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Tuesday, June 18, 2024

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Industry Summit V Offers Hope


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Liquid Fuels Industry Leaders Look to the Future

The Industry Summit has historically been the crowning event of the HEAT Show, and Industry Summit V did not disappoint.

The Summit was split into three sections: a review of the advances in technology, equipment and fuels; a summary from state leaders on the challenges and opportunities they are facing on a local level; and marketing and messaging strategies to take the industry to the future. With so much to cover, Sean Cota, President of the National Energy & Fuels Institute (NEFI), spoke briefly before introducing the Summit’s moderator, Charlie Uglietto, President of Cubby Energy.

Uglietto noted that we were facing a moment of transformation “driven by the widespread acceptance of renewable liquid heating fuels and the government’s push to ‘electrify everything’ that will reshape the whole fuel sector in the Northeast.” He recalled the transformation of the industry after the Providence Resolution, and the current need to meet the challenges ahead by educating, incentivizing and mobilizing customers to share their concerns over the rush to electrification with regulators and legislators. With a nod to the Summit sponsors and participants, Uglietto introduced Michael Devine as moderator of the panel discussion on “Technical Advancements and the Industry’s Embrace of Renewable Liquid Heating Fuels.”


Technological Advancements and the Industry’s Embrace of RLHF:

Standardizing B100
This panel discussion was led by NORA President Michael Devine, and featured Kevin Beckett, President of R.W. Becket; Rich Lyons, President of C. Cowles/Carlin; Roger Marran, President of Energy Kinetics; and Dr. Tom Butcher, Director of Research, NORA.

Both Beckett and Lyons stated that their companies, after getting B20 burners on the market, did not see a reason to move past that point in stages, and so determined to go directly to a B100 compatible burner.

B100-rated equipment will eventually replace all previous models, Beckett and Lyons agreed, as all burners produced in the near future will be B100 compatible. On June 20, 2023, R.W Beckett announced that its new UL Certified B100 burners were ready to ship. “We intend to standardize all the components. Whether you want it or not, you’ll be getting B100 boilers and furnaces,” Beckett said.

Lyons agreed, saying, “once we go to B100, there’s no B20. That’s our burner. You’ll be able to burn anything from B0 to B100, and it will be out later this year”

With this, Marran was asked what the new burner ratings mean to manufacturers such as Energy Kinetics. “We have to make sure our boilers run reliably, and the UL certification gives us a level of confidence that we can take a burner that’s certified and make a boiler that can work in the field.”

Be Bold
Butcher responded to that, saying “We are in an exciting time. This is not a sudden reaction to political or cultural pressure; this is something a lot of us have been working toward for a long time. We’re standing on the success and hard work that has already been done. Other fuels trying to move into alternative biofuels of all kinds are behind the curve.”

Asked about renewable diesel (RD), Butcher noted that “a diversity of fuel supplies is critical. One thing we’ve learned is how to learn: how to approach new fuels.” NORA is currently researching RD in-lab. Beckett, Lyons and Marran all stated that their equipment had tested well and could run on RD.

Looking to the near-term, Devine asked the panel about replacement parts for existing boilers and furnaces, which might not be upgraded for another 20 or 30 years. Once again, all members were in agreement.

“Once the B100 burner is launched, we will have the ability and equipment to upgrade any burner in the field to B100. No one else can go into a house and radically reduce the carbon footprint by making minor upgrades. It’s not costing thousands of dollars, it’s hundreds,” Lyons said.

“We’ve got a unique opportunity to prepare the install base for the future. Stock your truck and warehouse with B100 components, - not as an initiative, but as a standard practice; as standard parts fail, upgrade. We need the market signal to standardize to B100.” Beckett stated.

One of the most critical issues, the panelists agreed, was educating consumers. It was noted that while most equipment sold today is rated for B20 fuels, and they were promoting equipment for B100, most of the industry was “stuck” at B5, and only 28 percent of fuel dealers were selling and promoting biofuels, most of whom were in attendance at the summit.

Retailers who were considering moving to B50 or higher blends were advised to contact NORA and the manufacturers for guidance and best practices; install good filtration systems and move from two pipe to single pipe systems. Most of all, Butcher told them to “be bold.”


Policy Updates

The Moment is Here
“We know that both on the fuel side and the appliance side we are ready to, and are already providing, low-carbon liquid fuels that can immediately, and I emphasize immediately, provide carbon reductions in the thermal heat sector,” said Steve Dodge, Director of State Regulatory Affairs at Clean Fuels, as he opened the Policy Updates portion of the Summit.

“Yet, in many cases, we are being left at the altar because regulators and legislators believe that ALL combustion is bad, that our low-carbon alternatives contribute to food shortages, or that the continued use of low-carbon liquid fuel perpetuates, quote ‘fossil fuel infrastructure,’ and the solution is … fill in the blank … electricity,” he continued.

Joe Uglietto of Diversified Energy Services followed, providing a brief recap of his presentation earlier in the week, explaining Clean Heat Standards and Low Carbon Fuel Standards (LCFS), cap and trade, and the like. With biofuel blends, there are more opportunities for the industry under LCFS-type programs, by delivering fuels that produce fewer emissions. As most Clean Heat Standards are euphemisms for “electrify everything,” they pose the greatest threats.

State association leaders then took the stage, briefly outlining the threats and potential opportunities in their region.

