Eleven Eastern governors are expected to approve a blueprint for slashing carbon dioxide emissions from cars -- and perhaps home furnaces -- before January, according to state officials, potentially sparking a widespread shift to residential heaters that burn wood pellets.

Officials in states from Maine to Maryland are preparing the outlines of a regional plan that would limit the amount of greenhouse gases a unit of fuel, like a gallon of gasoline, could emit. That's meant to prompt oil companies, refiners and motorists to use cleaner fuels made from trash and plants and renewable electricity.

Emission reduction targets are not yet established, but officials are basing preliminary calculations on a goal of cutting carbon 10 percent by 2020. That's identical to California's pioneering low-carbon fuel standard.

The Eastern program could be strikingly different in one way: More than 1 million homes in the region are heated with oil, more than anywhere else in the country. It could be a controversial task to regulate the fuel that keeps New Englanders warm during long winters.

But the alternative is just as troubling: Oil-burning furnaces consume more fossil fuel there than diesel-driven trucks. If heating emissions are not reduced, they could undermine the clean fuel standard -- and perhaps make the states unable to meet their existing global warming goals.

"A critical decision will be whether to limit the program just to transportation fuels or whether to also include heating fuel," said Michelle Manion of Northeast States for Coordinated Air Use Management, a nonprofit research group involved in designing the plan.

'Difficult' to cut emissions without addressing heat

In Massachusetts alone, about 963,000 homes -- almost half -- rely on oil heat. They consume 2 billion gallons of carbon-rich fuel every year, accounting for almost 20 percent of the nation's heating oil. New England burns 4.6 billion gallons of the stuff annually. That amounts to almost 15 percent of the region's petroleum use.

So there's concern that if heating oil is not included in the fuel standard, the 11 states might not be able to meet their individual emission reduction targets. All of them have promised to cut carbon.

"We are looking at whether we would be able to meet our goals without including home heating oil," said Rebecca Ohler, a supervisor with the New Hampshire Department of Environmental Services and a participant in the plan's design. "I do think it would be difficult."

Another contributor, Ellen Pierce, an analyst with Connecticut's Department of Environmental Protection, said heating oil is "a significant contributor to air emissions."

"It's something we should look at," she added.

Limiting emissions from transportation fuel is already daunting. Adding furnace fuel vastly increases the complexity of whom to regulate and how. Scores of additional businesses would fall under the watch of state regulators, probably prompting stronger opposition when state legislatures begin considering the plan for approval.

Politicians could become squeamish if the fuel standard is perceived to hike home heating bills during Northern winters.

'Cheaper' heat could mean widespread upgrades

But that may not be the case, said Nancy Seidman, deputy assistant commissioner for climate strategies with the Massachusetts Department of Environmental Protection.

"If folks switch to wood or a different fuel, then in some cases, it may be cheaper or more efficient," she said.

The report emphasizes the states' home-grown opportunities. Wood pellets could be culled from the forests and manufacturing sites of Pennsylvania, New York and other states, reducing lifecycle greenhouse gas emissions associated with extracting, refining and transporting oil around the world.

But that raises an infrastructure question. Thousands of homes might have to replace oil furnaces with wood-burning heaters. Other options exist, like using renewable electricity to heat homes, switching to natural gas or running oil furnaces on cleaner mixes of biofuels.

"The use of woody biomass and electricity as substitutes, combined with increased natural gas use for space heating, provides near-term low carbon fuel options for the Northeast," according to a 233-page analysis (pdf) released last month by the Northeast States for Coordinated Air Use Management.

That assertion could cause waves. Energy is expensive in New England, and residents could find new costs associated with replacing furnaces unappetizing. State officials are just beginning to model the economic effects of the plan.

Oil sands could cause havoc

The Energy Consumers Alliance of New England supports state initiatives aimed at replacing heating oil with low-sulfur diesel, a cleaner fuel. But the program's main thrust is to reduce the cost of oil by pooling the buying power of 17,000 households. That's not exactly an incentive to produce less emissions.

"The green they're interested in saving is their own," said Phil Lindsay, who runs the group's oil program.

The plan could be up and running in two years, said coordinator Manion. The governors from all 11 states -- including big polluter Pennsylvania -- are expected to sign a memorandum of understanding this year that establishes the broad strokes. Each state would then have to approve the program through legislation or executive order.

If emissions were reduced 10 percent by 2020, that would prevent 30 million tons of carbon dioxide from entering the atmosphere every year. That's without cleaning up home heating systems. Even so, it's still a bigger impact than that of the nation's first regional cap-and-trade program, the Regional Greenhouse Gas Initiative, which is reducing emissions from 233 East Coast power plants.

If home heating is not regulated, it could spur an influx of high-carbon petroleum from Canada's controversial oil sands, analysts warn. Refiners could direct Canadian bitumen into residential oil tanks, even as that emission-heavy fuel is being blocked from entering cars by the low-carbon fuel standard.

That could undermine emission targets, and the "carbon intensity of the region's fuel supply could rise significantly," according to the states' official analysis. Currently, about half a percent of the region's home heating supply comes from Canadian oil sands.

Copyright 2009 E&E Publishing. All Rights Reserved.