I normally write about issues that are not being addressed in my view, but today I find that having already taken the time to download data, the Bloomberg Administration is already proposing what I was about to suggest. Ah well, might as well write the post anyway because my justifications are in addition to the Mayor’s.
Residents of the Northeast might think they have a reason to be smug about rising oil prices, since a relatively large share of them use mass transit or walk to work, and those who drive tend to do so for shorter distances. But the Northeast leads the nation in another form of oil dependence – on heating oil. As shown in the attached spreadsheet, the states where the highest share of homes use heating oil are along the Atlantic Coast, with the percentage falling from 75.6% in Maine to 7.1% in North Carolina as one travels from north to south. New York City and the rest of New York State are in the middle of this pack at 35.2% and 30.4%. The U.S. average is just 7.3%. Therefore, Northeastern homes share with U.S. drivers elsewhere the economic and national security vulnerabilities of dependence on foreign oil.
In addition to economic concerns, oil heat causes more pollution than gas heat, though perhaps less than electric heat using electricity produced using coal (common in the South). According to this source, “residential, commercial and institutional heating systems release 50% more fine particulate matter (PM2.5) and 17 times more SO2 than cars and trucks on New York City’s roads.” There are a variety of grades of heating oil, with lower grade oils having lower costs but causing more pollution. Some New York City buildings burn sludge.
So why hasn’t oil heat been phased out, like coal heat? One reason may be the character of the heating oil dealer industry, which employed 1,387 to 1,486 people in New York City in 2008 according to County Business Patterns data from the Census Bureau. Unlike the large gas utility companies, the heating oil dealers are the kind of small businesses that Americans like to root for. Their average payroll per worker was $54,684 in New York City in 2008, compared with an average of $29,774 for all retail trade. The field requires the white collar smarts to hedge in the futures market so customers can lock in their oil prices for the winter, and the blue collar toughness to deliver heating oil in the worst conditions. One of my memories of each of the city’s recent blizzards is oil trucks trying to get through the teeth of the storm to make emergency deliveries, showing the dedication of the oil dealers to their most clueless customers.
But that also shows yet another liability of oil heat, in addition to dependence on potentially hostile foreign regimes, the economic damage to our balance of payments, and air pollution. The problems caused by delivery by truck instead of pipeline. And residential heating oil tanks eventually leak, possibly contaminating groundwater and causing insurance and liability headaches for property owners. This environmental risk is added to the possible leaks caused by obtaining and transporting oil to begin with.
Moreover, while the independent heating oil dealers have direct contact with their customers, the oil itself comes from some of the world’s largest multi-national corporations. And while natural gas, the other main heating choice, may be distributed by monopoly utilities, including a foreign-owned utility on Long Island (including Brooklyn and Queens), the gas is supplied by a growing domestic industry, albeit one with environmental issues of its own.
I don’t believe it is the government’s job to choose people’s heating fuel, or to put the heating oil dealers out of business. But I was going to suggest at least phasing out the use of the lowest grade, highest pollution heating oils to nudge people along. And that, it appears, is what the city is doing. Beyond the city’s air quality goals, there are other reasons to want to be as oil-free as possible.