• Matt Cota, President, Vermont Fuel Dealers Association (VFDA), reminded the audience that the Clean Heat Standard had been enacted in his state, which will, eventually, impose fees to anyone selling fossil fuels and providing credits to those who reduced energy use. Over the next 18 months, regulators and legislators will be developing the final plan. During that time, lawsuits and rising costs for electrification and electric power could potentially derail the program. But, he said, “The moment is here. In Vermont, if we’re going to survive, we need to move to a lower carbon fuel today.”

• Michael Ferrante, President, Massachusetts Energy Marketers Association (MEMA-MA), spoke of his state’s new Clean Heat Standard, saying, “they are not going to make the program agnostic. They are going to favor electricity. Everything we’ve heard, they’re not going to help us. They’re going to limit feedstock. They’re going to mandate reducing your client base.” However, he believed that many leading policy makers were unaware of the anti-liquid fuel stance of the CHS. MEMA-MA was getting the message out with its statewide radio campaign.

• Rocco Lacertosa, Chief Executive Officer, New York State Energy Coalition CEO, started by commenting that “we’ve come a long way,” with our equipment and fuels, and “the environmentalists should be putting their arms around us.” He discussed the new statewide Bioheat® fuel standard as well as the ban on fossil fuel heating in new construction and the proposed cap-and-invest plans. He also noted that the phase-out of #4 fuel oil was moved from a 2030 end date to 2027. “New York faces a never-ending stream of insurmountable challenges to our industry,” he concluded, “but, with the talent in the room, we will prevail. All of us together know more than any one of us.”

• Charlie Summers, Maine Energy Marketers Association (MEMA-ME), has been working to get an Energy Choice bill passed, after polling proved that 87% of registered voters did not want government to regulate how they heated their homes. The bill received a unanimous vote in committee, but after much political machinations, was eventually defeated in both the House and Senate. Summers said, “we are able to take the information that nine out of 10 voters disagreed with that decision, and we will take it into the next voting cycle.” He then exhorted the others in the room to, “go and make a difference in this fight. We have the answer. We have to – not tell our elected leaders they are wrong – we need to give them another way to be right.”

• Chris Herb, President, Connecticut Energy Marketers Association (CEMA), described the “unholy trinity” of environmentalists, utilities and regulators.” He recapped the industry’s survival and success over the natural gas expansions over several decades. “This [electrification] is another attempt for government to pick winners and lowers. Government hasn’t learned the lesson of the resiliency of this industry.

• Diane Quesnelle, Executive Director, Energy Marketers Association of Rhode Island (EMARI), started by touting her state’s biofuel mandate. As of July 1, 2023, all heating fuel will contain 10 percent biodiesel (B10). But, beginning in 2025, no new construction can be built using liquid heating fuels. Quesnelle was optimistic about the future, noting that Rhode Island’s press releases on wind and solar initiatives talk about their “potential” impacts. She agreed that there is a lot of potential … in the liquid fuels arena, and she and her association members will be getting the clean biofuels message into the public domain. She ended with a rallying cry, saying, “I hear my mother saying, ‘you get more bees with honey than vinegar.’ We’re going to need some kick-ass honey!”

• Jim Collura, VP and Director of Government Affairs, NEFI, closed the section with the observation that, “the fights in the states have come to Washington,” Collura observed. However, with the challenges the RLHF industry has faced over the years, and the accomplishments in spite of, or because of, those challenges, he had reason to be hopeful. He provided updates on the administration’s release of the volume obligations for the Renewable Fuel Standard and NEFI’s two responses to the
ENERGY STAR proposal to remove all non-electric heat pump heating or cooling systems from the program: one on behalf of the renewable liquid heating fuel industry, and the unprecedented joint response, signed by NEFI, the National Propane Gas Association, the American Gas Association, Plumbing-Heating-Cooling Contractors Association, Energy Marketers of America, and Oilheat Manufacturers Association, putting forth the need for fuel-neutral policies that deliver the most cost-effective solutions for all Americans to enjoy the benefits of higher equipment efficiencies and renewable fuel options. He concluded by reminding the audience of the importance of supporting their associations at their state houses, and supporting NEFI to be their voice in Washington, and provided a QR code for everyone to immediately respond to the ENERGY STAR proposal.


On Media and Marketing

CFAA’s Historic Financial Commitment to the Industry
When Paul Nazzaro, President of Advanced Fuel Solutions rose to speak on behalf of Clean Fuel Alliance America, it was already well past the scheduled end time of 6:30 p.m. As such, he kept his remarks relatively brief. Nazzaro provided an overview of the $10 million in marketing and messaging that Clean Fuels (formally National Biodiesel Board) had invested for the “evolution of Oilheat.” As they look toward their next campaign, they are looking for something different, he said, adding that “the most powerful communication tool is the fuel dealer, who can speak to customers about energy diversity, operation performance and freedom of choice.” He then noted that there are more than 5,000 fuel dealers in the country, and only about 70 were represented at the summit. “They should be here. This should be standing room only. One company can’t do it alone. Everyone needs to be involved.”


Closing Remarks

Charlie Uglietto officially closed Summit V, briefly thanking the participants, panelists and sponsors, and sent the audience home with these parting thoughts: “We have the fuel, the equipment and the leadership. Today I feel great. We break our butts every day for our customers. Four years ago we made a commitment. Today we have B100 burners; we have NORA looking at all types of alternative liquid fuels, and we have state associations and NEFI working on our behalf. We’ll be there waiting with our low carbon solution, and we will be successful and prosperous.

Government Policy
HEAT Show
July 2023
Industry Summit

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