Diesel use for home heating oil

[Car Jack]

In New England, lots of houses are heated with oil.  Being one of these houses, I was aimlessly cruising around some random forums and found my way into alternate fuels for diesel cars and then to home heating oil.  As it turns out, some were talking about using diesel if needed because it's essentially the same as home heating oil.  The only downside I found in the different places was that diesel is taxed for road use so can be significantly more expensive.  Well, I got a delivery yesterday and even with a prompt payment discount, I'm paying $2.88 a gallon.  Looking around today while driving around aimlessly (not really, but it sounds more funny), I noted diesel prices in my area.  Well, they're between $2.44 and $2.81.  WTF?  That's not more expensive.  So with a bunch of Shell gift cards from stop and shop gas points buying, I'm ready to reduce my home heating bill.

[MrFrugalChicago]

This is really really really really bad for the environment.

[Jenny Wren]

It's my understanding that diesel and home heating oil are the same thing, so one wouldn't carry a larger eco cost than the other (they both equally suck because fossil fuels really, really suck, in other words). Diesel (or heating oil, can't remember which) has a dye added so truckers don't try to use the generally cheaper home heating oil to get around road taxes.

My guess with the price is you hit a seasonal anomaly. Fuel costs are still a week out from the holiday climb. On the other hand, this is late in the season to be purchasing home heating oil, so you are going to pay a premium. If you had ordered oil, say in in September, it likely would be much less than both the current home oil and diesel prices. Diesel may be cheaper this week, but likely won't be next week. Plus, how will you pick up and deliver it safely? I'm not sure I would feel comfortable transporting tens to hundreds of gallons of the stuff, then transferring it to a heating oil tank by hand. Of course, this is your call, but it is a concern to consider.

[BDWW]

Delivery charges have greatly increased the prices of getting fuels to your home. On our family ranch, we used to have gas and diesel delivered. Sometime in the late nineties/early aughts it became more economical to drive into town and get the tanks(500 gallon) filled.

If you have a way to transport it, it might be cheaper to buy it at a distributor and transport yourself rather than paying for delivery. I don't know if they offer red-dyed* diesel where you live, but around here it's significantly cheaper.

*As Lichen mentioned, this is a special diesel they sell for off-road use (think tractors, generators, etc) that get's excluded from road tax.

[Reynolds531]

The local caterpillar rental dealer will sell you dyed diesel.

[BudgetSlasher]

This is really really really really bad for the environment.

Heating oil is diesel fuel. Actually heating oil may have a higher sulfur content than ultra low sulphur diesel that is required for on road, possibly making it a better cleaning than heating oil.

Of course heating oil is not the best fuel on its own, but the reality is much of the northeast is something like this. Natural gas is not available at the residential level outside the major cities and a few key roads. Propane is more expensive than oil (most of the time), even when considering its increased efficiency and decreased maintenance costs. Wood and pellets, at the moment, are competitive with oil (competitive, not blow the doors off off) and require more user involvement. And electricity is multiple times the price per BTU. Even with incentives the economics simply are not there to replace a functional oil system (they do change if the system is already in need of replacement). The only things that make sense economically are to reduce oil consumption through thermostat settings, adding an outdoor reset, taking domestic hot water off of the boiler in the summer, air sealing, and insulation upgrade (especially basement concrete walls).

It's my understanding that diesel and home heating oil are the same thing, so one wouldn't carry a larger eco cost than the other (they both equally suck because fossil fuels really, really suck, in other words). Diesel (or heating oil, can't remember which) has a dye added so truckers don't try to use the generally cheaper home heating oil to get around road taxes.

Having been on the regulatory side of diesel/heating oil. I am confident saying heating oil is diesel. Now depending on where you live the two may be made to different specifications (most likely sulfur content). Though a lot that will go away over the coming years as new heating oil standards are phased in.

