Propane prices head up
The Iowa Department of Agriculture released its weekly heating oil and propane price report yesterday. The average price of propane went from $4.18 last week to $4.70 yesterday, which has caused people to take notice.
Jarad Klein, R-Dist. 78, said the increased pricing has a lot to do with the number of exports of liquid propane [LP] that have gone overseas and the shortage the United States is seeing due to a colder winter this year.
“The feds have raised export limits the last three years,” he said. “We are producing more LP than ever before and the dollar is weak, resulting in this ‘perfect storm.’ Add into that, the long drying season [for crops] and cold weather; we end up with LP over $5.”
Klein uses LP on his farm near Keota.
“I use it to heat my hog buildings, in the fall to dry the crops, and to heat my home,” Klein said.
He buys propane by the gallon from a local provider in Keota. He said most rural homes have tanks that hold 500 to 1,000 gallons of propane, like his. He has heard from concerned constituents about the LP prices but said there isn’t much the state can do right now.
“We have raised weight limits for trucks and are working with other states to bring in more LP,” he said. “We will also keep a watchful eye to ensure no price gouging [is happening].”
Mike Gerst, president of the Iowa Propane Gas Association (IPGA), and manager of propane operations of Farmers Co-op in Richland, said his customers were aware of the propane shortage.
“They’re frustrated,” Gerst said. “But we’re doing as much as we can to work with them and they’re working with us, too.”
As president of the IPGA, Gerst was in Des Moines yesterday to speak with state legislators about the increase of cost for LP and the shortage. He echoed what Klein said about what can be done.
“They’re [state legislators] doing everything in their power, but not much can be done,” Gerst said.
The IPGA asked legislators yesterday to support additional funding for the federal low-income heating energy assistance program (LIHEAP), said a press release from the group. An emergency bill is supposed to be filed this week by state legislators asking for an additional $1 million.
Klein said he hasn’t seen the bill come across his desk yet.
“It would be difficult to ask for more assistance because at this point we don’t even know what’s needed,” he said. “It’s mostly going to have to come at the federal level.”
Yesterday, Gov. Terry Branstad and Lt. Gov. Kim Reynolds sent a letter to President Barack Obama asking Obama to have his administration look into the propane shortage and offer some sort of assistance to Midwesterners, according to a press release from the governor’s office.
In the letter they asked the Department of Transportation (DOT) to expand the exceptions for hours of service, which would lengthen delivery hours for customers who use LP. The letter also asks for the U.S. Department of Energy to reduce regulations on how LP can be shipped. They suggest all modes of transportation for delivery, including using railroads and pipelines.
There are some things customers can do to help conserve LP, the IPGA said in its press release. They suggest customers lower their thermostat five to 10 degrees, reduce hot water usage if customers use a propane hot water heater, don’t heat any rooms or buildings that don’t have to be heated, reduce use of the propane stove, and don’t call the propane provider until the gauge reads below 25 percent.