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HEAT Show 2023 a Grand Success!

The liquid fuels industry convened in Springfield, Massachusetts from June 20 to June 22, for the National Energy & Fuels Institute (NEFI) HEAT Show 2023. Close to 800 attendees filled the show floor at the MassMutual Center, meeting with vendors, attending technician and management training sessions, networking over refreshments, and enjoying every minute.

Highlights of the show included the opening Government Affairs Committee Meeting, the Legends Dinner Gala, NORA updates, training sessions on the new B100 burners from R.W. Beckett, two inspiring keynote presentations, the Industry Summit and so much more.

The HEAT Show kicked off with two important sessions: the NEFI Government Affairs Committee meeting and the Market Based Regulatory Update session, with Joe Uglietto of Diversified Energy Group providing insight on the different types of regulation, the challenges of each, and how industry members might be able to generate additional profit from some programs.

These serious sessions were followed by some much-needed celebration, as attendees changed from work and travel clothes into their finery for the Legends Gala Dinner to honor this year’s Legends: Steve Abbate (Cetane Associates), Peter Bourne (Bourne’s Energy) Scott D. MacFarlane (MacFarlane Energy), Paul J. Nazzaro, Sr., (Advanced Fuel Solutions), Edward Scott, Jr. (Scott Energy Co., Past NEFI Chair), Doug Woosnam (Cetane Associates, Woosnam Consulting, DVFDA), and Jeffrey M. Woosnam and Jeffrey S. Hammond (Star Group), while enjoying a delicious dinner of lobster and filet mignon. The evening was emceed by former legend Jim Townsend, with special appearances by NEFI Executive Director Sean Cota and NORA President Michael Devine.

Wednesday started early with a rousing keynote breakfast session on Cheer-leading, led by former women’s professional football player and corporate consultant Jan Horton Spence. This was the pep rally the audience needed, and fully energized, they moved on to a morning of Management Sessions. Techs enjoyed breakfast in the “pre-show area” and went on to earn NORA CEU credits in their training sessions. The trade show floor opened at 2 p.m. and was filled with exciting product demos, state-of-the-art trucks, a truck driving simulator, games of skill, and professional and friendly exhibitors. The trade show continued Thursday morning, and was followed by another inspiring keynote session, this time over lunch, by Betsi Bixby of Meridian Associates, who exhorted the attendees to carefully consider their company’s culture and then find employees who held the same priorities. The show ended on a positive note with the Industry Summit V.

There was a lot to cover during the Summit, with a panel discussion on the newest technologies, updates from state association leaders and discussions on marketing and messaging . Please turn to “Industry Summit V Offers Hope” on page 28.

Unfortunately, Oil & Energy reporters were unable to attend all the management sessions, but here are highlights from some of the programs in which we were lucky enough to participate.

Government Affairs Committee Meeting

Mike Estes and Kathy Erasmus, Government Affairs Committee Chair and Vice-Chair, opened the meeting, with Estes noting, “It’s been one heck of a year. People think they know better than us about getting to clean fuels. We have to fight at the state and federal level to bring some sanity into the mix.”

The state association executives and NEFI Vice President and Director of Government Affairs Jim Collura proceeded to offer updates on legislative challenges on the state and federal levels. Diane Quesnelle, Executive Director of Energy Marketers Association of Rhode Island (EMARI), noted that B10 will be the statewide standard for heating fuel as of July 1, 2023, increasing to B20 in 2025 and B50 in 2030; but at the same time, the legislature has voted to ban fossil fuels in new construction as of 2025 and was “giddy” about offshore wind turbines. Matt Cota, President of Vermont Fuel Dealers Association (VFDA) provided an update on the recently passed Clean Heat Standard that will force fuel dealers to “sell less or pay someone else to convince your customers to use less fuel.” This will require spending of approximately $2 billion to implement, with obligated parties, i.e., heating fuel companies, funding approximately $1.2 billion, equivalent to at least 70 cents per gallon,

Michael Ferrante, President of the Massachusetts Energy Marketers Association (MEMA-MA), followed, as his state has also passed a Clean Heat Standard that he described as “the most onerous program or policy directive I’ve ever seen.” The Mass. CHS requires a 3% reduction in sales per year from all fuel dealers, would only allow used cooking oil as a biodiesel feedstock, and will be creating its own carbon scoring model for propane, natural gas and heating oil. All fuel retailers will need to register with the state and report on every gallon of fuel bought and sold.

