Salem Observer : Salem, fuel

Salem police responsible for $80,000 budget shortfall

Salem Editor — Wed, 06 Aug 2008 18:37:00 GMT

Salem financial officials have put the town’s departments on notice to tighten their belts as fuel prices dip deeply into municipal budgets.

After a budget shortfall from the increased cost of fuel of $150,000 already this year, town finance officials are asking the “big three” departments – fire, police and public works – to keep an eye on their spending in order to make up the deficit.

“Police, DPW, fire – they are all on top of it,” said Jane Savastano, finance director for Salem. “They understand completely. They’re doing their best not to spend on their other lines without interfering with public safety.”

About $80,000 of that shortfall has come from the Police Department. According to Capt. William Teuber, officers are taking steps to cut back on their own fuel consumption without putting public safety at risk.

“We have been told to watch how much gas we’re using,” Teuber said. “If we’re not using the car, we shut them off. Rarely do we have cars just sitting there being idle.”

While police officers have begun turning off the air conditioning of their vehicles to increase fuel efficiency when on patrol and no longer keep vehicles idling while filing reports, Teuber does not think there is much more that can be done short of placing mileage limits on officers out on the road.

“If the guys are parked on the side of the road, you can’t shut the car off, the radio doesn’t work,” he said. “The car has to be running if we’re on patrol; we’re out on the road. We’re a pretty big town. We have guys all over different routes in the town.”

Due to the weight of the vehicles and the amount of equipment inside, Salem’s police cruisers get around 15 miles for every gallon of gasoline. While the department is currently looking at Dodge or Chevrolet manufactured police cruisers for the future, the difference would only be a few extra miles per gallon.

The addition of two new Harley-Davidson motorcycles to the department in the fall should take some pressure off of the budget, according to Teuber. Until then, he said, the department had enough funds left unused to cover the added expense of high pump prices.

“We’re under budget right now. Looks like we’re going to have enough money to cover it,” he said, but warned that the department could go through as much as $10,000 in investigation costs if a serious crime was committed in the town.

The Police Department is already planning to ask for a $78,000 increase to offset fuel and heating costs next year.

According to Dave Wholley, operations manager at the Salem Department of Public Works, department resources have been better allocated to keep their operational costs down, but budget shortfalls have not kept them from keeping up on maintenance or completing repairs.

“Our work has to get done. Obviously, we understand that there is going to be a shortfall somewhere, but operationally, when there is a basin collapsed, we’ve got to fix it,” he said. “We are trying to be as efficient as possible.”

Unless a project presents a public safety hazard, the department may hold off on completing a job until they can do three or four other projects at the same time in the same area, Wholley said. The policy, designed to increase efficiency, has been practiced by the department in the past.

Looking toward the future, Savastano is budgeting for a little higher than the current cost of gasoline for next year. At the moment Savastano is estimating gasoline at $3.96 a gallon and diesel at $5.00 for the 2009 fiscal year. Her figures also incorporate the three or four cents extra per gallon the town pays above the consumer price index as per their contract with their supplier.

Savastano has also built an escalator into the budget – not a part of this year’s budget, which was unprepared for gas prices to jump nearly $1.50 more than estimated – in case fuel prices increase further.

“This is the first year that this (shortfall) has happened,” Savastano said. “We had budgeted really low – diesel was $2.61 a gallon in our budget (in FY ’08). We’re really conservative about our budget proposals this year.”

Cheaper heat: How efficient is your fuel?

Salem Editor — Wed, 09 Jul 2008 18:02:00 GMT

BY GINGER KOZLOWSKI

If there’s one person who’s doing well in this changing economy, it’s John Labbe.

Labbe is the owner of Hearth Designs in Hooksett, and he sells pellet stoves, wood stoves, fireplaces and other heating-related items.

With people looking for alternatives to heating with oil, he said pellet stoves are outselling wood and gas stoves 10 to one, and his store has been swamped.

“Most people have already decided they want a pellet stove,” said Labbe, about the customers he has. “They’ve done their research.”

