to the clean fuel production tax credit.
“NEFI has warned Congress that the shift from a blender to producer credit harms marketers that are investing millions of dollars in downstream biofuel blending and storage,” NEFI stated. “We alerted Northeast lawmakers that establishing a credit only for domestic biofuel production will discourage imports of biofuels from Canada and other U.S. trade partners and restrict regional fuel supplies. It is [also] possible this policy may violate World Trade Organization rules.”
Clean Fuels Alliance America stated that, for the next two years while certainty of the blenders credit exists, it will focus on regulations implementing the producer credit—and making sure all its members have fair access to it.
There is a lot to unpack here and there is more in IRA yet to cover. However, as you might expect, the transition of the biodiesel tax incentive from a blender to a producer credit, the sliding value of it, along with the need of accurate systems to fairly determine a fuel’s carbon intensity, are creating some significant unknowns downstream.
IRA also provides $500 million over 10 years for downstream biofuel-infrastructure grants, supporting the Trump-era cost-sharing grant program from the U.S. Dept. Of Agriculture (USDA) called the Higher Blends Infrastructure Incentive Program. Importantly, as amended by IRA, the Program provides “home heating oil distribution centers or equivalent entities” and biofuel-distribution systems with up to 75% in cost-sharing grants for blending, storing, supplying or distribution of biofuels. These changes were included in NEFI-backed legislation, and NEFI “strongly encourages” wholesale and retail fuel marketers to apply for these grants.
On Aug. 23, USDA opened a $100 million round of funding for these projects, specifically noting that the funds are open to home heating oil distribution centers. However, fast action is required, because grant applications are due by Nov. 21.
The infrastructure must support biodiesel blends of at least 20% and may include “installing, retrofitting or otherwise upgrading fuel dispensers or pumps and related equipment, storage tank system components, and other infrastructure” related to dispensing of biofuels. Transportation-related infrastructure that is not located on-site is excluded.
The final bill also includes crucial changes advocated for by NEFI and the Oilheat Manufacturers Association that allow an oil-fired furnace or hot-water boiler to qualify for a $600 tax credit if it’s placed into service after Dec. 31, 2022 and before Jan. 1, 2027, meets or exceeds 2021 Energy Star® efficiency criteria, and is rated by the original equipment manufacturer (OEM) for use with at least 20% biofuel blends. If the equipment is placed into service after Dec. 31, 2026, it must achieve at least 90 annual fuel utilization efficiency (AFUE) and be rated by the OEM for use with at least 50% biofuel blends.
The writing is on the wall, and the takeaway message to heating oil dealers is that survival lies in the transition to higher blends of Bioheat® fuel. This will save your business and the more businesses like yours that are saved, the more industry too can find salvation. However, this blended clean fuel won’t just fall in your lap. You have to work for it.
Securing Bioheat® Fuel in Today’s Market
I can’t tell you how many times, particularly in today’s market, that I’ve heard dealers say they would offer higher blends of Bioheat® fuel, but they can’t find the biodiesel to make it happen. Today, wholesaler tank inventories of heating oil are purposely low, sometimes just fumes, because of backwardation. If terminals and wholesalers are not bringing in more heating oil volumes than what’s committed to because inventory carried into next month will create unsustainable losses, then they’re not bringing in biodiesel either—because there’s no discretionary heating oil volumes with which to blend it on-site.
In other words, as crazy as this might sound, biodiesel supply availability is not the reason biodiesel supply is not available. What I’m trying to say here is that we must reengineer the thought process of the buy-sell agreement.
Getting B20 on demand in this market is unlikely to happen because of the reasons mentioned here. There are ways, however, to successfully secure B20—but it requires communication. You have to communicate with the wholesaler and tell them straight up, “I’m a million-gallon fuel dealer and I want to sell B20. I need this much by this date—what’s my number?”
