The New Jersey Department of Environmental Protection last week officially unveiled proposed rules that would reduce the sulfur content in heating oil.

The proposal was contained in a public notice published in the New Jersey Register dated Nov. 16. The move comes ahead of the public hearings scheduled for Jan. 5, 2010, in Trenton.

The changes sought would lower the sulfur content in No.2 heating oil and other middle distillate fuels sold and used in the state, which would reduce their emissions.

The department says the proposed rule is part of its efforts to improve air quality by lowering the level of allowable sulfur in fuels sold and used in the state and would make New Jersey a leader in the Northeast in this area.

Currently, most U.S. heating oil has a sulfur content level of about 2,000 ppm. New Jersey’s proposal would cut that to 500 ppm on July 1, 2014, and then to 15 ppm on July 1, 2016.

A similar move by New York a few months ago triggered a response by the CME Group, which offers a heating oil futures contract trading on the New York Mercantile Exchange platform with a N.Y. delivery point. The exchange operator said it would not list new heating oil futures contracts beyond August 2012 amid the potential for a specification change in the underlying physical product.

New Jersey’s notice says, “the NJ Department of Environmental Protection is proposing to amend its rules at N.J.A.C. 7:27-9, Sulfur in Fuels, specifically N.J.A.C. 7:27-9.2, to lower, and thus make more stringent, the maximum sulfur content standard and maximum sulfur dioxide (SO2) emissions standards for fuel oil sold for use in New Jersey.”

“Both the existing and the proposed amended standards are based on the grade of the fuel oil; that is numbers 1, 2, 4, 5 and 6 grade fuel oils. The Department is proposing a first phase of more restrictive maximum sulfur content standards for all grades of fuel oil (except No. 5, No. 6 and heavier grades in Zones 3, 4 and 6), to take effect July 1, 2014.

“This includes reducing the sulfur content in No. 2 oil (home heating oil) and lighter grade fuel oil from over 2000 parts per million (ppm) to 500 ppm in the first phase. The Department is also proposing a second phase of more stringent maximum sulfur content standards to 15 ppm for No. 2 and lighter grade fuel oil, to take effect July 1, 2016.

“Analogous changes to the maximum SO2 emissions standards, would also be effective July 1, 2014 and July 1, 2016. The proposed amendments affect those who store, offer for sale, sell, deliver or exchange fuel oils for use in New Jersey, as well as the users of these fuel oils,” states the notice.