The propane industry – which produces alternatives to natural gas – has been experiencing some hard times recently due to shortages caused by recent cold (if not freezing) fronts in the Northeast and Midwest regions. This unfortunately has resulted in the occurrence of major price hikes and a decrease in supply chains.
According to the National Propane Gas Association (NPGA), there are various other reasons for the industry experiencing hard times including the weather (as mentioned above) and the increase of farmers relying on propane to harvest their fields after getting a late start this year.
In a recent statement made by Jeff Petrash; NPGA VP and general counsel, “Most people don’t realize that huge amounts of propane are used in grain-drying, so we had a large and later-than-normal grain harvest that called for large volumes of propane just as we were entering the winter heating season.”
While the production of domestic propane increased within the past year; it is still not enough and many retailers are finding it necessary to ration their supply in certain areas. What is being done to control the shortage of propane? To start the NPGA asked the federal energy regulator to order more supplies of the heating fuel.
The Federal Energy Regulatory Commission announced on Thursday February 6, 2014 that the NPGA has requested to use its emergency powers to order Enterprise – one of the largest exporters of propane – to supply 75,000 barrels per day of propane along its TE Products pipeline.
Other steps currently being taken by the NPGA can be found posted on their website. While it remains unclear to all parties involved (i.e. associations, retailers and consumers, etc.) just how long supply will be in tight supply, every action is being taken to reverse its effects.
Blog courtesy of Arizona Propane – (480) 990-2245