And no wonder. Heating with wood pellets has become considerably cheaper than heating with oil. That is, as long as pellets are priced about where they are currently – around $280 to $300 a ton.

Labbe said the energy output of pellets at $280 per ton is equal to the energy output of oil when it’s at $2.40 per gallon. Those days appear to be far behind us, with fuel oil well above $4 a gallon.

It’s an investment, though, to convert or supplement your home’s heating system. Pellet stoves run about $3,000 to $4,000 installed, said Labbe, so it can be daunting to come up with that kind of money when one is already struggling to pay last year’s oil bill. And the stove really won’t eliminate your oil bill, as it’s more of a supplementary system that allows you to turn your oil system down or even off, depending on the configuration of your house and how warm you want each room to be, said Labbe.

How to decide if it’s worth it? It’s not easy.

“Electricity follows gas and oil prices,” said Tom Belair, a spokesman for Public Service of New Hampshire (PSNH), which provides electricity to this area. “It doesn’t matter what (fuel) you use, efficiency is what’s important.”

Belair points out that all forms of energy tend to rise together, so it may not be long before pellets, electricity and gas go up in price as well, negating the savings you expect from a conversion or supplementary heating system.

Indeed, pellets and cord wood are already in high demand and low supply, according to Lester Robinson, manager of Osborne’s Agway in Hooksett.

“We’re out of wood until September,” said Robinson.

His store sold out of pellets when they advertised a pre-season sale in May and June for $250 per ton. His vendor now can’t guarantee product until September, and he expects it will cost about $300 a ton.

“We cut our own firewood,” he said. “Had 100 cords, we sold it all.”

And it’s not just fuel. He said his Agway has sold more vegetable seeds and chickens this year than ever before, with people trying to save money by growing their own food and getting eggs fresh from the chicken.

So what do you do about that high heat bill?

“Make sure you’re not wasting (energy),” said Belair. “Making a long-term decision (based on today’s oil prices) may be short sighted.”

Diversity is probably a good idea, he said. Adding a pellet stove to an oil system at least gives you the choice of using whichever fuel is least expensive at the time. Having an electric space heater in the one room you sit in in the evening and turning down the heat in the rest of the house can save on the oil bill.

But make sure that portable space heater is safe, Belair emphasized. It shouldn’t be used as your main heating source.

“Buy a safe one!” he said.

Solar power could help

BY JENN MCDOWELL

While solar energy can save homeowners big on their heating bills, it’s pricey to install and based on current heating oil prices can take over five years to pay for itself, according to Malik Haig of Sustain Ablity New Hampshire, a Laconia-based solar products distribution company.

Haig said manufacturers have said a solar air heating system could save about $500 per year on fuel bills. “But of course, that was based on last year’s prices,” Haig said.

A solar air heat box can alone warm up to 1,000 square feet, Haig said, by pumping the heated air into the home. It takes about 10 minutes from the time the sun comes out to heat the box, which pulls cool air from inside the home and pumps it back in at temperatures between 90 and 100 degrees. It uses about 30 watts of electricity to run the fan that blows the air inside, Haig said.

A bigger savings can be found in using a solar hot water heating system with rooftop solar panels, or “flatplate collectors.”

“This doesn’t replace an existing heat source, just vastly reduces it,” Haig said, adding the equipment needed to run such a system starts at about $3,635, plus a few thousand dollars more for installation depending on the size of the house and the amount of copper piping it has running in it.

Haig said homeowners could reduce their oil or gas consumption by about one-third over a winter, but said the savings won’t be realized for about seven to 10 years after the system has paid itself off through fuel savings. If fuel prices continue their upward trend, that payoff could be a lot sooner, Haig said.

“There’s a lot more interest now, and lots more people coming in and saying, ‘I can’t take any more of these rising fuel costs,’” he said.

Geothermal's a good choice

BY MATT SCHOOLEY

Geothermal heat pumps can be an expensive up-front cost, but in most cases are worth that high price in the long run.

