Succeeding With Bioheat® Fuel

Succeeding With Bioheat® Fuel

Two New York energy marketers who sell biodiesel-blended heating oil spoke strongly in favor of the fuel during a seminar at the recent Southern New England Energy Conference.

Dennis Traina Jr., of Tragar Oil, in Wantagh, N.Y., and Raymond Hart, of Hart Home Comfort, in New Hyde Park, N.Y., both said they would rather sell their blended fuels than sell pure petroleum heating oil. They were panelists in a seminar entitled New York’s Experience with Ultra Low Sulfur Heating Oil and Bioheat. Kevin Rooney, CEO of the Oil Heat Institute of Long Island (OHILI), moderated the discussion.

Hart said he has seen a dramatic decrease in fuel-related service calls since switching to biodiesel blends in 2007. “I wonder how the hell did we ever do this before,” he told the audience. The savings that Hart Home Comfort has achieved on the service side provide a substantial offset to any price increases he has faced for the fuel, he said.

Traina shared similar observations. “I can’t imagine ever going back. Even if you gave me 10 cents on the gallon, I wouldn’t do it,” he said. “I don’t know when the last time was that I had to worry about middle-of-the-night fuel-related service calls.”

On the Leading Edge

The industry is interested in the experiences of New York marketers, because New York City and New York State have adopted fuel supply mandates ahead of other jurisdictions. In 2012, New York City began mandating a 2 percent biodiesel blend and New York State mandated a switch from traditional heating oil to ultra low sulfur heating oil (ULSHO) for dealers statewide. New York State has also supported biodiesel blends with a biodiesel tax credit that homeowners can claim on their state income tax. Most of the New England states are now in the process of switching to the cleaner fuels, and marketers are curious about the experiences of their peers in New York.

Hart Home Comfort and Tragar Oil are companies that have embraced the new fuels wholeheartedly. Ray Hart built a specialized railroad facility to bring biodiesel to New Hyde Park, and Hart Home Comfort has branded its oil as “EcoBlend.” Tragar uses the tagline “Your Green Energy Company” and refers to itself as a “Bioheat company.” “These companies are heavily invested in biofuel,” Rooney told the audience.

Hart said he sells blends up to B20 (80 percent petroleum, 20 percent biodiesel) and treats all his oil with additives. Technicians are spending less time changing filters, strainers and nozzles, and fewer than 5 percent of his company’s service calls are fuel related now, he said. “We don’t need to do as much on the service calls, and we don’t have as many callbacks,” he said. The reduction in service calls has enabled Hart’s service team to devote more time to other projects, such as building out new services.

Traina said Tragar Oil has managed to grow its customer base without expanding the service team because of the reduction in oil burner service calls. “It really is dramatic,” he said.

Rooney asked the marketers whether their cleaner fuel is costing them more to buy. Hart said there is a difference of as much as 15 cents, but it doesn’t hurt him competitively because all dealers are mandated to use ULSHO.  Hart Home Comfort also benefits from having strong control of its supply thanks to the rail supply network it uses to bring in biodiesel.

Additives Help With Quality

Rooney asked whether the marketers had encountered any cold flow problems with biodiesel blends in aboveground outdoor tanks. Hart said he uses additives to control the fuel’s cloud point and stability. He said he encountered some issues when the polar vortex descended in 2014, but Hart Home Comfort has adapted its fuel treatment regimen to account for extreme cold.

Traina said cold weather has not caused problems at Trager, but the company did encounter problems with leakage with one brand of oil burner. (The manufacturer has resolved the problem, he added.)

The Trager executive said that Bioheat marketing is a helpful development because it gives the company something positive to talk about with customers. “It’s something for people to be proud of,” he said. “This is the cleanest fuel we have ever had.”

Hart concurred: “We have a great story to tell. We have an exceptionally clean fuel and a product that is cleaner than natural gas. Why not tell customers about that?” He said the natural gas industry has worked hard to instill a negative large of heating oil in customers’ minds, and marketers “need to take a stand and talk about positive measures. We have a great opportunity to stabilize this market and potentially regrow it.”

Rooney said OHILI recently participated in a six-state consumer survey that identified Bioheat fuel as a potentially game-changing product that could serve to deter homeowners from converting to natural gas.

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