PRESIDENT CLINTON ANNOUNCES RELEASE OF LIHEAP EMERGENCY FUNDS & OTHER
STEPS TO EASE SHORTAGE OF HOME HEATING OIL
September 23, 2000
President Clinton today will direct the Department of Health and Human
Services (HHS) to release $400 million in Low Income Home Energy Assistance
Program (LIHEAP) emergency funds. The President also announced a series of
other steps that will reduce the likelihood of high heating oil prices and
price spikes this winter. Today?s announcement builds on yesterday?s
announcement that the Department of Energy (DOE) will initiate an exchange
of crude oil from the Strategic Petroleum Reserve (SPR) and on the
President?s July decision to establish a home heating oil reserve in the
Northeast. The President will renew his call on Congress to enact key parts
of his comprehensive energy strategy, including his energy tax and
investment packages; to reauthorize the Energy Policy and Conservation Act,
which authorizes operation of the SPR; and, to authorize the establishment
and operation of a permanent heating oil reserve in the Northeast.
PRESIDENT CLINTON DIRECTS $400 MILLION RELEASE IN LIHEAP EMERGENCY FUNDS IN
RESPONSE TO HIGH HEATING FUEL PRICES: President Clinton today will direct
the Department of Health and Human Services (HHS) to release $400 million
in Low Income Home Energy Assistance Program (LIHEAP) emergency funds to
all States to assist low-income households facing significant increases for
heating oil, natural gas, and propane prices this coming winter. This is
the largest release of LIHEAP emergency funds ever. By acting early, this
action will encourage States to take steps now to help low-income
households cope with high fuel prices this coming winter. States can raise
benefit levels, adopt the maximum income limit(strikethrough: s) under
Federal guidelines or expand outreach to assist more families.
? These funds also will enable consumers to take steps to secure their
supply of heating fuel for the winter, including filling their heating
oil tanks before it gets cold, and entering into fixed price heating oil
contracts or contracts that include a price cap where available and
appropriate.
? By preparing in advance, consumers can reduce the risk that they will
be burdened by higher heating fuel costs later this winter.
? Today's LIHEAP release will provide funds to all States to cover the
increase in fuel prices over last year. Funding allocations factor in
states? reliance on heating oil, natural gas and propane.
PRESIDENT CLINTON WILL ALSO DIRECT FEDERAL AGENCIES TO TAKE ADDITIONAL
STEPS TO REDUCE THE RISK OF HEATING OIL SHORTAGES THIS WINTER: Distillate
inventories, which include both home heating oil and diesel fuel, are at
unusually low levels as we head into the Fall. In the New England and
Mid-Atlantic, where heating oil is an important residential heating fuel,
inventories are currently more than 60 percent and 50 percent below last
year?s inventory levels, suggesting an increased risk of high heating oil
prices and shortages this winter. To reduce the likelihood and severity of
heating oil shortages, the President today directed:
1. Federal agencies to use all available means to fill their storage
tanks and contract for the purchase of distillate this winter as
early as possible.
? Filling storage tanks in advance of the heating season means that
additional heating oil supplies will not be required when colder
weather first returns later this Fall.
? By entering into long-term contracts with heating oil suppliers,
uncertainty currently affecting the industry will be reduced,
providing for a more stable heating oil market.
2. DOE to meet with representatives of state and local governments to
encourage them to follow the Federal government?s lead and fill their
storage tanks and contract for the purchase of distillate this winter as
early as possible.
3. DOE to work with state utility commissions to ensure that factories
and businesses with interruptible contracts for natural gas that
use heating oil as a backup fuel keep adequate heating oil reserves on
hand. Natural gas customers with interruptible contracts obtain
cheaper natural gas in exchange for service interruptions when the weather
is cold and natural gas demand peaks. Many rely on heating oil
as a backup fuel when their natural gas is cut off. Encouraging them to
maintain backup fuel on hand will keep them from entering the
heating oil market all at once when their natural gas service is
interrupted. Therefore, it will reduce the risk of demand spikes
that affect the prices paid by all heating oil customers.
4. The Environmental Protection Agency to work with States to review
their air quality implementation plans, and to create flexibility to
adjust State sulfur content restrictions on home heating oil in a manner
that safeguards the environment. This will make it easier to build
heating oil inventories this winter. Refineries that produce the lowest
sulfur heating oil are currently operating near capacity. By
creating flexibility in how States meet their sulfur standards, domestic
and foreign refineries would have the ability to produce more
heating oil and help build stocks faster;
5. The Secretary of Energy to meet with representatives of the National
Petroleum Council to discuss heating oil production this winter and
fall, to encourage the industry to take measure to maximize heating oil
production.
PRESIDENT CLINTON WILL CALL ON CONGRESS TO ENACT KEY PARTS OF HIS ENERGY
POLICY: President Clinton will renew his call for Congress to authorize
permanently a home heating oil reserve with an appropriate trigger. The
release of heating oil from the regional reserve that the President
established in July using existing administrative authority is governed by
current law. The President believes, however, that a permanent home
heating oil reserve in the Northeast needs a trigger for its use that is
more appropriate to possible regional shortages than current law permits.
Congress must also pass the President?s energy tax package and budget
initiatives, which would help families and businesses buy fuel-saving cars,
energy efficient homes, buildings, and appliances, and would accelerate the
research and development of cleaner, more efficient energy technology in
order to ensure that America has a secure energy future for the 21st
century.
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