The deadline is almost here. On October 1, a new city law goes into effect mandating that the minimum biofuel content in every gallon of residential heating oil must rise from 2 to 5 percent. By bumping their biofuel content to 6 percent or more, co-op and condo boards can get a tax credit equal to one cent per percentage point of biofuel per gallon. Thus, 10,000 gallons of heating oil with the minimum 6 percent biofuel content will net a $600 tax credit; the same shipment with the maximum 20 percent biofuel content will get a $2,000 credit.
“A lot of people are still not aware of the tax credit,” says Paul DeSimone, an account executive with United Metro Energy, a heating oil supplier. “And some people are still a little apprehensive about biofuel. They think it’s snake oil, that it’s going to hurt their machines. It will actually clean your equipment as you use it, and it doesn’t contain sulfur, which contributes to acid rain.”
Most biofuel currently made in the U.S. is derived from soybean oil, and when burned with fossil fuels it reduces climate-altering carbon emissions, according to a 2014 report by the nonprofit New York Public Interest Research Group Fund. A 2016 survey by the National Oilheat Research Alliance found that heating systems did not experience problems from burning oil with a higher biofuel content. And biofuel’s cleansing effect leads to greater efficiency in heating systems.
Since New York State does not have any biofuel processing plants, much of the biofuel used in the city is delivered from the Midwest, says Chris Donnellan, a sales manager at United Metro Energy. That may change soon. United Metro is taking steps to build a biofuel processing plant in Greenpoint, Brooklyn. In addition to using soybean oil, United Metro is planning to collect used cooking oil from city restaurants, which would then be turned into biofuel.
Although biofuel blends of up to 20 percent are now available, customers have tended to stick to lower percentages, says DeSimone, of United Metro. “It’s hard to change perceptions,” he says. “People automatically think you need to spend money on system upgrades, but that’s not the case. I tell my boards that if they’re apprehensive, they should start at B6, see how the equipment likes it. Then go to B10. Then to B20. I have a building on Central Park West that uses 80,000 gallons of oil a year. At B20, that’s a $16,000 credit. That’s real money.”
A document, also known as an NDA or confidentiality agreement, designed to protect proprietary information. The authority to demand a non-disclosure agreement was granted to co-op and condo boards in two recent court rulings (see page 42) as a way to prevent the dispersal of sensitive information.