Demand, shortages lead to high propane prices

10:07 PM, Feb 6, 2014   |    comments
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ELIZABETH - In the cold of winter, the battle over how to combat the rising cost of propane is heating up.

In a letter sent to Gov. John Hickenlooper on Wednesday, Republican State Senator Greg Brophy asked the governor to ease transportation requirements regarding the delivery of propane.

"I urge you to declare a state of emergency due to the scarcity of propane and spike in propane prices and grant an hours of service waiver to propane transportation companies," said Sen. Brophy, R-Wray, who is running against Gov. Hickenlooper. "Transportation waivers are already in place in many other states."

So far, the U.S Department of Transportation has granted 31 states across the country so-called "Hours of Service Relief" to allow for the expedited delivery of propane. A spokesperson for the governor said, while Colorado has been affected by the propane shortage, the situation appeared to be improving.

"The supply at the Conway, KS, storage facility is increasing, thus lowering price steadily... In-state production is also increasing, but is now limited by number of available trucks for distribution," said Eric Brown, director of communications for Hickenlooper, adding, "We continue to work on this distribution issue, including exploring waivers for how long a trucker can drive to increase truck distribution capacity."

Yet, for Pam Van Schaack, the bitter winter weather is leaving a bitter taste when it comes to her propane bill.

"We're going to freeze, because we can't afford that," she said. "I mean, that's ridiculous."

An Elizabeth resident and salon owner, Van Schaack says propane prices usually hover around $1.65 per gallon in the summer. However, she just found out from her propane provider that she can expect to begin paying a lot more now.

"Propane is going up to somewhere around $4.50 cents a gallon," Van Schaack said.

Her home propane tank holds 500 gallons. If it's really cold, she needs to fill up every few months at a new cost of $2,250.

"I just want to know what's going on and what's going to happen to these people out here that rely on this on a daily basis," she said.

Skyrocketing propane prices are widespread across the country. Those hit hardest in Colorado, often live in rural areas, where propane use is more common. Part of the problem is that an unusually cold winter is gripping much of the nation and leading to higher demand for propane. There's also another factor.

"The second reason is that natural gas prices have gone up-- and propane is a by-product of natural gas," said Stan Dempsey, President of the Colorado Petroleum Association.

Natural gas prices have been lower in recent years, when winters were warmer and demand was smaller.

"One of the things is that natural gas prices have been almost depressed and that's led to a slowdown in drilling, particularly in the Western Slope," Dempsey said. "So when there's a greater demand for natural gas that price spike feels a little bit more impactful."

It's an impact that's leading to sticker shock for people like Pam Van Schaack.

"There's a whole bunch of people out here that are going to pay a big price for this kind of thing," she said.

The price may not get any better until the weather warms up. The Colorado Petroleum Association said the best thing consumers can do in the long run is to weatherproof their home, so it uses energy more efficiently.

(KUSA-TV © 2014 Multimedia Holdings Corporation)

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