Page 30 - Oil and Energy-February 2013

30 • OIL&ENERGY
AEC, NEFI Rally
Support in Face
of Government
Initiatives
NEW ENGLAND FUEL INSTITUTE (NEFI),
the American Energy Coalition (AEC) and
other Oilheat associations are rallying mar-
keters to challenge government initiatives
in several states to promote fuel conversions
from heating oil to natural gas.
“In the past year, the heating oil industry
has seen an all-out assault on its future by
state and federal policymakers with a bias
towards natural gas that is simply based on
the current price advantage,” NEFI CEO
and President Michael C. Trunzo wrote in
an industry alert. Connecticut, Maine, New
York State and Pennsylvania are all pushing
pro-natural gas policies.
AEC is monitoring the proposals and
developing a response strategy. “Oilheat is
under attack by state governments trying to
use their legislative and regulatory oversight
powers to advantage natural gas utilities to
convert oil-heated homes to natural gas,”
AEC wrote in a recent industry alert. “These
proposals are on a fast track in CT and NYS,
and they threaten the Oilheat Industry like
nothing before, and your help is needed.”
NEFI and AEC are both working with
Oilheat marketers to mount organized
opposition to the pro-natural gas initiatives,
“Associations representing the home heating
oil industry from Pennsylvania to Maine
are rallying together to push back against
these assaults and are working to educate
lawmakers and regulators on the positive
impact of the heating oil industry on our local
economies and communities,” NEFI wrote.
MAINE TARGETS OIL DEPENDENCE
NEFI reports that Maine Gov. Paul
LePage led the way in 2011 with a proposal
to convert 80 percent of oil-heated homes to
natural gas. “Right now, 80 percent of our
homes are heated with oil,” LePage said in
a 2011 speech. “I’d like to lower heating oil
from 80 percent to about 40 percent.” He is
using sate resources to support the extension
of natural has distribution in the state.
In Vermont, gas utility Gaz Metro has
been granted ratepayer funding to build a new
gas line in Chittenden and Addison counties.
The Vermont Fuel Dealers Association has
protested the ratepayer funding as an unfair
advantage for the utility. Vermont is also
considering a tax on heating oil that would
help pay for oil-to-gas heat conversions.
Connecticut jumped into the fuel con-
version fray in 2012 when Gov. Dannel P.
Malloy proposed a new state energy plan
that would switch hundreds of thousands
of homes to natural gas using state tax dol-
lars or ratepayer dollars to fund the conver-
sions. Malloy proposes to convert 300,000
oil-heated Connecticut homes to natural gas
and expand the natural gas infrastructure in
the state with more than 900 miles of new
natural gas pipelines.
“Calling natural gas ‘cleaner, cheaper
and more reliable,’ this overreach by state
government ignores many important facts,
the least of which is the fact that the cur-
rent gas distribution system in the state has
been neglected for years and is currently
in a state of disrepair,” AEC wrote. “With
leaks that are harmful to the environment
and threaten the safety of all state residents,
utilities need to fix their existing infrastruc-
ture before expanding it, and neither should
be done with taxpayer money.”
The Connecticut Energy Marketers
Association (CEMA) is executing an aggres-
sive campaign to defeat Malloy’s plan, but
the outcome remained uncertain as Oil &
Energy went to press.
NY AND PA JUMP IN
“Now the states of New York and
Pennsylvania are discussing similar pro-
posals to convert millions of homeowners
and have an apparent partnership with
natural gas utilities to expedite the proposed
plans,” Trunzo wrote. “NEFI is aiding
state-level industry groups and [AEC] to
push back against these proposals, which
threaten thousands of small business and
hardworking Americans across the region.”
New York State’s Public Service
Commission has identified 550,000 homes
that are within 100 feet of a gas pipeline
but do not heat with gas and an additional
580,000 homes beyond 100 feet of a pipeline
but within a utility’s franchise area, bringing
the total targeted oil-heated homes to over
1.1 million, according to AEC. “The gas
infrastructure in New York State has also
been neglected for years and is in a similar
state of disrepair,” AEC wrote. “It too needs
to be repaired and upgraded before any
thought is given to extending it.”
Pennsylvania has also indicated that
they plan a similar move, although they are
not currently as far along as CT and NY,
according to AEC.
Ironically, states are pursuing these
pro-natural gas initiatives at a time when the
gas utilities are struggling to meet demand.
During last month’s cold spell, National Grid
and Consolidated Edison both instructed
their interruptible customers to stop burning
natural gas and begin burning oil. “So these
utilities that are colluding with states to help
them steal oilheat customers, do not have
the capacity to supply their current cus-
tomer base when the outdoor temperature
drops below 22 degrees,” AEC noted. “What
will they do when they have 300,000 more
customers on line in Connecticut and 1.1
million more in New York State?”
NEFI and the Massachusetts Oilheat
Council (MOC) are also challenging a
regional report by New England Council
(NEC) that claims switching customers
from heating oil to natural gas will help the
region’s economic growth. “NEFI and MOC
raised objections and wrote letters to NEC
strongly noting their concerns with the
study as not fully recognizing the positive
economic impact the oilheat industry has on
the region for businesses and employment;
the negative impact of fuel switching on
those businesses and employees; and not to
mention a policy position that goes against
the safe, reliable home heating choice mil-
lions of customers who chose and rely on
heating oil,” NEFI wrote.
Oilheat vs. Natural Gas