[1] In New Jersey, environmental regulations limit consumption of high-sulfur distillate fuel oil by large-volume distillate users.

[2] Furnace tuneups, insulation, and other efficiency measures may also reduce distillate consumption; however, they are unlikely to have a significant impact and are not included in this study.

[3] Throughout this report, the term “home heating oil” is used to indicate Number 2 high-sulfur distillate fuel oil. There are exceptions to this definition which, for the sake of improved communication to a broader audience, are often simplified—for example, Number 1 distillate oil and low-sulfur Number 2 distillate can also be easily used for home heating if necessary and available. Price usually precludes their use for heating.

[4] Diesel fuel oil and home heating oil are both distillate fuel oils. The primary difference is that on-road diesel fuel has a lower maximum sulfur content and is subject to Federal and State motor fuels taxes. Diesel has slightly higher cost, excluding taxes, than high-sulfur distillate or home heating oil.

[5] Interruptible contracts, as an industry practice, equate “quality of service with cut-off temperatures”—the lower the cutoff temperature, the higher the quality of service and the higher the transportation rate charged. When temperatures fall below specified cutoff temperatures, the gas transporter/marketer may provide notice of up to 24 hours, after which the customer is to stop consuming gas. Notice to cut off usage is not necessarily automatic.

[6]  West Texas Intermediate spot oil price.

[7]  The Northeast is defined as Maine, Vermont, New Hampshire, Connecticut, Rhode Island, New York, New Jersey and Pennsylvania. This conforms to Census region 1, composed of Census divisions 1 and 2 (New England and Middle Atlantic).

[8] The Central Atlantic, also known as Petroleum Administration for Defense District (PADD) 1b, consists of New York, Pennsylvania, New Jersey, Delaware, Maryland, and the District of Columbia.

[9] The consumers are residential, commercial, industrial, and electricity generators.

[10]  Energy Information Administration, Manufacturing Consumption of Energy 1994, DOE/EIA-0512(94) (Washington, DC, December 1997).

[11]  Because distillate fuel oil consumption for electricity generation in periods other than the winter heating season does not adversely affect home heating oil prices, it is excluded from the “reasonably switchable” calculation.

[12]  The methodology used to derive the maximum distillate fuel that is switchable in the short run intentionally overestimates the actual amount. Because actual consumption data for January and February 2000 are not available, the switchable amount was calculated by sector (commercial, industrial, and electric generation) from available data based on normal weather and adjusted to approximate the conditions of the winter of 1999-2000. Taken together, it is estimated that distillate consumption during an unusually cold 3-month winter period could be as much as 42 percent higher than consumption during a normal winter.

[13]  “Distillate-only” means that the equipment can only burn distillate fuel oil.

[14]  Some establishments have separate gas and distillate (or residual fuel) boilers to serve the same energy needs, choosing the fuel and equipment to be operated on the basis of relative fuel costs.

[15] Current supply is the sum of production, imports, and net inflow from other domestic regions. It excludes storage withdrawals and production within the region.

[16]  NGI’s Daily Gas Price Index (January 18, 2000), p. 3.

[17]  NGI’s Daily Gas Price Index (March 9, 2000).

[18]  State of New Jersey, Board of Public Utilities, Board of Public Utilities Heating Oil Review (February 23, 2000), p. 6, web site www.state.nj.us/bpu/wwwroot/communication/Govrpt.PDF.

[19] Gray, Gray, & Gray, Oilheat Survey 1999, web site www.graymail.com.

[20] State of New Jersey, Board of Public Utilities, Board of Public Utilities Heating Oil Review (February 23, 2000), p. 6, web site www.state.nj.us/bpu/wwwroot/communication/Govrpt.PDF.

[21]  An electricity generator is “dispatchable” if it can provide electricity on an as-needed basis. Solar and wind plants are intermittent generators and are therefore not dispatchable.