Clean Heat Standard
A Massachusetts & Vermont CHS presents challenges and opportunities — and DES can help you prepare
On November 30, 2022, the Massachusetts Commission on Clean Heat recommended the implementation of a Clean Heat Standard (CHS) in the commonwealth. In April 2023, the Massachusetts Department of Environmental Protection released a “straw proposal” outlining the design of the CHS. A Massachusetts CHS will represent the most significant change to Northeastern energy markets in many years — one that is likely to reverberate through other states in the region.
Massachusetts heating fuel distributors undoubtedly face challenges in the CHS marketplace. However, there are also tremendous opportunities for businesses that prepare for its implementation. Diversified Energy Specialists (DES) can put you in the best possible position to maximize your profits in the CHS market.
The Vermont Clean Heat Standard was passed by the Vermont House and Senate in early 2023. In the summer of 2023, the legislature will vote to override the expected veto by the governor. If implemented, the Vermont CHS will disrupt Vermont energy markets in the years to come.
Diversified Energy Specialists is the most trusted CHS advisor
Just as DES is the most knowledgeable, forward-looking and profit-generating aggregator of the Alternative Energy Portfolio Standard (APS), we are also the primary authority on the Massachusetts and Vermont CHS.
President Joe Uglietto has testified to New England legislatures on CHS programs. He has presented extensively at industry conferences. And DES has its finger on the pulse of CHS-related activity in Massachusetts, Vermont and beyond.
In short, Diversified Energy Specialists is the only retail energy consultant with insights and strategies specifically geared toward your success in the CHS marketplace. We have the tools to put you in an advantageous position for the regulatory environment to come.
Let’s work together to prepare for the “new normal” of the Massachusetts and Vermont CHS
While Massachusetts and Vermont move at full speed to implement a CHS that will affect all heating fuel providers, your company needs to get ready for the “new normal.” Here’s what you can expect from the CHS market:
- The CHS will almost certainly become the primary regulatory mechanism for the heating fuel industry. It will likely replace the biofuels market in the Massachusetts APS program.
- Everyone will participate. Unlike the APS and other market-based thermal programs, the CHS will not be opt-in. Every fuel provider will be required to participate, either by generating credits or by purchasing them.
- You need to blend biodiesel. Whatever the final framework of the CHS is, heating fuel retailers will benefit by incorporating biofuel into the product they sell and deliver.
- There will be other ways to generate credits in the CHS, including heat pump installation, weatherization, and selling fuel containing renewable propane.
Of course, there are many unknown factors you need to account for, including:
- How should you account for the per-gallon price of biodiesel (B99.9) when determining the optimal blend ratio for your heating oil?
- Will heating oil retailers or wholesalers be obligated parties in the CHS?
- Should you invest in infrastructure assets like heated bulk storage and terminals?
- Will your business benefit from how the carbon intensity of biodiesel is scored in the CHS?
You owe it to yourself to begin planning for the CHS now. And DES is here to help. We will enable you to develop an action plan tailored to your specific business, with milestones that put you in a prime position when the CHS goes into effect.
Let’s start our conversation today. Get in touch with Diversified Energy Specialists for customized, actionable insights on the Clean Heat Standard.
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“We’ve worked with Diversified Energy Specialists since the inception of the Massachusetts APS program and we couldn’t be happier with our decision. Joe’s excellent understanding of the program and superb administrative support makes the process very easy for us. He has consistently secured strong returns on our energy credits, and he’s a heck of a good guy on top of it all.”
— Jim Townsend, President & CEO, Townsend Energy