Heating Oil Industry launches Plan to Shift to 100% renewable fuels by 2050

September 24, 2020 |

“Biofuels proven as most affordable, immediate path to net-zero carbon,” says NEFI.

In Washington, representatives from the National Energy & Fuels Institute (NEFI) and global management consulting firm Kearney announced a plan for the heating oil industry to eliminate fossil energy use by 2050. This will in effect transform the very nature of heating oil, making it a renewable fuel, the group said.

In September 2019, we reported that the Northeastern US heating oil industry resolved to achieve net-zero carbon dioxide (CO2) emissions by 2050. The industry’s resolution calls for a 15% reduction in CO2 emissions by 2023, a 40% reduction by 2030, and net-zero-carbon emissions by 2050. The resolution also directs industry associations and other groups assembled at the meeting to work with each other to achieve these emissions reductions.

The Market Impact

The Northeast heating oil industry delivers renewable liquid heating fuel to more than 5 million homes and businesses across the region — 80% of the national heating oil market. The average retail heating oil company is a multi-generation family-owned and -operated business with a median of 25 employees.

The announcement builds upon a pledge made last year when more than 300 heating oil industry professionals committed to achieve 15% carbon reductions by 2023, 40% reductions by 2030 and net-zero by 2050. To reach these ambitious goals, the industry now plans to deliver a blend of 20% biofuel by 2023, 50% by 2030, and 100% renewable fuel by 2050, thereby completely eliminating fossil energy from its primary product.

In the weeks and months ahead, NEFI will continue engaging business leaders, policymakers and climate activists regarding the industry’s revolutionary plan to eliminate fossil fuel and carbon emissions from the home energy sector.

NEFI is a non-partisan, nonprofit trade association that has served liquid heating fuel providers since 1942. Kearney is a global management consulting partnership active in more than 40 countries.

The Backstory

In June 2019, we reported that research from OFTEC supports liquid biofuels as a low cost, highest impact carbon reduction solution for oil heated homes. The six-month study used a detailed analysis of oil heated housing stock in England to help inform extensive modeling that compares biofuels with other low carbon heating options available today. The study found that biofuels, both a 100% pure biofuel and a 30% blend of FAME and kerosene, provide the best carbon reducing routes for the least financial outlay.

In July 2019, we reported that OFTEC Ireland called on the government to look at decarbonizing heat oil rather than looking at expensive technologies that will require investment to switch out boilers or by quadrupling the carbon tax in an effort to reduce carbon emissions, both of which it says could send families further into energy poverty. Off-grid, rural and other around the country, about 40% of Irish homes, use liquid-fueled boilers which could be more economically served by biofuels with the additional expense of replacement technologies.

In May 2019, Renewable Energy Group and Broco Oil Company announced a partnership to provide cleaner fuel options to heating oil dealers in the Northeast. The companies are working together to provide a state-of-the-art blending facility in Haverhill, MA. The partnership between REG and Broco is an agreement to provide Bioheat®* from the Haverhill location. Terminal upgrades will include rail improvements as well as infrastructure to allow for blending opportunities at the loading rack.

In February 2019, we reported that Massachusetts awarded five grants totaling $2,889,285 to Massachusetts businesses to fund infrastructure projects to increase the availability of low-carbon, renewable heating fuels. The grants, funded by the Massachusetts Department of Energy Resources (DOER), are part of the Renewable Thermal Infrastructure Grant Program, an initiative focused on expanding the availability of renewable thermal technologies in Massachusetts.

Back in 2016, the mayor of New York City signed into law the bill that requires increasingly higher blends of biodiesel in heating oil over the next 18 years. Despite some environmental groups opposing the plan, the bill passed 47-3 in a city council vote. The blend would go to B5 next October, rising to 10% in 2025 and reaching 20% in 2034. The National Biodiesel Board says going to B5 will save emissions equivalent to removing 45,000 cars from the road while 20% will equate to more than a million cars.

Reaction from the stakeholders

“Months of research conducted by Kearney demonstrates that heating oil-biofuel blending provides the most cost-effective and immediate path for NEFI members and their customers to reduce fossil energy use and carbon emissions,” said Neal Walters, a partner at Kearney. “Our findings show that this strategy is both affordable and easier to implement than electrification for home heating in the Northeast.”

“Last year, industry leaders announced a goal that many thought unachievable,” said NEFI President & CEO Sean Cota. “Today, we are excited to announce that not only is our goal achievable, but it is also well within reach. Renewable liquid heating fuel can reduce fossil energy use and carbon emissions faster and more cost-effectively than electric heat pumps or natural gas. Who would have thought your town’s little family heating oil business would play such a big role in helping to solve the planet’s climate crisis,” Cota said.

More on NEFI here.

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