Leeds Burchard of Ultra Geothermal and Ultra Heating and Cooling in Barrington said there is no way to estimate a cost without knowing the specifics of the house, as two homes with the exact same dimensions could end up costing different prices based on the ground source.

“There are no drawbacks,” said Burchard. “When it comes down to new construction, it’s the only way to go. It’s time the country got off the dependency of fossil fuels.”

For existing houses, geothermal may not be the best fit, as Burchard said not all homes are good candidates for a retrofit.

Burchard said since the company started installing the systems, they have seen an increased demand due to rising costs of fossil fuels.

“We’ve definitely seen a significant increase,” he said. “Twelve years ago we started installing, and we were lucky to do two a year. Now we have 40 to 50 on order and have over 300 installed.”

Firewood's a traditional choice

BY SARAH LEBRUN

Though pellet stoves are the hot item this year, many people still choose to buy the traditional wood stove.

According to Bob Gardner, manager at Fireplace Village in Concord, wood stoves range in price from $800 to $2,500, and some are capable of heating a 3,500-square-foot area.

According to www.alternative- heating-info.com, a cord of wood as of June 10 was selling for an average of $240 per cord, or a stack of wood that is 4 feet high and 8 feet wide.

According to Pat Dean at Joe Gauci Landscaping in Bedford, they are selling split and seasoned wood this year for $325 per cord, delivered locally to Manchester, Bedford and Goffstown.

“We expect this to really go fast because the prices keep rising,” said Dean.

“Don’t wait too long to buy wood or pellet stoves this year,” said Gardner. “You might not get one. Manufacturers are backed up like crazy.”

Firewood's a traditional choice

BY GINGER KOZLOWSKI

Pellet stoves are the hot alternative to the traditional wood stove, and they’re selling like hotcakes, according to John Labbe of Hearth Designs in Hooksett.

While it’s like using a wood stove, the pellets, which come in 40-pound bags, are easy to load into the hopper of the stove, and the stove itself can regulate itself with a thermostat, keeping your home at a steady temperature without poking at wood to keep it burning.

For about $3,000 to $4,000, said Labbe, you can have a stove installed in your home. The beauty of it is that you don’t need the traditional venting. A pellet stove can be located almost anywhere. A heat sensor can be run as far as 100 feet away from the stove, allowing the room’s temperature to be set where you like it.

One consideration is where to store all those pellets, though. They’re typically bought by the ton, said Labbe, so you’ll have a delivery of quite a few 40-pound bags on a pallet. Most people store them in their garage, he said.

The rising cost of fuel in Salem, Pelham and Windham

Salem Editor — Wed, 02 Jul 2008 19:00:00 GMT

BY JENN McDOWELL

Alice Campbell of Salem, retired and living alone in her home, said she’s not sure how she’s going to deal with heating oil expenses that add up to even more than what she paid last winter, which was about $2,000 total for her small cape home.

“As it is now, I shut off my dining room completely because I don’t use it much in the winter,” said Campbell. “I don’t know what I’m going to do this winter, but we’ll have to see.”

“It’s scary. My son and I were talking about this, and the situation is getting really scary,” she said. “I’m 80 years old and I’m trying very hard to hold on to the house.”

Al and Colleen Alfaro live in Pelham.

“I know we’re estimated to spend about $4,000, and we’ve decided to go on a budget plan,” said Colleen Alfaro, adding they use Rockingham Oil in Derry.

She added they would certainly be making greater use of their wood stove this winter.

With oil prices hovering around an average of $4.50 per gallon on the low end, about twice what most people were able to lock into last year, wood may become a hotter commodity this winter than ever before.

Local governments under stress, too

Salem finance director Jane Savastano said the town’s oil rate is going to more than double come July 1.

Most of the town’s buildings run on oil heat, Savastano said. Only six, including the library and senior center, run on gas.

The town is still under contract until June 30 to buy oil for $2.15 per gallon. The town had to go out for bidding on oil again a month ago, she said, and had to lock in a rate of $4.39.

