October 5th - 2005

Warm up to oil heating

Dirty, smelly and expensive; these are three common misconceptions about oil heat about which the Canadian Oil Heating Association (COHA) would like to clear the air.

Dirty, smelly and expensive; these are three common misconceptions about oil heat about which the Canadian Oil Heating Association (COHA) would like to clear the air. The association is on a mission to improve the image of oil heat to one that invokes the image of “clean, efficient and modern.”

The association has launched a REALTOR Partnership Program on the Today’s Oil Heat web site (www.todaysoilheat.com) to give REALTORS exposure to over one million oil heat customers in Canada. By educating the public and REALTORS about the benefits of oil heat and the improvements the industry has made over the years, the COHA hopes to gain consumer confidence. That confidence has been shaken lately by much publicized concerns about underground oil tanks and insurance issues. The COHA says there’s a lack of good information out there so the public isn’t getting the whole story.

Even with international events and the effects of Hurricane Katrina and the concern these events are causing home owners about the costs of heating, the COHA maintains that oil heat is the best value for home heating. According to the COHA, oil heat is a lot cleaner than it was 25 years ago and today’s high-efficiency fuel oil appliances operate in the 85 per cent range with some ultra modern furnaces in the 95 per cent efficiency range entering the market. Emissions from oil burning equipment have been reduced to near zero levels and the industry says it has continuously decreased the amount of sulphur in fuel oil leading to better air quality.

COHA says oil heat creates no dirt, and no odour, and because it’s hotter than any other home heating source – one litre of oil gives off 37,000 BTUs – it’s more efficient than electricity, propane and even natural gas.

Insurance issues
The big concern for homebuyers and REALTORS, however, relates to obtaining homeowner’s insurance for houses that have older oil tanks. Oil leaks and spills from residential fuel tanks have cost Canadian insurance companies and homeowners a lot of money in recent years. Many insurance companies now balk at insuring homes with older fuel tanks, and some provinces have passed strict new regulations governing when the tanks must be replaced. The Insurance Bureau of Canada says that insurance claims from domestic oil tank leaks have increased by more than 50 per cent in the past ten years.

The COHA says concerns about leaking oil tanks are unfounded except in the case of aging underground tanks. “Today’s state-of-the-art tanks are composed of corrosion resistant steel, fibreglass and polyethylene,” says Merril Mascarenhas, COHA spokesperson. “That means long life and real safety.”

Mascarenhas adds that obtaining insurance on an oil-heated home is not a problem as long as the tanks and equipment have been properly inspected and maintained. “In our discussions with homeowners and REALTORS, we’ve discovered that people just don’t know enough about maintaining and upgrading their furnaces,” he says. “But if the equipment has been replaced recently and/or it’s had its regular maintenance check ups, everyone’s happy – the homeowners, the insurance company and the REALTOR.”

Selling an oil heated home
When selling a home that’s heated by oil, REALTORS should ask questions regarding the age of the oil tank, location and proof that the tank installation meets safety requirements. Buyers should expect to be asked, by their insurer, to provide this type of information when applying for insurance.

The COHA suggests REALTORS recommend an inspection of the oil heating equipment by a qualified home inspector prior to closing. The buyer should also contact the fuel oil supplier for the home and determine if the basic or comprehensive inspections of the tank and oil-heating appliance have been completed. The fuel oil supplier will have information about the servicing/inspection program that is in place for the home.

For more information about the benefits of oil heat, visit www.todaysoilheat.com. Also check out the Legal Pamphlets section on the OREA members’ website. Under “Select Pamphlet” choose “Underground (Buried) Fuel Oil Tanks” for information about Technical Standards Safety Authority (TSSA) requirements.

Fuel for thought
The Canadian Oil Heat Association (COHA) is working to change people’s opinion about fuel oil heating. Here are some of the ways they say oil heat has improved:

  • Ultra clean, near zero emissions– Modern, high efficiency furnaces and a reduction of sulphur in fuel oil means cleaner air indoors and out.
  • No-worry tanks– Tanks are now made of non-corrosive materials for longer life and safety.
  • Higher fuel efficiency– Today’s oil heat furnaces burn approximately 2500 litres per year, an improvement and savings of over 40 per cent compared to 30 years ago.
  • Long term savings– Adjusted for inflation, the price of oil heat hasn’t changed much since the 1950s. The cost of oil heat is also projected to rise at a lower rate than natural gas.
  • More hot water heat– Oil heat burns hotter and heats water up to twice as fast as natural gas and five times faster than electricity.
  • Safety– Oil heat is non-explosive. If exposed to a lit match the oil will not ignite.

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Ontario Real Estate Association

Jean-Adrien Delicano

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JeanAdrienD@orea.com

416-445-9910 ext. 246

Ontario Real Estate Association
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