In July 2016, the Vermont Fuel Dealers Association (VFDA) contracted with the Center for Rural Studies (CRS) at the University of Vermont to conduct an industry assessment and an economic contribution study of Vermont heating fuel and service companies. This study comes during a time of transition in the home energy sector. Over the past three years, oilheat prices are the lowest they have been in decades. While both price of heating oil and heating degree days fluctuate from year to year the overall heating oil consumption trend is downward. Conversions to other heating fuels, more efficiency heating equipment and advanced weatherization methods have contributed to the decrease in demand of heating oil in Vermont.
CLICK HERE TO DOWNLOAD THE REPORT
Key findings of the study include:
Diversification of services
The Vermont heating fuel delivery and services sector used to be siloed with high business specialization. As a way to reach new customers and to adapt to the changing environment, the survey respondents reported that they are increasing their offerings by for instance selling both fuel and providing services but also by offering new products and services such as biodiesel blending heating oil and heat pumps. Diversificaion into other products and services was actually seen as an opportunity for the industry in the next five years by 48.1% of the survey respondents.
Access to qualified labor
The industry offers good paying jobs with benefits but is facing major challenges in finding qualified labor. The average hourly rate reported by survey respondents is above the average per capita income in Vermont and over 90% of the respondents offer paid vacation time while almost 70% offer health insurance. The lack of qualified trained labor could be a major impediments to business development as 78.8% of the respondents said that the lack of skilled labor prevents them from offering new products and services.
Weight of regulations and taxes
For respondents, the largest challenges for the industry in the next five years are not the changes within the industry but exterior government pressures including taxes, regulations, and renewable energy mandates.
Economic contribution of Vermont fuel dealers to the state economy
Based on extrapolations of the fuel dealer responses to the entire Vermont fuel dealers’ sector, the Vermont fuel dealers support over 1,000 jobs and a little over $100 million in economic activity. Though the contribution of the sector might appear limited, this is due to the fact that the sector sells a product that is manufactured outside the state. Nevertheless when accounting for the rippling effects, the fuel dealers support an additional 739 jobs and $58 million in economic activity in Vermont.