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A residential propane tank in Illinois, which is one of the Midwestern states enduring a propane shortage. Photo: <a href="">Jason Matthews</a>, Creative Commons, some rights reserved
A residential propane tank in Illinois, which is one of the Midwestern states enduring a propane shortage. Photo: Jason Matthews, Creative Commons, some rights reserved

North country feels the propane pain

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It has been hard to keep the house warm this winter. Record low temperatures have sucked up the various fuels we use for home heating - oil, wood, electricity. It's been particularly hard for people who rely on propane for heating their homes.

North Country residents who use propane are feeling the effects of a nationwide snafu between supply and demand.

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Reported by

Zach Hirsch
Reporter and Producer

For some people, a propane tank brings to mind a summertime barbecue. For others, propane is something that’s much more vital.

"In our house we use it to cook," said Joyce Sheridan, a secretary at St. Lawrence University. "Our heat, our dryer, and our hot water heater – so everything in our home is used by propane."

Sheridan and her husband live outside the Village of Canton. They use propane because their house, like a lot of rural homes, isn’t within reach of a natural gas line.

Since the fall of last year, Sheridan and her husband have started to pay more and more for their fuel every month.

"From last month to this month, it went up 25 cents a gallon."

For Sheridan, that’s an 11 percent increase. She says she’s normally ordering over a hundred gallons at a time, so the 25 cents adds up. She’s one of millions of Americans who are experiencing this kind of spike in their heating bill. In the Midwest, it’s even worse. Price per gallon of propane has gone up by a whole dollar.

"It’s not just that the cold snap drove up demand and we have this huge problem," said Steven Horowitz, an economics professor at St. Lawrence University. "That’s certainly a big piece of it, but it’s not the only one.

His propane bill has gone up, too.

Horowitz says the surge in price comes from several factors converging all at once. Farmers use propane to fuel heaters that dry their grains. 2013 was a particularly wet harvesting season, so farmers were using a lot of propane to dry their crops.  

Meanwhile, a major propane pipeline was closed for repairs. And then it got really, really cold.

Horowitz says there was also another reason for the unusually high demand.  

"You know, one of the things that was happening, was a lot of propane was being exported. Sellers were able to get better prices abroad than here at home," he said.  

In fact, propane exports have quadrupled over three years. Critics of the industry are blaming those exports for jacking up prices here at home. The industry says exports aren’t the problem.

Crystal Smith, a spokesperson for the New York Propane and Gas Association, says there really isn’t a shortage at all.

Smith has been trying to reassure the public, that in the areas where propane is produced, like in the Gulf Coast, the supply is still there, but the trouble has been getting it where it needs to go. The actual shortages are taking place among local retailers, mostly in the Midwest.

Those retailers aren’t making money off of the price surge. It’s a scare for them too.

Dan Reily manages HomEnergy Services in Saranac Lake.

"So what it means is, instead of saying, ‘Hey, I’m going to need a load of propane next week, or I’m going to need two loads of propane next week,’ we’re looking out six weeks," Reily said. "Common sense caution would advise that you try to get your orders in well ahead of time."

Reily says his business has been able to get propane, but he and all of his customers have had to pay more for it. He’s waiting for the spring, when temperatures rise and people aren’t relying so heavily on propane to stay warm.

Electricity has also been costly this winter. But utility customers in New York will get some help on that front.

Yesterday, the New York State Public Service Commission announced that National Grid can give temporary credit to its customers, to keep electric bills from spiking too high.

Meanwhile, propane prices are expected to remain at unusual highs across the United States. 

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