Sign In | Create an Account | Welcome, . My Account | Logout | Subscribe | Submit News | Contact Us | Home RSS
 
 
 

Cold temps yield higher propane prices

Local dealers have supplies, but costs to consumers have tripled

February 6, 2014
By Clay Schuldt - Staff Writer , The Journal

NEW?ULM - Minnesotans have experienced cold winters, but this year has taken a heavier than usual toll. One area hit hard by the cold weather is the shortage of propane fuel.

Recently Gov. Mark Dayton expanded the Low Income Home Energy Assistance Program (LIHEAP), allowing households earning less than 60 percent of the state's median income to qualify for energy assistance. However, with growing demands for propane Dayton has appealed to the federal government to provide further funding to prevent LIHEAP from running empty.

Many suppliers have been effected by the shortage of propane, which is used to heat homes in rural areas not supplied by natural gas.

"We've got supply, it's the cost" said Kevin Subart of the River Region Co-op in Sleepy Eye. Subart explained that Minnesota is being supplied with propane, but because the demand is high the price per gallon has tripled in the last month. No one is to blame for the increase in propane costs, he said. It is simply a culmination of factors causing the soaring prices, the weather being the main reason.

Bruce Beussman of South Central Grain & Energy, confirmed that propane prices spiked in January, saying prices were higher than he has seen in more than a decade.

According to Beussman, the supply of propane began going down during the fall due in part to the damp weather, prompting farmers to increase fuel usage to dry crops. With cold weather hitting Minnesota early in November the supply of propane had little time to recover.

Adding to the problem is the fact that Minnesota is not the only state hit by the cold weather. Every region in the cold belt has been hit . The result is much of the propane usually headed for Minnesota being redirected to other parts of the nation. Other factors include the shutdown of the Alberta pipeline in early December and difficulties with delivering propane due to poor road conditions.

Recently the Federal Motor Carrier Safety administration agreed to an extension of the "hours of service" wavier. This measure will increase the number of driving hours for truckers and allow for increased propane deliveries to areas in need. Other solutions include asking Minnesota farmers with a surplus of propane to sell it back to suppliers. In order to combat future propane shortages, 1st District Rep. Tim Walz has suggested creating a propane reserve.

Area propane suppliers are doing the best during a difficult time. Subart explained that the River Region Co-op has recently relaxed penalties on minimum supplying. This means customers will not incur extra cost for only filling propane tanks to 50 percent.

Beussman is cautiously optimistic about the propane crisis, saying "I feel better about the supply now than I did two weeks ago."

Currently both South Central Grain & Energy and River Region Co-op are fully supplied with propane. However, as the winter season winds to a close, propane remains a commodity no one wants to take for granted.

 
 

 

I am looking for:
in:
News, Blogs & Events Web