Bioheat: the ongoing market share war

October 12, 2011

BY Ron Kotrba

The Northeast Bioheat Workshop took place yesterday, and the group of panelists was a Who’s Who in biodiesel-blended heating oil. A reoccurring theme throughout the one-day event was the battle between oilheat and natural gas. Despite natural gas being marketed as cleaner and domestic, the fact remains that it is a fossil fuel, a finite source of energy—one that consists largely of highly potent greenhouse gases.

Michael Ferrante, president of the Massachusetts Oilheat Council, played a radio spot during his presentation that exemplifies the seriousness of the home heating market war going on between natural gas and oilheat. The ad he said was largely accurate but it hit a sensitive nerve with the heating oil crowd. This, however, is why the oilheat industry needs biodiesel—to compete with natural gas on environmental and efficiency bases—and by and large, the biodiesel industry needs the heating oil market to grow.   

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John Huber, NORA president, said, “Each time it gets harder and harder to get hydrocarbons out of the ground. Methane is one of the world’s worst greenhouse gases, but the natural gas industry ignores that.” And despite all of the new natural gas shale deposits recently found, when it’s all said and done, that abundance of fossil fuel from that finding will be gone in 30 years.

And while natural gas is taking market share from the oilheat industry, on the other side of the spectrum, wood and wood pellets are encroaching on market share as well. And while wood is renewable, there are items such as particulate matter and transportation costs (Btus per truckload, etc.) to consider.

At a B12 level and higher mixed with ULSD, Bioheat can begin to outperform natural gas on all fronts. But to get there, a great body of work is underway (particularly at Penn State University, a study that is in its second year) to determine what is the legacy safe level. Victor Turk with R.W. Beckett Corp. said a big driver in this legacy-safe level study is the fact that 6.5 to 7 million oilheat furnaces exist in residential homes, and expecting those to be replaced to allow use of Bioheat blends greater than 5 percent is unrealistic.  

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Removal of sulfur in addition to incorporating higher blends of biodiesel is a major part of becoming cleaner than natural gas. Tom Butcher from Brookhaven National Lab said 99 percent of the sulfur exits the flue as SO2, while 1 percent remains in the system as sulfuric acid and corrodes the heat exchangers. Carcinogenic particulate matter, not carbonaceous particulates however, are from sulfur as well—sulfate particulates. Removal of sulfur from the petroleum component, and addition of zero-sulfur biodiesel, will eliminate this issue.

And after ASTM approves higher Bioheat blends, that is no guarantee that there will be market acceptance. Therefore, leveraging the wealth of field experience as well as continued education and marketing—such as the huge New York City campaign Michael Devine spoke of, which will include radio spots, bus wraps and much more identifying Bioheat as the Evolution of Oilheat—are critical components and will be for years to come. 

 

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