Propane Education & Research Council Statement on Propane Supply and Distribution
WASHINGTON (January 30, 2014) — Record cold temperatures across the country, and particularly in the Midwest, have created an unprecedented surge in demand for heat and higher energy costs across the board, including electricity, heating oil, propane, and natural gas.
The propane industry is continuing to work around the clock to get propane from storage and production facilities to customers who need it. Keeping families and businesses safe and warm is the propane industry's first priority.
Members of the propane industry, led by the National Propane Gas Association and state associations, are working with federal, state, and local officials on several measures to help expedite propane deliveries:
• Working with transportation partners to ensure all available transport tankers, delivery trucks, railcars, barges, and pipelines prioritize propane deliveries.
• Moving international supplies of propane by ships to ports in the Northeast.
• Reaching out to state and federal authorities to open up more transportation options for propane, including extending hours-of-service exemptions that allow drivers to move propane more freely, and easing frost laws that limit a truck’s maximum weight (a restriction that others such as trash trucks are exempt from already).
• Urging governors in affected states to consider declaring an Economic Injury Disaster that would trigger loan programs to enable propane retailers to replenish propane supplies.
• Coordinating with the Energy Department to acknowledge that emergency conditions could be forming in regions hit the hardest, particularly in the upper Midwest.
As an organization focused on research, the Propane Education & Research Council (PERC) has initiated several studies to actively assess the infrastructure and market factors contributing to today’s situation. At a time when U.S. propane production is at an all-time high, PERC wants to know what can be done to ensure that propane can be quickly and affordably put to use here at home, even during times of extreme weather. In order to do that, it will explore a variety of factors:
• Transportation Infrastructure: The December shutdown of the Cochin pipeline in the upper Midwest coupled with the reversal of another Midwest pipeline that previously transported propane contributed to that region’s tight propane supplies. As supplies from natural gas and crude oil increase, so has competition for pipeline access and resources. Measures must be taken to ensure that the proper infrastructure is available to move propane from large national storage facilities to local propane retailers, especially in the winter.
• Storage: The majority of the large propane storage facilities are located outside the Northeast and Midwest where most propane is used. Increasing local storage capacity in these regions would enable quicker response to increased demand but often requires overcoming local political and perceptual hurdles.
• Exports: The U.S. is producing ample propane supply, but more is being shipped overseas than ever before. In 2013, more than 20 percent of U.S. propane production was exported, up from 5 percent in 2008. Increased exports have made a large portion of these stockpiles unavailable for domestic use.
The good news for propane is that the long-term supply picture is positive, the logistical and transportation challenges we’re experiencing today can be overcome, and spring is on the way. As extreme weather subsides, prices should stabilize and the market should reflect that abundance. PERC is taking a hard look at the current situation to advise on what can be done to better meet the needs of customers moving forward.
In the meantime, PERC continues to offer these reminders to ensure their families and businesses are taken care of:
• Call to schedule a delivery when your tank is 35 percent full. Doing so should give the propane retailer enough time to reach you before you run out of gas.
• Use energy wisely and conserve propane when you can.
• Keep a path to your propane tank clear. Doing so helps propane delivery drivers get to your tank easily, refill it quickly, and get to the next home.
• Leave the grill outside. Never bring outdoor grills inside for heating or cooking. They are made for outdoor use only; if brought indoors they pose a safety risk.
• Check to see if you’re eligible for help with paying your propane bill. The Low-Income Home Energy Assistance Program, also known as LIHEAP, helps qualifying families pay their heating bills. To learn more call 866-674-6327 or visit http://liheap.ncat.org/db/.
About PERC: The Propane Education & Research Council (PERC) is a check-off program established, operated, and funded by the propane industry. The only energy council of its kind, PERC leads safety and training efforts among propane retailers and consumers and drives technology development to expand adoption of propane as a clean, domestic, and affordable energy source. PERC programs benefit a variety of industries including fleet vehicle management, landscaping, residential and commercial building, agriculture, and material handling. For more information, visit propanecouncil.org.