My guess with the price is you hit a seasonal anomaly. Fuel costs are still a week out from the holiday climb. On the other hand, this is late in the season to be purchasing home heating oil, so you are going to pay a premium. If you had ordered oil, say in in September, it likely would be much less than both the current home oil and diesel prices. Diesel may be cheaper this week, but likely won't be next week. Plus, how will you pick up and deliver it safely? I'm not sure I would feel comfortable transporting tens to hundreds of gallons of the stuff, then transferring it to a heating oil tank by hand. Of course, this is your call, but it is a concern to consider.

Here I cannot say that there is a holiday climb for heating oil and most people do no pre-buy at the start of the season, but are on a monthly keep full service.

To the original poster. If you are going to be buying at the gas station, you might look into whether the IRS or your state will refund the road-taxes on diesel fuel that is used for off-road purposes.

[Car Jack]

Thanks for the replies, guys.  We have been on automatic deliver for many years with a company that was chosen by an oil co-operative, so the cost for the area is pretty good.  I also have a Kubota diesel tractor, so I get fuel periodically anyways.  We have a forced hot air wood burning furnace in addition to oil and I have acreage that I forest manage to harvest fire wood (state tax reduction of my local property taxes), so I use far less oil than if I didn't partly heat with wood.

I'll look to see if there are dealers who sell off-road use diesel for a lower cost.  At the moment, I only buy at stations that are not out of the way and that I know are near the lowest price in the area.  I'm not transporting 500 gallons at a time.....only a 5 gallon can.  But I'm quite comfortable getting 5 gallons, dumping it into the heating oil fill and then putting it back in the car for the next time I happen to be going by the cheap gas station.

I'm not quite sure what's environmentally bad about buying diesel when I'd be burning exactly the same amount of heating oil.  We have no access to natural gas and propane is more expensive and since a house in our town literally blew up, killing twin girls about 10 years ago, I have no interest in getting any kind of gas.  Electric......well, our rates are 19 cents per kWHr, so our heating bill would tripple if we did electric heating.  New England electric generation is majority natural gas and the sources are very restricted because of a lack of adequate pipelines into the region.  Our natural gas rates can be 2 to 3 times what the US average price is.  That's passed on to us.

[Lucky Penny Acres]

Have you looked into a ground source heat pump (a.k.a geothermal heat pump) instead of pure electric heat?

I had a similar scenario - no access to natural gas lines and a home heated by fuel oil.

I replaced an aging oil boiler and oil hot water heater with a geothermal heat pump and heat pump hot water heater. It has a high up front cost and a relatively long pay back period given the current price of fuel oil, but removes the variability of fuel prices and is better for the environment in the long term (I also installed additional solar panels to cover the extra electric use of the heat pump).

Depending on your set up, the heat pump can also be reversed and used to cool your house in the summer.

[Car Jack]

I doubt that would work for me.  If I drill down 3 feet anywhere near my house, I hit solid granite.  The cellar hold for the house was created by lots of explosives.  Drilling into granite isn't fun or cheap.  I've been trying to do this to simply make big rocks into smaller rocks so I can roll them with my tractor and have had zero luck.  Getting a 1/4" deep hole for an hour's work ain't gonna cut it.

[BudgetSlasher]

GSHP pricing varies, when we first moved in I got 3 estimates; all where over $30,000 after incentives (about half was geothermal and half was upgrading the existing well to handle the load, going with trenches would have saved 5k). That was well in excess of replacing the  existing system with any flavor of boiler (like 2 decades of fuel at current costs). Some of the installers that we dealt with freely admitted that we were not likely to see a financial benefit from it. Given that we have no concerns with our current boiler, we viewed the cost as even more (since we were not already upgrading).

In the end we that upgrading the controls of the current boiler, insulation upgrades, air sealing, and solar all have much higher ROIs than converting to geothermal.

I am not knocking geothermal, I would love to have it and I would love to couple with solar. In our conditions it simply does not make financial sense. If there are changes in the future that can bring the cost down, I would love to revisit the issue.