Rising heating oil prices and heightened winter demand are forcing Northeastern states to take steps to ensure funding meant for low-income residents does not run dry.
Legislators in Maine, Connecticut, New York and New Hampshire are all considering measures to spend more on home heating oil programs. In Massachusetts, Secretary of the Commonwealth Bill Galvin (D) has urged legislators to refill its own dwindling fund.
The push for funding in part reflects those states’ dependence of on home heating oil. Together, the nine states that make up the Northeast are responsible for 85% of residential heating oil sales, according to the Energy Information Administration.
Home heating-oil prices are up nearly 50% over the past year, according to EIA data, a surge that started as the war in Ukraine boosted oil prices.
But legislatures also face pressure from rising electricity prices. Because states like Massachusetts and New Hampshire generate much of their electricity from natural gas, legislatures there face a second price spike driven by Russia’s war against Ukraine.
In September, New Hampshire lawmakers approved a $42 million package that included one-time credits of $450 for fuel and $200 for electricity. Gov. Chris Sununu (R) called it “the largest energy relief package this state has ever seen.”
Last week, Connecticut legislators have passed an additional $30 million in funding for the Low Income Home Energy Assistance Program.
In Maine, Republicans this week blocked a package of temporary measures backed by Gov. Janet Mills. Those proposals included a one-time $450 payment to low and middle-income Mainers to help afford the soaring cost of heating oil.
Republicans are ultimately likely to back the proposals. They objected on procedural grounds and urged the legislature to hear them through the regular committee process. Senate Minority Leader Trey Stewart (R) said there was no need for expediency since funding for heating assistance was in place through January.
Maine is the most heating-oil-dependent state in the country. There, 60% of homes are reliant on oil, compared to a national average of 4%, Mills’s office said.
Along with the $450 payment, which would help about 880,000 eligible Mainers, the package included $50 million for energy aid and $21 million for emergency housing and emergency shelters. The package would have been funded by an expected $280 million budget surplus in the current fiscal year and nearly $500 million in the next two.
In other affected states, pressure campaigns have not yet borne fruit. New York state Sen. John Mannion (D) introduced heating-oil-aid legislation in October to require the New York State Energy Research and Development Authority to develop, implement, administer and operate a temporary middle-income home energy assistance program and suspend certain taxes on home heating fuels.
The bill was referred to the Senate Finance Committee, where it has languished.
In Massachusetts, Galvin has called for a $50 million reserve fund to provide aid for home heating oil costs, but lawmakers have not signaled support.
“One of the most single, biggest concerns continues to be heating oil inventories, which … are at historic lows,” said Michael Ferrante, president of the Massachusetts Energy Marketers Association.
Ferrante said he was not currently expecting any legislative action on the issue from Bay State lawmakers.
Northeastern states have been had some flexibility to add more funding for home heating programs because of leftover pandemic relief funding.
The $30 million in extra funding for Connecticut’s program, signed into law by Gov. Ned Lamont (D), comes from that Covid-era funding.
Energy-assistance advocates are watching to see if colder weather quickly uses up the aid.
Brenda Watson, executive director of Operation Fuel, which provides energy assistance in Connecticut, said that electricity rates could go up by about 40% at the beginning of the year, further driving demand for energy assistance.
“[A] number of us advocates are concerned about the potential for higher demand, because rates are gonna go up Jan. 1, and fuel prices are kind of fluctuating up and down, but it’s still unaffordable,” Watson said. “So [we’re] hoping that the additional resources the state’s energy assistance program receives, along with Operation Fuel…will get people through the winter.”