34 • OIL
&
ENERGY
Mass. Marketers Confront
State’s Pro-Gas Initiative
LIKE THEIR COLLEAGUES IN CONNECTICUT
and New York State, Massachusetts Oilheat
marketers find themselves fighting an
apparent alliance of state regulators and
utilities bent on replacing heating oil with
natural gas.
Michael Ferrante, President of the
Massachusetts Energy Marketers Associa-
tion (MEMA), said that the Department of
Energy Resources (DOER) has hired a con-
sulting firm with strong ties to the utility
industry to develop a plan for expanding
gas heat in the Commonwealth.
The plan under study by the DOER
and the consulting firm, Sussex Economic
Advisors, would convert as many as 900,000
Massachusetts customers to gas heat.
A similar plan in Connecticut is designed to
convert 300,000 homes, and utility regula-
tors in New York State are developing a plan
to convert as many as 1.1 million homes.
ACCELERATING FUEL CONVERSIONS
“We see DOER’s efforts—especially
their work to find pathways to accelerate
conversions to natural gas—as a very serious
threat to the retail heating oil industry in
Massachusetts,” Ferrante said.
Officials at the DOER have told
Ferrante that they are working to bring
the state in compliance with the Global
Warming Solutions Act that the state
enacted in 2008. That law requires the
state to reduce greenhouse gas emissions
by 25 percent from 1990 levels by 2025
and by 80 percent by 2050. As part of that
initiative, DOER has also commissioned
studies on renewable fuels such as solar,
wood and biomass.
Ferrante said the DOER seems to have
turned its back on the state’s Oilheat dealers.
“This is the same energy office that passed
the nation’s first Bioheat mandate, and now
we have biofuels as an afterthought when
they should not be,” he said. “Biofuel was
fine in 2008 and 2009, and it’s a great way
for our industry to build a renewable fuel
base. It makes you angry, because you hope
that state officials will govern and not try
to erode a particular sector of the state’s
economy.”
“Our Board of Directors has been kept
abreast of these troubling proceedings, and
given that Massachusetts is the third largest
heating oil market in the U.S., there’s plenty
at stake here, including the livelihood of
hundreds or heating oil operations and the
fate of thousands of industry employees,”
Ferrante said.
He said the natural gas plan being dis-
cussed by the DOER and Sussex Economic
Advisors is designed to change the utility
gas rate structure and spread the cost of new
gas conversions over the entire rate base.
FIGHTING BACK
The DOER has designated MEMA as a
stakeholder in the process, and the associa-
tion will file multiple reports regarding the
environmental effects of natural gas, heating
oil and wood as well as the price outlook for
natural gas and oil.
“We must intervene and provide state
officials with solid data that speaks to the
economic strength of the Oilheat industry
in the region and also counters the pervasive
view that natural gas is cleaner, environ-
mentally benign and a more cost-effective
and efficient fuel,” Ferrante added. “We
have to slow this freight train down.”
Recent government and academic
reports have highlighted problems with
natural gas, including a study commis-
sioned by U.S. Sen. Edward J. Markey
(D-Mass.) indicating that American
consumers paid at least $20 billion from
2000-2011 for gas that was unaccounted
for and never used. Ferrante said MEMA
will draw on that report, as well as reports
of extensive gas leaks by Boston University
Associate Professor Nathan Phillips and the
Conservation Law Foundation.
EXPERTS PITCH IN
MEMA is also preparing a report on
the economic benefits that the heating oil
industry provides, including thousands of
jobs. John Huber, President of the National
Oilheat Research Alliance, and Richard
Sweetser, President of Exergy Partners, are
helping to develop documentation.
MEMA is also receiving support from
Dr. Thomas Butcher, head of the Energy
Resources Division at Brookhaven National
Laboratory, who will testify about emissions
from wood burning, which are far more
harmful than Oilheat emissions. “There is a
lot of evidence that wood biomass is one of
the dirtiest fuels,” Ferrante said.
In addition to opposing the DOER’s
initiatives, MEMA is also defending Oilheat
with a fall radio advertising campaign in
conjunction with the American Energy
Coalition (AEC). “AEC is doing a great job
of keeping this message out in front of the
public,” he said.
“Our challenge now is price. No ques-
tion people like the service from Oilheat,
but what is driving people now is the eco-
nomics,” Ferrante added. “We have to find
our way around that and build a case for
Oilheat and Bioheat and focus on what we
can do on efficiency and cleanliness.”
Natural Gas Aggression
