The Future of Home Heating

The Industry

• Stationary Liquid Fuels Industry • • We are: • – ~6,000 dealers nationwide • – ~8 million homes/Principally in Northeast • – ~7,000,000,000 gallons of fuel annually

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• National Organization Established by Congress in 2000

• A Check-off Program • Responsible for Consumer Education,

Research and Development and Education and Training

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Aggressively move forward

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50%

60%

70%

80%

90%

100%

110%

2010 2020 2030

Re

du

ctio

n i

n C

arb

on

Fo

otp

rin

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Baseline

10% Reduction

20% Reduction

30%Reduction

40% Reduction

50%Reduction

Fleet replacement by 2030 of all furnaces and boilers from70% to 96% efficiency applying ULS fuel and new condensing technology

Solar thermal hot water heating Impact

B2 first generation biodiesel

B5 first generation biodiesel

B10 first generation biodiesel

B15first generation biodiesel

Second generation biodiesel impact

Which Fuel for the Future

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Bad PM 2.5 emissions Questionable CO2 benefits Lowest heating efficiency

High capital cost Large Space requirement

Lifestyle changes required

Solid Fuel/Wood or Pellets

ULS equal to NG in PM 2.5 emissions B10 equal to NG in CO2e emissions High heating efficiency Lowest oil for oil replacement cost Ideal for high bio fraction future Best for existing oil customer value

Advanced Liquid Fuel

PM 2.5 emissions same as ULS CO2e emissions same as B10

High heating efficiency Costly replacement for oil system

Shale gas vs FRAC Act? Best for existing gas customer value

Infrastructure Issues

Clean Natural Gas Fuel

Northeast’s Distillate Supply Infrastructure

Gulf Coast via Pipeline to Linden, NJ

Refineries in Phila. and NJ

Direct Imports and Redistribution

Via truck from Canada

Via tanker from Canada, Venez., VI,

[And “Other”]

Refineries

Ref

Ref

Large ports and distribution points Other ports of entry Regional pipelines

0

50

100

150

200

250

300

350

400

450

0

500

1,000

1,500

2,000

2,500

Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09

Cen

ts p

er G

allo

n

Thou

sand

s of

bpd

PADD 1 Middle Distillate DemandHigh Sulfur Diesel

ULSD

Heating Oil

PADD 1 Wholesale Heating Oil Price

8

Source: EIA

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Governing Organizations

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ASTM Underwriters Laboratory

Local Building Codes

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Conclusion

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Questions