Written by Larry Limpf
February 11, 2014
State officials continue to address complaints about the price and supply of propane fuel.
Attorney General Mike DeWine’s office said it is “actively monitoring” complaints about price-gouging and that it plans to work with attorneys general in other states on possible anti-competitive activity related to the sale of propane.
About six percent of the Ohio’s population uses propane to heat homes, according to Census data.
“We want to assure Ohioans that we will carefully monitor reports of potential price gouging or other unfair business practices related to the extreme cold,” DeWine said.
Ohio doesn’t have a statute dealing directly with price gouging but state law bans “unconscionable sales practices,” he said, which could be described as a supplier knowing at the time of the transaction the price was substantially higher than the price at which similar goods or services could be readily obtained.
DeWine is having consumers contact his office when their tank is 10 percent or less full. A staff member will call the consumer’s supplier to determine why a fill has been delayed.
Suspected price gouging should be reported to his office by calling 800-282-0515.
The assessment room of the state’s emergency operations center has remained in operation to coordinate the response to counties affected by the shortage, said Tamara McBride, a spokesperson for the center.
An emergency declaration by Gov. John Kasich to allow commercial haulers of propane and heating oil to spend more time on the road for deliveries is scheduled to expire Feb. 16.
The U.S. Department of Transportation issued a similar declaration for interstate highways.
Congressman Bob Latta said he’s joined with other members of the Ohio congressional delegation to request the federal emergency exemption is extended past the Feb. 11 scheduled expiration.
In the Midwest, delivery and supply problems surfaced in the autumn when many farm areas had better than average yields of grain crops. Many fields, however, were wet, requiring large of amounts of propane for drying before storage.
The National Propane Gas Association last month issued a statement saying “infrastructure re-alignments” caused transportation problems.
“The Cochlin pipeline, which provided 40 percent of the product used by Minnesota suppliers, was shut down for repairs,” the statement said. “This triggered a chain reaction causing suppliers to go further out to load their supply.”
Another factor is the sharp increase in exports.
“In 2013, more than 20 percent of total U.S. propane was exported, up from 5 percent in 2008,” the NPGA said.
According to the Energy Information Administration, residential propane prices in Ohio rose from $2.86 a gallon on Dec. 30 of last year to $3.90 by Feb. 3. Wholesale price rose from $1.76 to $2.35 during the same time.
A statement on the Ferrellgas website says the situation is more accurately described as a “transportation issue.”
“The United States is currently producing more propane now than at any time in many years,” the statement says. “The challenge the industry is facing is moving propane from where it’s stored to the thousands of homes, farms and businesses that need it.”
The transportation issues have been compounded by record agricultural use, it adds.