Conversation, commitment and collaboration are needed in this new era of purchasing. I strongly encourage you to work with your chosen suppliers, whomever they might be, to open the discussion. Believe me, they want to sell product to you. With renewable diesel on the rise out West, the Northeast is a bastion for biodiesel—perhaps one of the strongest out there—but domestic biodiesel producers need to know there are those willing to commit to purchasing this low-carbon fuel from them.
We can’t control commodity values, the war in Ukraine or what the Administration does, but don’t tell me you can’t get blended fuel. You can make a deal and make it happen, but you have to be prepared to pick up the phone and make that call. This may be a different way of doing business, but it doesn’t cost a penny. ICM
Aside from harvest and Halloween, October is best known for Major League Baseball and World Series heroics. An even more anticipated event took place this October as supply-chain executives, hosted by the National Biodiesel Board (NBB), came to Boston, MA. The event discussed the challenges and opportunities associated with the creation of a ratable, efficient and competitive biodiesel supply chain designed to ensure New England and Mid-Atlantic Bioheat® fuel dealers reach the goals established within the 2019 Providence Resolution.
This resolution demands increased biodiesel content be blended into generic heating oil through 2050. Domestic biodiesel producers in attendance shared their business acumen, addressing the manufacture of sustainable, homegrown renewable fuels, while learning about “how things work” here on the ground, behind the terminal gates. The event provided both groups—fuel dealers and biodiesel refiners—the opportunity to share and learn about one another with the endgame being growth for both sectors.
Throughout the day, the basis of their discussions centered on how to strategically transport, store, blend and make available approximately 800 million gallons of biodiesel a year (mgy) throughout the Northeast and Mid-Atlantic as the 2023 deadline for Phase 1 of the resolution approaches. For those unfamiliar with the Providence Resolution, the targeted biodiesel concentrations in home heating oil and timeline by which these targets should be met are B20 by 2023, B50 by 2030 and net zero (B100) by 2050.
With the knowledge of expected demand in mind, it’s important to determine where all the biodiesel will come from. Capacities and projections shared below are based on volumes tracked by the U.S. Energy Information Administration (EIA) and reported on its website, www.eia.gov.
Currently there are approximately 75 domestic biodiesel plants strategically located throughout the nation. As reported by EIA:
• 13 plants producing 150–170 mgy are in PADD 1 (Petroleum Administration for Defense District) (East Coast)
• 37 facilities producing one billion gallons of total annual production capacity are in PADD 2 (Midwest)
• 15 biodiesel refineries manufacturing 580 mgy are located in PADD 3 (Gulf Coast); and
• 10 plants in PADD 5 (West Coast) can produce 174 mgy
PADD 4 (Rocky Mountain) biodiesel production capacity is negligible.
All in, U.S. biodiesel production capacity totals 2.4 billion gallons per year.
As good as this sounds, biodiesel production capacity in our “local” PADD I region is in short supply because the region requires 800 mgy to hit the B20 targets in the Providence Resolution by 2023 and is only capable of producing 150–170 mgy. Where could that shortfall be made up?
Imports are a natural, obvious answer, but the domestic biodiesel suppliers in attendance of the October Boston meeting made it clear they would like to be a strategic supply partner to close the gap for regional wholesale terminal operators. For that to become reality, producers will have to work to improve their supply-chain costs to be considered long-term providers of this much-needed volume.
West Coast LCFS programs
Assessing the bigger supply picture, we see that U.S. demand of both biodiesel and hydrotreated renewable diesel exceeded three billion gallons a year in 2020– 2021. Meanwhile, 4.5 billion gallons of additional annual production capacity of renewable diesel through expansions, new builds and petroleum-refinery conversions have been announced and are in the works. The Northeast should reserve celebration, however, because this new production is being minted for the West Coast to satisfy low carbon fuel standard (LCFS) programs in place in California, Oregon and Washington State.
