Infrastructure & Environment

What Are States Doing About Their Propane Shortages?

January 30, 2014
 

Supply problems in several states where propane is a crucial heating source have prompted governors and other officials to take action against vendors, investigate claims of price gouging and increase aid to low-income customers.

The propane drain coincides with extreme cold temperatures in several Midwestern and Southern states where residents and business owners are struggling to keep heating tanks filled as a result of increased costs or supply cut-offs.

“The industry as a whole should have been prepared for this,” Missouri state Sen. Mike Parson said Wednesday. He is urging the Justice Department to investigate rising prices in his state.

National supplies of propane were depleted by a late harvest that increased demand from farmers who needed to dry an unusually large amount of grain before storage. As colder-than-normal temperatures spread across much of the country, supplies fell to the lowest level ever the second week of January.

The national average price for a gallon of propane spiked this week to a little over $4, up from $2.96 the previous week, according to the U.S. Energy Information Association. About 5.5 million homes, mostly rural, are heated with propane.

Kentucky’s attorney general was granted an injunction against a major propane supplier that had stopped delivering to commercial customers in several states. The court order allows customers of Paducah-based United Propane Gas to get their tanks refilled from other sources without the company’s permission. Calls to the company were not returned Wednesday.

Minnesota and Wisconsin officials this week boosted aid for low-income residents who have been unable to refill tanks as prices spiked. Georgia Gov. Nathan Deal signed an executive order prohibiting price-gouging, and Indiana Gov. Mike Pence asked farmers and others to return unused propane to suppliers. Lawmakers in Illinois were drafting legislation that would help low-income families buy propane by increasing the number of families eligible for energy assistance.

Wisconsin Gov. Scott Walker said he would address the propane shortage with President Barack Obama during a presidential visit to the state today.

Last week, dozens of states, including Tennessee, loosened transportation rules to allow for extended hours for propane haulers to make deliveries.

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