Heating Oil Loan and Grant Program

The Heating Oil Loan and Grant Program is administered by the Washington State Pollution Liability Insurance Agency (PLIA), a Washington state agency that oversees environmental pollution liability and cleanup assistance programs. The Washington State Legislature authorized the program in 2020 under Chapter 70A.345 RCW to assist residential and property owners with aging heating oil tank systems that may present environmental contamination risks. The program was transitioned from the former Heating Oil Insurance Program into the Heating Oil Loan and Grant Program beginning July 1, 2025. The program is intended to reduce environmental contamination, protect groundwater and public health, and help homeowners address expensive cleanup and infrastructure replacement costs associated with heating oil tanks. The program guidance explains that many heating oil tank owners lack sufficient pollution liability insurance coverage for leak cleanup costs, making state assistance critical for remediation and prevention activities. The program provides a combination of grants and loans with total financial assistance capped at $75,000 per project site. Funding may support environmental investigation activities, leak cleanup, tank removal, infrastructure replacement, and installation of alternative heating systems. Participants may first receive a Preliminary Planning Assessment grant of up to $7,000, which pays for a PLIA-assigned consultant to assess contamination, determine cleanup needs, and prepare cost estimates for corrective actions or heating system upgrades. If contamination is identified, applicants may qualify for cleanup grant funding of up to $60,000 to cover expenses such as permits, tank removal, soil and groundwater testing, vapor testing, and contaminated soil removal. Loan funding may also be available for cleanup costs exceeding grant awards, tank decommissioning, infrastructure upgrades, replacement heating systems, and installation of new heating oil tanks or alternative heating sources such as heat pumps. Loans may be issued for up to $68,000 when no cleanup grant is required, or for the remaining amount under the $75,000 cap when combined with grants and assessment costs. Eligible applicants must own the property where the heating oil tank is located or where a historic heating oil leak occurred. Applicants must submit a complete application through PLIA's Online Community during an open application cycle. The program operates application cycles twice annually, typically during May through June and November through December, with each cycle remaining open for 45 days. The current 2026 spring application cycle opened prior to May 13, 2026 and remains open through June 18, 2026. Applicants must demonstrate that their property either contains a heating oil tank or has contamination from a historic heating oil leak that requires cleanup. Eligible activities include leak cleanup, tank removal, infrastructure replacement, conversion to another heating source, or decommissioning a tank in place. Applicants requesting loan assistance for infrastructure improvements or heating system replacement must provide personal or business financial documentation for review by the Washington State Department of Health. Required documentation may include tax returns, W-2 forms, bank account information, debt obligations, business records, and insurance information. The application and review process involves multiple state compliance and environmental review requirements. Following submission of a complete application, PLIA conducts an initial review within approximately 30 business days after the application cycle closes. Accepted applicants must complete a State Environmental Policy Act checklist and provide property access for environmental assessment activities. PLIA also conducts consultation with the Department of Archaeological and Historical Preservation and affected tribal nations to evaluate cultural resource impacts associated with state-funded projects. Once these reviews are completed, participants receive formal program acceptance and the Preliminary Planning Assessment process begins. The assessment may involve soil, groundwater, and vapor sampling, installation of monitoring wells, evaluation of cleanup alternatives, and development of remediation or infrastructure upgrade plans. If a leak is discovered during the assessment, participants are enrolled in PLIA's Technical Assistance Program, which provides technical guidance toward achieving environmental cleanup standards and obtaining a No Further Action determination. Funding awards are prioritized according to environmental risk and cleanup needs. PLIA ranks projects into tiers that prioritize leak cleanup and tank removal before infrastructure upgrades alone. The agency also uses Washington state's environmental health disparity scoring system to prioritize vulnerable and overburdened populations. After assessment activities are completed, PLIA conducts a financial offer meeting with participants to review project scope, funding eligibility, and draft loan or grant agreements. Participants have 30 days to accept or decline funding offers. All cleanup or construction work must be pre-approved by PLIA through an approved work plan before project activities begin. For cleanup grant-funded work, PLIA directly hires and pays consultants. For loan-funded infrastructure work, participants may select their own contractors, provided those contractors are registered as statewide vendors. Monthly progress reports are required throughout project implementation, and all invoices must be submitted through the Online Community system. Loans issued under the program are generally structured as 30-year loans using the prime interest rate established on March 1 of the application year. Participants may qualify for a 0.5 percent interest reduction if they install energy-efficient infrastructure. The program also includes repayment flexibility through deferment, forbearance, loan modification, and limited forgiveness provisions for borrowers facing financial hardship. Funding may be suspended or terminated if participants fail to comply with agreement requirements, if contractors deviate from approved scopes of work, or if state funding becomes unavailable. Contact information for the program includes PLIA's primary email address at pliamail@plia.wa.gov and phone numbers at (360) 407-0520 or (800) 822-3905. Additional guidance and application materials are available through PLIA's official website and Online Community portal. The program guidance document is available at the official PLIA PDF source.

Submit a fully complete application before the deadline because incomplete applications may be denied. Ensure all environmental review steps and financial documents are submitted promptly. PLIA requires all cleanup and construction work to be pre-approved before costs are eligible. If contamination is identified, cleanup and tank removal must occur before heating system changes are made.