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Oil in the Family

As director of the energy division at Power Concepts, I hear a lot of rumors. About three years ago, a super at a building in Westchester mentioned to me, almost as an afterthought, that No. 6 heating oil “was about to be banned.” He couldn’t tell me how he knew, but I took it seriously enough to do some follow-up research – and found nothing.

And yet, as you read this, New York City is planning to severely restrict the use of No. 4 and No. 6 fuel oil in the five boroughs. New York City’s Department of Environmental Protection (DEP) has proposed a new rule that would, according to a public hearing notice issued earlier this year, “prohibit the use of fuel oil grade Nos. 4 and 6 in heat and hot water boilers and burners in the five boroughs.” The rule was discussed at a public hearing on February 28th and, according to Mercedes Padilla, a spokeswoman for the DEP, the comments from that session are currently being evaluated. Once that review is completed – in mid- to late spring, Padilla predicts – and if there are no “substantial changes,” the city will publish the rule and 30 days later, it will become effective.

Much of the impetus for this restriction appears to be a report written by the Environmental Defense Fund that labeled these fuels “dirty oil” and blamed them for contributing a highly disproportionate share of certain types of air pollution in New York City. I don’t want to debate the wisdom of the restrictions – personally I think one reason that No. 4 and No. 6 have such a bad reputation is that the equipment that burns them is often improperly tuned – but given that the restrictions are virtually a fait accompli, I would like to discuss what you might want to do about them.

 

Step One – Don’t Panic

I’m concerned that a lot of buildings are going to be stampeded into spending big bucks on some sort of burner or fuel conversion, and that would be a shame, because it could result in a lot of poor decisions. You have several options, and you have a fair amount of time to think about which one to choose. And perhaps more important, whatever you decide to do, you may be able to do it in stages over a few years.

This is the essence of the proposed changes, as reported by the city government in a press statement: “Effective immediately, any newly installed boilers will be required to only burn low sulfur No. 2 oil, natural gas, or the equivalent from an emissions standpoint... All boilers will be required to switch from No. 6 oil to the new low sulfur No. 4 heating oil by 2015, or to an equivalent cleaner fuel. It is estimated that converting a boiler that typically burns No. 6 oil to one that can accommodate low sulfur No. 4 oil will cost roughly $10,000... Existing boilers that have not been replaced by 2030 must be modified to meet the equivalent emissions of burning low sulfur No. 2 oil or natural gas.”

As you can see, there is no big rush (unless you are installing a new boiler). You have until 2015 to switch from No. 6 to No. 4, and until 2030 to switch from No. 4 to No. 2. Or, of course, you can switch to gas.

Does this mean you should wait until the deadline? Of course not. But it does mean you can spend some time figuring out what is the best approach for your building. Let’s look at the options.

 

Options for No. 6 Oil Users

• Convert to No. 4 Oil. As your annual burner tune-up approaches, use up as much of the No. 6 oil as remains in your oil tank as possible (without sucking the sludge at the bottom of the tank into the burner), clean out the tank (this is optional), disable the sidearm oil preheater, and start using No. 4 oil. During the annual burner tune-up, adjust the settings to burn No. 4 oil as cleanly and efficiently as possible. A few minor changes may be needed to the oil pump and the oil lines. Despite what the city’s press statement says, it will not necessarily cost $10,000 to convert a No. 6 burner to No. 4 operation. Depending on the final form of the regulations, it may not cost much at all.

 

• Convert to Dual-Fuel. Use up the No. 6 oil and clean the tank as above, start using No. 2 oil, and convert to gas/oil (“interruptible gas” or “dual-fuel”) operation. Depending on the type of burner you have now, this could cost tens of thousands or even hundreds of thousands of dollars.

 

• Convert to Gas-Only. Use up the No. 6 oil as above, decommission the oil tank according to regulations, and convert to gas-only (“firm gas”) operation. Again, depending on the burner you now have, the cost will vary, but will probably be substantial.

 

Options for No. 4 Oil Users

• Convert to No. 2 Oil. Follow the same sequence as for converting from No. 6 to No. 4, except that there will be no need to disable a sidearm preheater (because there won’t be one). Use up as much of the No. 4 oil remaining in your oil tank as possible (again, without sucking up the sludge), clean out the tank, and start using No. 2 oil. During the annual burner tune-up, adjust the settings to burn No. 2 oil as cleanly and efficiently as possible, which, by the way, is quite clean and quite efficient. It should cost less to convert a No. 4 burner to No. 2 operation than a No. 6 burner to No. 4 operation.

 

• Convert to Dual-Fuel. Follow the same sequence as for converting from No. 6 to dual fuel. Again, use up the No. 4 oil and clean the tank as above, start using No 2 oil, and convert to gas/oil operation. Depending on the type of burner you have now and several other factors, this could cost a lot of money.

 

• Convert to Gas-Only. As above with No. 6 oil, use up the No. 4 oil as above, decommission the tank according to regulations, and convert to firm gas operation. Again, depending on the burner you now have, the cost will vary, but will be substantial.

 

What Type of Burner Do You Have?

An astoundingly large proportion of heavy oil burners in the New York City metropolitan area are manufactured by one company – Industrial Combustion – so I will show illustrations of one of those burners (but the basic principle applies to any manufacturer’s burner). The most critical difference among burners, if you are considering converting to either firm or interruptible gas, is this: can my existing burner burn gas?

Notice I ask can the burner burn gas, not does it. Because if you are lucky, your burner has the ability to burn gas even if it has never done so. How can you tell? You might be able to tell from the model number – the letter “G” in the model number is usually a dead giveaway – but so many of these burners’ nameplates have been painted over or removed that it’s better to just pay a visit to the boiler room and take a look at the burner itself. As you can see from the photos, it is fairly easy to tell the difference.

Why is this important? Because if your burner already is gas-capable, there’s a strong likelihood you will not need a new burner, which will save you tens of thousands of dollars. If your burner is not gas-capable, you must install a new burner if you decide to convert to gas or dual-fuel operation.

 

Weighing the Options

Each approach outlined above has pros and cons, which are summarized in the table on page 22. Clients tell me that if the building wishes to switch to firm gas, Con Edison has frequently indicated a willingness to extend a new gas line to any building now burning heavy oil. To my knowledge, Con Edison has not made a similar offer regarding interruptible gas. This should not be surprising – anyone who switches to firm gas is unlikely ever to switch back to oil, whereas interruptible customers can switch to oil and sometimes do, even when Con Ed doesn’t require it.

You may have read that gas is now much less expensive than oil, or that it is projected to be less expensive than oil for years to come, or something equally rosy. It is true that, at the moment, most gas is less expensive than most oil (depending on whose data you use, you can make an argument either way). Will it always be that way? It’s hard for me to believe that it will be – there’s not much historical precedent for it, and in the many years I’ve been in this industry, prices have rarely moved in a predictable way.

 

If You Are Considering a New Boiler

Not often mentioned in the whole “dirty oil” debate is that the issue becomes moot if your boiler is not big enough to burn No. 4 or No. 6 oil. Since a large fraction (in my experience, virtually all) of the boilers in New York City are quite oversized, many buildings could sidestep a lot of the decision-making by installing a smaller boiler than the one they currently have.

Yes, the proposed regulations generally forbid new boilers from using heavy oil, but most buildings that plan to install a new boiler will simply install the same size as before. What if I told you your new boiler could be half the capacity of the old one, and still meet all the loads? You’ll have to wait for a future issue of Habitat to learn the details.

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