Cleaner, Secure, Affordable Thermal Energy Act Update

A piece of legislation introduced this summer has alarmed the fuel oil industry. Senators Jeff Bingaman (D-NM) and Olympia Snowe (R-ME) say the Cleaner, Secure, Affordable Thermal Energy Act (S. 1643) would increase energy efficiency efforts nationwide. However, the key part of the measure would ‘allow a tax credit for residential energy property expenditures to convert a home heating system using oil fuel to a system using natural gas boilers and furnaces and biomass heating appliances.”

This legislation has sent organizations like the New England Fuel Institute and the Petroleum Marketers Association of America on edge. 

‘We have strong concerns with this legislation (S. 1643) that would amend the federal tax code to encourage conversions from heating oil to either natural gas ($3,500 tax credit) or wood (biomass) products such as pellets and firewood ($4,000 tax credit),” said Sherri Cabrera vice president of PMAA. ‘And we are working closely with Senator Snowe to remedy some of our concerns.”

The basis of the act is an attempt at greater energy efficiency, but Cabrera believes that it can be done with other solutions that work with the fuel oil industry’an industry that is consumer-oriented and consists mostly of small businesses.

‘Heating oil has been less expensive than natural gas overall in the past 30 years, and heating oil could be cleaner burning than natural gas as it moves toward becoming renewable in the future,” said Cabrera. ‘Already, through the application of new, high efficiency technology over three decades, average annual consumption has been reduced from 1,200 to 700 gallons ‘ a decrease of almost 40 percent.  Other solutions include stronger federal and state tax incentives for system upgrades, and greater efforts to bring even more cutting-edge and efficient heating equipment and renewable fuels to market.”


The move has left widespread confusion, as NEFI wrote in their Issues Alert posting on their Web site. ‘We are working directly with other industry trade groups and stakeholders to fully understand why this bill was introduced, who its advocates are, how much it would cost and what the desired results are.”

Cabrera said PMAA is engaged with Senator Snowe and that she is open to alternative solutions to reaching her energy efficiency goals.

‘She (Snowe) remains an advocate and champion for the National Oilheat Research Alliance (NORA) and home heating biofuels, in addition to her support for other national industry priorities, including greater transparency in the futures markets, fuel assistance programs, and measures to help small businesses in the heating oil industry,” Cabrera said. 


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