The home heating oil industry has a long and proud history, and Fuel Oil News has been there supporting it since 1935. It is an industry that has faced many challenges during that time. In its 77th year, Fuel Oil News is doing more than just holding
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dateLiNe cONgreSSvOTeSTOreINSTaTe bIODIeSeLTaxINceNTIve The U.S. biodiesel industry applauded as the U.S. House cleared a year-end fiscal package that reinstates the biodiesel tax incentive for 2012 and 2013. "It's been a long year with a lot of missed opportunity and lost jobs in the biodiesel industry. But we're pleased that Congress has finally approved an extension so that we can get production back on track," said Anne Steckel, vice president of federal affairs at the National Biodiesel Board. "This is not an abstract issue. In the coming months, because of this decision, we'll begin to see real economic impacts with companies expanding production and hiring new employees." The biodiesel tax incentive expired on Dec. 31, 2011. A recent study found that the industry would have produced an additional 300 million gallons this year with the tax incentive in place. That would have supported some 19,213 additional jobs, for a total of 83,258 jobs supported by the industry nationwide, according to the study, conducted by Cardno ENTRIX, an international economics consulting firm. Looking to next year, the study found that the industry would support some 112,078 jobs nationally with the tax credit in place versus 81,977 without it. Additionally, the return of the incentive is projected to increase household income by some $1.6 billion next year while supporting an additional $3.1 billion in GDP. Along with these economic benefits, Steckel emphasized that biodiesel is helping reduce America's dependence on imported petroleum and making us less vulnerable to global petroleum markets that continue to disrupt the economy and threaten our national security, while significantly reducing tailpipe pollution and greenhouse gas emissions. "This is important not just for jobs but for diversifying our energy supplies, improving our energy security and reducing costly emissions," Steckel said. The $1-per-gallon biodiesel tax incentive was first implemented in 2005. Featured NeWs Biodiesel tax incentive reinstated EIA energy forecasts for 2013 and 2014 Retroactive extension for HVAC tax credits Refiners petition EPA to waive cellulosic biofuel mandate NY state looking at natural gas conversions Call for Dave Nelsen Scholarship applications AHRI reviews modulating boilers test results NBB joins Diesel Technology Forum Congress has allowed it to lapse twice, in 2010 and again in 2012. Under the legislation approved by the House and first passed by the Senate, the incentive will be reinstated retroactively to Jan. 1, 2012 and through the end of 2013. Steckel thanked the industry's supporters on Capitol Hill for pressing for the incentive, particularly Sens. Maria Cantwell, D-Wash., and Charles Grassley, R-Iowa, and Reps. Aaron Schock, R-Ill.; and Collin Peterson, D-Minn. eIaFOrecaSTS$3.7PergaLLONDIeSeLaND$3.44FOr reguLargaSOLINeIN2013 Regular-grade gasoline retail prices will average $3.44 per gallon and $3.34 per gallon in 2013 and 2014, respectively, according to the Short-Term Energy Outlook published Jan. 8 by the Energy Information Administration (EIA). The EIA notes that, despite similar crude oil prices during 2011 and 2012, U.S. monthly average regular gasoline retail prices increased from an average of $3.53 per gallon in 2011 to average $3.63 per gallon in 2012, driven partly by isolated refinery outages and lower inventory levels on the East and West coasts. U.S. regular gasoline retail prices fell from an average of $3.85 per gallon in September 2012 to an average of $3.31 per gallon in December, which was the lowest average since December 2011. On-highway diesel fuel retail prices averaged $4.12 per gallon in September 2012, and continued tight market conditions and strong demand for exports kept on-highway diesel fuel prices at an average of $3.96 per gallon in December. On November 23, 2012, U.S. week-ending stocks of distillate fuel oil fell to their lowest level since May 30, 2008, despite the higher expected demand during the current winter heating season. Distillate inventories have since recovered, especially in the Northeast, though still remaining well below their five-year average. After averaging $3.97 per gallon in 2012, EIA expects that on-highway diesel fuel retail prices will average $3.87 per gallon in 2013 and $3.78 per gallon in 2014. Wholesale diesel margins (the difference between the wholesale price of diesel and the U.S. average refiner acquisition cost of crude oil) averaged $0.60 per gallon in the first half of 2012, and then climbed to an average of $0.92 per gallon in November, the highest monthly average since October 2005. EIA projects wholesale diesel margins will average $0.75 per gallon in 2013 and $0.63 per gallon in 2014, compared with the previous five-year (2007-11) average of $0.54 per gallon. cONgreSS,PreSIDeNT reTrOacTIveLyexTeNDHvac aNDWaTerHeaTINg25cTax creDITS On January 2, President Obama signed legislation designed to avoid the "fiscal cliff" and keep tax rates from increasing for every American who pays taxes. In addition to its many other tax provisions, the bill retroactively reinstates the 25C tax credits for highly efficient HVAC and water heating equipment that expired at the end of 2011. Specifically, the bill extends the tax credits that expired in 2011 from January 1, 2012, until December 31, 2013, for qualified equipment listed in Section 25C of the Internal Revenue Code. Because the www.fueloilnews.com | FueLOILNeWS| February2013 3