Luckily, she said, the town has enough left in its 2008 budget to pay for the oil at that price and get them through the year.

The town budgeted $187,088 for the year, and has so far expended $88,624, she said.

“It won’t be as bad for Salem as it will be for other towns,” said Savastano, pointing out the Salem has an advantage by operating its budget around a calendar year rather than a fiscal year.

Most of Windham’s town buildings run on propane, the price of which is also increasing. The administrative offices, senior center, and Searles building all run on oil heat, said finance director Dana Call.

The town was able to prebuy their oil in 2007 at a price of $2.19 per gallon, Call said, having budgeted $57,380 for oil and actually spending $53,200. When the pre-purchased fuel ran out though, Call said, the town did have to buy some at around $4 per gallon.

“We did all right because we usually pre-buy at low prices. That’s probably not going to be the case this season,” Call said.

The town budgeted $51,890 for 2008, Call said, having developed the budget numbers back in fall 2007.

“We will be over budget,” said Call. “We didn’t know back in the fall that we’d be paying this amount of money,” she said, adding the town is looking at joint buying ventures for next year.

The situation is so dire, Pelham Town Administrator Tom Gaydos joked, “We’re looking at drilling our own wells.”

In Pelham, the municipal complex, senior center and barn, annex, historical society, dog pound, transfer station, recreation building and highway building all run on oil heat, Gaydos said.

Gaydos said Pelham used 23,700 gallons of oil in 2007 for a total cost of $52,351. So far in 2008, the town has used 12,984 gallons and has spent $28,500 out of the budget.

“We bid fuel costs with the school which provides a huge savings,” said Gaydos. “We will bid again in August.”

Even oil providers feel the pinch

While they are in the money- making business, several oil companies in the state have said the through-the-roof prices are not exactly good for business, and are going to pose a problem this winter as they try not to buy too much for deliveries.

“The biggest concerns are the elderly and people on fixed incomes,” said Bill West, manager of the Derry-based Rockingham Oil. “How are they going to come up with that money? They’re going to have to choose between heat and food, and that’s not a good place to be.”

Rockingham Oil’s price is hovering at $4.49 a gallon right now, up almost double from the $2.31 the company was selling a gallon for in March 2007.

West said they’re still doing pre-buy and budget plans, but won’t set a lock-in price until August.

“For anybody in this industry, the lower the price, the more fuel you sell. But it’s a commodity – everybody needs it,” said West, adding sales are currently down and collections are higher.

Ricky Barnard, manager of Contoocook Valley Fuel, said the oil prices aren’t good for anyone, oil companies included.

Right now, Barnard said his company, a family-owned and operated business since 1961, is selling 150 gallons of oil at a discounted price of $4.59 per gallon. The company has a 100- gallon purchase minimum, and is selling 100 to 149 gallons for $4.69 per gallon.

Like Rockingham, Contoocook Valley is still going to offer pre-buys and budget plans, but won’t set a price until the end of July or August.

“I’m hoping it will get better. Some people say it will go higher, and others say it will come down and the bubble will pop,” said Barnard.

He added the nation’s reliance on foreign oil sources should be actively diminished.

“I think we should be allowed to drill inside the United States, and we need to update the refineries,’ said Barnard.

Viking Oil, based in Candia, sold out of the oil it was selling at $4.49 a gallon in two days, according to owner John Mayland.

“We usually go out with a contract at a stated price based on next heating season buys,” said Mayland. “This year, we sent out a letter to customers saying we have only so much oil, and to call for a price and contract paperwork. We sold out in two days at $4.49 a gallon. Now we’re selling at a higher price, $4.74 a gallon,” Mayland said.

Mayland added the volatile market is making it hard to determine how much he should get for his customers. “We’ve been very careful about buying too much. We’re not sure how much people are going to use,” he said.

A lot of customers have told him they’re going to keep their thermostats set extremely low and use space heaters, Mayland said.

