Dependence on heating oil

Despite living in a climate-conscious world, some US states still use billions of gallons of heating oil to keep homes warm. The northeast is by far the most reliant on heating oil, consuming 2.5 billion gallons alone in 2020.

The US states that heat their homes the most with oil

The states in the northeast that use the most residential heating oil are Maine, Connecticut, Massachusetts, New York, and Pennsylvania. While some of these states have shown a decline in usage, opting for natural gas, they still collectively consume over 2 billion gallons of oil annually.

Bunker fuel used for heating oil is the dirtiest and cheapest fuel out there. But the oil is about 30% cheaper than other fuel alternatives. Bunker fuel is used to power ships and cruise liners, with lower environmental regulations to keep the global shipping of goods going with low costs.

Heavy bunker fuel oils #4 and #6 were once responsible for 86% of soot pollution in NYC, according to the city’s DEP. The fuels were officially banned in the city in 2015. Heating fuel is now more commonly ultra-low sulfur #2 oil (ULS 2), biodiesel, and natural gas.

In 2021, natural gas fueled 46% of New York’s utility-scale in-state generation. But natural gas is not a renewable energy, and has its own spiking high prices. Natural gas quadrupled over the past two years due to rapidly growing exports and the LNG market for Europe. Greater demand for natural gas has lowered inventories, and exceeds the ability to deliver it.

Why are states still using heating oil?

Wide availability and affordability made heating oil the fuel choice of the past. But some states are still relying on decades-old tanks and infrastructure. In Maine, for example, three-fifths of households use oil as their primary energy source for home heating, a larger share than any other state. Maine’s natural gas use on a per capita basis was third-lowest in the nation in 2020, after Hawaii and Vermont, because of a lack of distribution systems.

As a result, millions of Mainers are now seeking home heating assistance, but high prices are expected to impact how much assistance programs can actually help. Average heating oil prices in Maine rose more than 80% to $5.71 per gallon in November compared with the previous year. Kerosene and propane prices have also risen, leading to high demand in firewood as Mainers anticipate a cold and expensive winter.

📬 Sign up for the Daily Brief

Our free, fast, and fun briefing on the global economy, delivered every weekday morning.