No. 4 Oil Phase Out: Is Your Building Prepared for the Switch? - Energo

No. 4 Oil Phase Out: Is Your Building Prepared for the Switch?


In February 2023, the New York City Council passed a bill requiring building owners across the city to end the use of No. 4 oil by July 1, 2027 – the city had originally planned to ban the fuel by 2030. Known as Introduction 470-A, the amended bill expedites the timeline by three years to phase out No. 4 oil. Building owners found in violation could be responsible for up to $10,000 in fines. No. 4 oil is used in many New York City buildings as a source of heat. The product, however, is made up of a mix of diesel and fuel oil, which doesn’t burn clean, creating pollutants in the air. Converting to a cleaner fuel source such as No. 2 oil or natural gas will not only help reduce emissions but will also help improve the air quality – which is also in line with NYC Local Law 97’s efforts.

Converting to No. 2 Oil

One way to comply is by converting to No. 2 oil. This is a cleaner fuel source that’s better for the environment. Take, for example, a building that uses 50,000 gallons of heating oil.  If the building converts from No. 4 oil to No. 2 oil, it could reduce emissions by up to 10% (equivalent to 50 metric tons of CO2), potentially saving up to $13,000 in Local Law 97 fines. In addition, No. 2 oil also burns cleaner, which means less maintenance and longer lasting equipment. To convert to No. 2 oil, the DOB requires a certified tank tightness test, a NYC DOB Work Permit, and an amendment of the NYC DEP Registration. Your tank will also need to be thoroughly cleaned – which consists of flushing out the supply and return lines, removing excess sludge, and identifying any tank leaks. As a reminder, Energo highly recommends cleaning your tank every three to five years while the DOB requires annual inspections. Therefore, if you haven’t stayed on top of regular cleanings and inspections, you could uncover eroded pipes and problems with your tanks during this process. Once the conversion process is completed, an inspection by the DOB is required to certify that the tank is fully operational and up-to-code.

Tax Credits Available For Biodiesel

Most of your heating oil is mixed with a blend of biodiesel, which is biodegradable fuel made from renewable sources, like vegetable oil and animal fat. Biodiesel has a lower sulfur content than straight fuel oil, which means biodiesel releases fewer toxic emissions when burned. New York State offers an incentive for those who increase their biodiesel blend to at least a blend of B6 with a one-time tax credit of up to 20 cents per gallon. At Energo, we offer blends of biodiesel from B6 all the way to B20. When you make the switch to No. 2 oil, be sure to ask about increasing the amount of biodiesel into your mix to not only take advantage of the tax credits, but to also create an even cleaner fuel source that’s better for the environment.

Converting to Natural Gas

Converting from a heating oil system to either a firm natural gas system or a dual-fuel system is also an option. The process to convert to a natural gas system could take 6-9 months and requires extensive capital improvements to the building and/or boiler equipment. Converting to natural gas is certainly an ideal investment for buildings looking to reduce their carbon emissions and energy expenses. Energo’s mechanical engineers, licensed NYC master plumbers and trained technicians can assist with your building’s oil-to-gas conversion, complete with tank removal services and installations.

Take Action if Your Triennial Renewal is Expiring

For customers interested in converting to No. 2 oil, it’s extremely important to determine when your Triennial expires as the DEP will not issue a triennial renewal for a Certificate of Operation (CO) for a boiler burning No. 4 oil on or after June 30, 2024. In other words, if your triennial is expiring on or after June 30, 2024, you must convert to No. 2 oil prior to renewing.

Contact Energo

Ensure your building is prepared well before your Triennial expires and before the 2027 deadline. Contact Energo to learn more and to ensure your building is prepared for the switch.