Winter weather a challenge for propane delivery, but supplies remain ample
(The Center Square) – Wintry weather in parts of the U.S. has stalled propane deliveries, prompting at least two governors to relax trucking regulations.
Utah Governor Spencer Cox and North Dakota Governor Doug Burgum issued executive orders Tuesday that extended the hours truckers can make deliveries. The orders expire in 30 days.
“We can’t afford the kinds of delivery delays we’re seeing and we need to allow private sector solutions to occur,” Cox said in a news release. “This limited emergency declaration will help us get through this crisis.”
The orders do not allow motor carriers to require ill or fatigued drivers to make deliveries but says the carriers should give drivers 10 hours of rest if requested.
Cox and Burgum said propane inventories were low but that is not the case, Lesley Garland, vice president of state affairs for the National Propane Gas Association, told The Center Square. The issue lies with the delivery, she said.
"In some situations, we're waiting for snowplows to clear the road so that the trucks can get in and deliver to the customers," Garland said. "These waivers are helpful because it allows the safe extension of those hours for drivers on a limited basis and gives them extra time to move product where it needs to be."
No propane shortages are expected for the winter season, Garland said.
"In the absence of an extreme winter event, and that's always the caveat – Mother Nature could throw record-breaking cold at us for a record-breaking period of time and then we could have difficulties and challenges," Garland said. "But at this point, the supply experts that we work with are telling us that with the projections of the winter continuing as it has since the last month or two, it appears as though we are in good shape."
Propane is available, but it will be more expensive.
A report from the U.S. Energy Information Administration (EIA) showed global demand for propane coupled with low supply is leading to a price increase in the U.S.
"Relatively high international prices and strong integration between the U.S. propane market and the global market through exports have resulted in U.S. wholesale propane prices rising alongside prices in major international markets," according to the report.
The Winter Fuels Outlook from the EIA showed families and business owners that rely on propane are expected to pay an average of 54% more in energy costs this year than last year. The increase would be 94% higher if the winter is colder than expected, but the increase would only be 29% if the winter is warmer.
"The high prices follow changes to energy supply and demand patterns in response to the COVID-19 pandemic," according to the Winter Fuels Outlook. "We expect that households across the United States will spend more on energy this winter compared with the past several winters because of these higher energy prices and because we assume a slightly colder winter than last year in much of the United States."
The EIA will release a short-term energy outlook next week that will forecast propane production through 2023, EIA's Chris Higginbotham said.