2008/06/24 ENE to Testify before U.S. Senate on Heating Oil Crisis Press

Press Advisory 
June 24, 2008
 
Contact: 
Meg Wilcox, 617-742-0064 617-319-6457 (cell)
Michael Stoddard 207-712-2577 (cell)

Environment Northeast (ENE) Deputy Director, Michael Stoddard, to Testify Before the U.S. Senate Committee on Small Business and Entrepreneurship on Coping with Heating Oil Costs

With the Northeast reeling over escalating heating oil prices, ENE deputy director Michael Stoddard will testify on Wednesday, June 25 before the United States Committee on Small Business and Entrepreneurship at a public hearing entitled "Examining Solutions to Cope with the Rise in Home Heating Oil Prices."  For details: http://sbc.senate.gov/hearings/
 
ENE will propose a major infusion of investment in energy efficiency programs for customers who heat their businesses and homes with fuel oil, kerosene, or propane to help them gain control over escalating heating costs.  The proposed initiative contains two components:

For business and residential buildings, new market-based, state-supervised efficiency programs that would mirror current electric and natural gas programs; the program would require a national budget of around $1 billion annually.


For income-eligible residences, an expansion of the Weatherization Assistance Program budget to $3 billion per year over five years to fund weatherization of every home receiving LIHEAP fuel aid, with expanded LIHEAP funding to assist customers over the next few years.

"Our proposal will save individual consumers thousands of dollars, while keeping billions in our local economy and creating new 'green' jobs for heating technicians and insulation contractors," said Stoddard.  "Keeping those billions at home rather than sending them overseas to purchase foreign oil is a big step towards energy independence."
 
"Offering consumers financial assistance to help them pay soaring heating bills is a necessary step during this crisis, but it is a solution with no exit strategy," continued Stoddard.  "By helping consumers use energy more efficiently we can create a more effective, lasting result that will lighten the load for both customers and the government." 
 
ENE's full written testimony will be available on its Web site on June 25, 2008 at http://www.env-ne.org
 
 
Background on the Heating Oil Crisis and the Energy Efficiency Solution
 
Heavily dependent on heating oil, the Northeast states are in a crisis over soaring prices, which have tripled since 2001. Though summer has barely begun, already consumers and oil distributors throughout the region are worried about the coming winter. 
 
In Maine, where 80 percent of consumers use oil for heat, the average resident will spend about $4,700 this winter to heat their home, based on the current price of $4.70 a gallon.  Smaller distributors are concerned about staying afloat as their margins have not increased and demand for fuel has moderated. In recent years, there have been cases where local oil distributors have collapsed, leaving hundreds of pre-paid customers with no delivery or refund, plus the need to buy heating oil a second time.
 
The hidden costs of the heating oil crisis are staggering, with $11 billion leaving the eastern U.S. states each year to purchase petroleum based heating fuels and combustion of these fuels producing approximately 140 million tons annually of the global warming pollutant carbon dioxide.
 
Consumers of electricity and natural gas have long benefited from efficiency programs, with savings as great as $4 for every $1 invested. Programs for users of petroleum-based fuels like heating oil, propane, and kerosene have lagged, however, because the distributors of these energy sources are not regulated.  It is time to bring parity to the millions of consumers who heat their homes and businesses with these fuels. 
 
Approaches to increasing heating oil efficiency would be very similar to those used for improving efficiency for natural gas customers.  Natural gas utilities have been running successful efficiency programs for decades that yield savings of $3-4 for every dollar invested and can cost-effectively reduce energy consumption by as much as 20 percent for residences and close to 10 percent for commercial buildings.
 
These natural gas efficiency programs cost far less than what it would cost to provide new energy supply. The Massachusetts Keyspan efficiency program, for example, costs about $0.25 per Therm to save a unit of energy, while the cost of natural gas supply is $1.1 per Therm, or four times more.
 
"It's time to create lasting solutions to the home heating crisis and provide efficiency services to all fuel users in a coordinated manner with the existing electric and natural gas programs," said Stoddard. "ENE will continue to work at the state and federal level to advocate for expanded funding and improved efficiency programs for all customers."

ENE is a regional nonprofit research and advocacy organization addressing climate change, clean energy policy, and other environmental challenges in the Northeast and eastern Canada, with offices in  Maine, Connecticut, Massachusetts, Rhode Island, and Prince Edward Island, Canada.