Chis Herb, President of the Connecticut Energy Marketers Association (CEMA), told a slightly different story. His members faced “hundreds of legislative bills last year,” that grew out of a challenging market, basis blowouts, tight supplies and other economic crises. Environmentalists and legislators seized upon those challenges, attacking the industry with bills on price gouging, inventories of oil- and propane-heated homes, vehicle emissions, surcharges on insurance for fossil fuel providers, cap and trade programs, bans on fossil-fueled equipment, and heat pump training. CEMA was able to get each of these initiatives killed, either at the legislative or judicial level, in large part due to an outreach program where CEMA representatives went to low-income communities to explain the real-life costs of these programs to the residents. He added that many of these issues will come up again next year, and while Connecticut may be several years behind Massachusetts and Vermont, the state is deploying actions to try to arrive at the same results.

Charlie Summers, President of Maine Energy Marketers Association (MEMA-ME); Rocco Lacertosa, CEO of New York State Energy Coalition (NYSEC); and Joe Scully, representing Energy Marketers Association of New Hampshire (EMANH) also provided updates on their respective legislative and social concerns. Leslie Anderson, President of the Propane Gas Association of New England (PGANE) reported on her associations’ efforts in conjunction with each of the heating oil associations across the region, stating that “Partnerships are more important than ever,” and noting that the recent uproar over potential bans on gas stoves was a boon to their – and our – causes.

Jim Collura and Mark Valentini, Director of Legislative Affairs for the Plumbing-Heating-Cooling Contractors Association (PHCC) followed with information on federal policies, specifically tax credits and rebates in the Inflation Reduction Act, heat pump manufacturing grants under the Defense Production Act, and the new proposal by the U.S. Environmental Protection Agency (EPA) to eliminate all non-electric heat pump equipment from the ENERGY STAR® program, including all oil, natural gas or propane fueled boilers and furnaces.

NORA Updates / “In the Loop” – New Business & Education Opportunities from NORA

NORA’s Dr. Jenny Frank, Research Associate, and Dr. Tom Butcher, Director of Research, presented a fascinating look at renewable liquid heating fuels and their efficacy in reducing carbon emissions. Dr. Frank explained her research quantifying and comparing the environmental and financial impacts of residential heating fuels and technology from Ultra-Low Sulfur Diesel, B100 Bioheat® fuel, natural gas and air-source heat pumps in New York state. Her study reviewed fuel/electricity costs, installation and maintenance; cumulative emissions of CO2e, the carbon cycle and lasting impacts of all emissions; the energy and fuel use for each system and its life span; and the social cost of carbon, utilizing federal or state values for energy and installation costs, social carbon costs, and efficiency standards. New York’s clean energy grid was a large contributor to the finding that heat pumps produced the most positive results, she noted, adding that similar analysis in regions with less green energy generation would have different results. Homes utilizing B100 had the second-best results. The mathematical formulas developed for this study could be easily modified to consider the electrical power generation, annual temperatures and energy costs for other regions.

Dr. Butcher updated the audience on the work he is doing in the NORA laboratory on indoor and outdoor emissions with biodiesel and other renewable fuels. He also provided an update on the research around NORA’s NET-0 home. Several times throughout the HEAT Show, Dr. Butcher was asked about equipment function with biofuels. The advances in B100 biodiesel fuel and the organic materials that are used to create it have affected the filtration in our burners in a significant way. This has become a focus in NORA’s ongoing research in biodiesel fuel, to which Dr. Butcher said, simply, “Our filtration needs to get better.” He also repeatedly noted the need to use a one-pipe system and replace filters more frequently.

Following Dr. Butcher’s updates on the studies from his team at the NORA labs, Michael Devine took the podium to discuss the new podcast from NORA, In the Loop. The podcast was created in part to help get NORA’s message out into the world, that the solution to decarbonization already exists, and it is biodiesel blended heating fuels. Devine summed his thoughts up by elegantly stating, “We have an amazing story to tell, and we’re not really good at telling it.” Thus, In the Loop was created to bring the people who have helped pave the way for a net-zero carbon future to the forefront to share their stories.

Growth Strategies for the Family-Owned Business

Kendal Rawls, Rawls Group, and Fred Lord, Cetane Associates, took on the sensitive issue of succession in a family business. Their session started by asking the audience, most of whom were in a family-owned business, to determine the “why” of their business growth plan. Were they growing to provide more services to the community, to build a stronger business to pass on to their family, or to eventually sell? They stressed the importance of running a family business like a corporation, with formal, written descriptions for each employee’s position - especially for family members. For family businesses with minority shareholders and extended family in various positions, these agreements and descriptions could soothe hurt feelings, provide a path to harmonious business operations, and make the transition, whether sale or succession, smoother.