Fred Fuller Oil Co., one of the largest in the state, is selling oil at $4.59 a gallon right now. In June 2007, said general manager Bill Fuller, the price was $2.20 a gallon.

“People can’t afford to fill their tanks or afford to do any pre-buy or budget plans,” said Fuller, adding the company will still offer both, but has yet to lock in a rate.

Plans for biodiesel plant fueling up

Salem Editor — Wed, 11 Apr 2007 20:14:00 GMT

BY MATT HERSH

Salem will be the state’s first hub for commercial biodiesel fuel production after two local businessmen have proposed the idea to planners.

On Tuesday, April 10, the Planning Board unanimously approved a site plan submitted by Dan Espinal and Tim Hickey for a manufacturing plant at 51 Northwestern Drive, just off Interstate 93.

The two Salem residents said they will start a company called Atlantic Biodiesel in hopes of providing a new source of energy for the area and encouraging local farmers to grow oil-seed crops to create the fuel.

Hickey and Espinal said they have been formulating their business plan for more than a year and were happy planners approved their proposal.

Espinal said he came up with the business idea after attending a conference in South America about alternative energy sources. One of the discussion topics was biodiesel fuel.

“I had an idea already about doing something with renewable energy sources because of what is going on with the world and global warming,” he said. “I heard about biodiesel, and I thought we could do this right here in Salem.”

Espinal said he recruited Hickey, who he had known professionally already. The two men came up with an idea that could be profitable while helping the environment.

“We need to pay ourselves,but it is our full intent to keep New Hampshire a green state,” Hickey said.

Biodiesel is made by heating vegetable oil or fat to 150 degrees and mixing it with lye and alcohol. The result is a fuel which is both biodegradable and nontoxic. Typically, it produces about 60 percent less carbon dioxide emissions than petroleum-based fuels.

Proponents of the fuel source also cite it as a way to move the country away from relying on foreign oil sources.

The Salem proposal came less than a week after the House passed a bill to establish a commission which will promote biodiesel fuel production in the state.

Espinal and Hickey said their plant would likely produce about 3 million gallons of biodiesel a year with the hope of upping the amount to about 10 million gallons in the future.

Atlantic Biodiesel will likely sell their fuel to a distributor who would mix it with home heating fuel and diesel gas, Hickey said.

Members of the Planning Board had one potential issue with the proposal. Board member Robert Campbell said a town law prohibits the storage of fuels in certain areas. Campbell said he was concerned about potentially violating the town’s zoning laws.

However, after a lengthy discussion, the board concluded that the law, which was written in 1987, did not apply to biodiesel because the product will not be stored at the facility.

In addition, biodiesel is not considered to be a fuel until it is mixed with other petroleum-based fuels.

“It’s a matter of semantics,” said board member Eugene Bryant. “Unless you want to look for a meaning and make it apply, then the (law) in question does not apply to the manufacturing and processing of this product.
The technology has run in front of our 1980s zoning.”

Hickey said the biodiesel product will be picked up on a daily basis and storage at the facility will be limited to 24-hour periods.

Other concerns about the plant’s potential impact on the air quality were eased when Hickey explained that the process is entirely sealed and produces no air or water emissions.

In addition to comments from Hickey and Espinal, other officials came to speak in support of the business.
James Garrity, a state representative and chairman of the state Energy Policy Commission, told planners he was excited to hear about the proposal.

“Biodiesel does what we want to do,” he said. “It creates non-Middle Eastern fuel that can be a source for America’s school buses, vehicles and eventually our basement oil heaters.”

Now that planners have given the nod, the two men will only need to obtain local permits from the Environmental Protection Agency before they can get to work.

Hickey said the company will not require any permits from the state for water or air emissions because the fuel creation process is fully sealed.

Should the business succeed in Salem, the two men said they would like to expand it to other locations on the East Coast.

For the time being, Espinal and Hickey said they will work on getting the Salem plant up and running with the hopes of opening sometime this summer. Espinal will serve as the company’s chief executive officer.