When the term Bioheat® fuel was knocked around nearly a decade ago, there was no concern of a formidable LCFS program to strain supply in other regions. Today, there is. Policy and innovation have driven increased production of cleaner biomass-based diesel from a more diverse range of raw materials—all good for the future of low-carbon liquids in general. It’s exciting to have so many benefits to finally share with our liquid-fuel customers. Benefits that originate with Bioheat® fuel are obvious, and they can be summed up with three simple words: better, cleaner and safer.
For those seeking an expanded storyline, Bioheat® fuel:
• Positively addresses climate-change concerns;
• Is obviously sustainable;
• Provides a much-needed low carbon fuel option;
• Is a predictable greenhouse gas reduction tool;
• Delivers cleaner combustion, generating lower particulate matter to reduce cancer risk and respiratory disease
• Promotes domestic job development, energy security and can be leveraged today to sustain and grow liquid- fuel markets.
These are all great points that pique interest and promote discussions to accommodate increased availability of biodiesel throughout the regional supply chain. The conversation was not a difficult one to have. Those in attendance agreed that the competition for low-carbon biodiesel will not be fossil fuel or even renewable diesel, but rather electrification. Electrification is an energy source being irresponsibly fast-tracked by legislators unwilling to acknowledge the adverse impact their recommendations will have on the grid and the consumer, who will be forced into a fuel that requires huge capital investments and will likely come up short when performance counts.
Also, let’s not forget the challenges of going from being served by a family Bioheat® fuel dealer to a utility. Instead of human interaction and attentive customer service, get used to hearing: Please hold.
With Connecticut, Rhode Island, New York and Massachusetts all now enjoying policy incentives centered on biodiesel, and more leading fuel dealers adopting the transition to B20, it has become obvious that more focus is needed to identify and secure ratable, competitive supply while downstream wholesalers continue to prepare their assets for receipt, storage, blending and distribution to the dealer.
The benefit of the nation’s liquid home heating epicenter being situated near the water and major ports was also addressed during the summit. Regional wholesalers, who recognize that, much like heating oil, seaborne shipments of biodiesel are clearly more convenient and economical when weighed against rail or even pipeline movements, explained why imports would be relied upon to get the job done.
This was not a surprise to domestic biodiesel producers, who understand they will have to be more creative if they are to play any appreciable, long-term role in Bioheat® supply to the Northeast. This meeting was also a time for the U.S. biodiesel industry to reiterate it is not anti-imports, but rather the domestic sector stands strongly against trade practices that give foreign supply unfair advantages.
Feedstocks: staying neutral
Another misconception addressed at the gathering in Boston was that, contrary to some beliefs, the NBB is not all about soy. Of course, soybean oil is a feedstock that remains the primary source of U.S. biodiesel production, but the organization is feedstock neutral—and it needs to be. No single feedstock can be relied upon to establish a legitimate industry long-term.
According to EIA data, 54% of all biodiesel introduced into the U.S. market in 2020 was manufactured from soybean oil, 14% from distillers corn oil, 13% from used cooking oil, 12% from animal fats and 7% from canola. This exemplifies how the industry, and the trade association that represents it, are feedstock neutral. In order to meet the volume requirements necessary to replace all petroleum-derived fuel oil with bio-based liquid alternatives for the entire heating oil sector— the 2050 end-goal of the Providence Resolution—it will take all of these feedstocks, and others not on the radar today.
All in all, the event proved quite successful and valuable between the groups’ leadership. Of course, any post-event communication among those in attendance now remains confidential between those planning to play an instrumental role in ensuring future supply.
It is clear, however, that the East Coast will be comfortably supplied by both domestic and imported sources, the feedstocks will be varied, the specification consistent with ASTM D6751 parameters and the physical handling of the products on the ground in the Northeast and Mid- Atlantic will be managed as all liquids have been for decades—with the highest level of attention and professionalism to ensure the longevity of liquid fuels prevails. ICM