One of the most important recommendations was the importance of developing family governance policies, separating “family” from “business.” This can include setting out specific requirements for family members to be employed, such as earning a high school diploma or equivalent, going to trade school or having a good employment record elsewhere. Family governance should also include performance metrics, reporting hierarchies, and accountability for all parties. For an inside look at multigenerational businesses, see “Scripting a Successful Succession” on page 24.

RFS, RINS and the State of the Industry

Several months ago, when the HEAT Show schedule was developed, no one could predict that the EPA would release its final rule on the Renewable Fuel Standard (RFS) on Wednesday, June 20, less than 24 hours before Chevron Renewable Energy Group presented “RFS, RINS and the State of the Industry.” This confluence made the Chevron Renewable Energy Group’s session one of the best attended of the show.

NEFI’s Jim Collura introduced the session and outlined the new EPA ruling: modest increases in renewable fuel blending requirements, the removal of the proposed elimination of RIN separation above 20 percent blends, and the retention of the current biodiesel RIN value of 2.5 RINs per gallon. These were all issues, Collura explained, that would have increased fuel costs and created an economic barrier to the production, sale and use of higher blends of Bioheat® fuel. NEFI, Chevron Renewable Energy Group and their industry partners’ advocacy and the approximately 550 letters sent to the EPA in response to NEFI’s industry-wide call to action were widely credited for these changes in the final rule.

Jason Lawrence, Senior Business Executive, Chevron Renewable Energy Group, provided a much-needed lesson on the Renewable Fuel Standard. The RFS was developed under the Bush administration in 2007 to increase the use of biofuels in the transportation sector, reduce dependence on foreign oil, and reduce greenhouse gas emissions. Its goal, set in 2007, was to reach 36 billion gallons of renewable fuels per year. That goal has not yet been met.

Curtis Powers, Chevron Renewable Energy Group’s Manager of Compliance, SEM, was the analyst who originally identified the limit on RINs separation in the original EPA proposal. He helped the audience understand how Renewable Identification Numbers are the “currency of compliance” for the RFS, and simplified the steps by which RINs are generated, traded and retired to prove compliance. He further explained that RINs could be sold with the fuel gallons to which they were assigned, or separated, so that the fuel could be sold to a non-obligated party, such as a renewable liquid heating fuel wholesaler or retailer, and the separated RINs sold to a non-renewable fuel producer or importer obliged under the RFS. The separation and sale of RINs offset the cost of biodiesel used for Bioheat® blends.

Season of Growth: Summer Marketing for Stronger Year-Round Business

David Heiser of PriMedia offered insight into summer marketing for liquid fuels retailers. Especially in light of recent price volatility and electrification incentives, implementing programs to reach consumers year-round with strategic messages, advertising campaigns, and customer communications is necessary for consistent growth.

Heiser reviewed the pros and cons of digital campaigns and traditional print, broadcast and out-of-home channels; as well as the use of integrated or “smart” televisions, programmatic targeting, and weekly community news outlets to communicate with consumers in your service base.

He also explained how using your company’s first-party data can enhance your customer marketing as well as create similar audiences on digital platforms. (For more insight on his presentation, see “There is No Off-Season” in the June 2023 issue.)

Technician Training Sessions

The technicians at the HEAT Show had their days filled with training sessions led by some of the best minds in the industry and earned NORA CEU credits for each program they attended. These included:

How to Select the Perfect Replacement Circulator without Doing the Math! by David Holdorf, Taco Comfort Solutions
Kerosene Alternatives for Cold Flow Protection, by Leo Verruso, Advanced Fuel Solutions
Binding Pumps and Other Sticky Situations, by Bob O’Brien, NORA
Low Voltage Wiring, Bob O’Brien, NORA
Beckett’s Tank-to-Flame: System Solutions for Tomorrow’s Fuels Today! by Alan Wornham, R.W. Beckett
Lights-Controls-App ACTION, Diagnostics Made Easy, by Jeff Rozga, R.W. Beckett
NORA Advanced Tank, by John Levey, NORA

After two-and-a-half very full days and nights, HEAT Show 2023 came to a close. Collura summed it up best, sharing, “the spirit of innovation and passion on display this week gives me great hope for our future. As discussed during the summit, our future as an industry lies in higher efficiencies, renewable heating fuels, and maintaining the exceptional service our businesses are known for. Let’s not forget that our strength lies in our ability to adapt, innovate, and persevere. Together, we can overcome any obstacle, no matter how insurmountable it may seem. Stay strong, keep striving, and remember – we’re in this together.”