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Propane shortage hits Maryland residents

House Building

When 89-year-old Waunita Ohler had to make three calls this winter to her propane supplier for emergency deliveries to avoid running out, the Elkridge mobile home park resident knew there was a problem.

What she didn't realize was its scale: A national shortage caused by what some call a "perfect storm" of factors has affected millions and sent prices soaring by more than two-thirds.

"Deliveries have been late in the past, but never have I run out of gas this way," said Ohler, who has used propane for cooking and to heat her home for 28 years. "I did not realize that there was a shortage, and I was angry with my gas supplier for letting me run out."

Propane is a combustible gas that can be compressed into a liquid form. It's uses include heating homes, powering forklifts and lifting hot-air balloons, but it represents a relatively small share of the Maryland's overall energy consumption. About 2.5 percent of the state's 2.2 million households use the liquefied petroleum to heat their homes, according to the 2011 Maryland Energy Baseline Study, which tracked energy use in the state.

Among mobile home residents like Ohler, the portion is much higher: 49 percent.

"Everybody's worried about it … because you need it for the heat," said Norma Brown, 77, of Deep Run Park in Elkridge. "They want to know are we going to run out, if that affects us."

Signs of the shortage date to last year, when two pipelines went offline, while a wet fall in the Midwest disrupted the harvesting season and caused a spike in demand for propane, commonly used to power crop dryers. Meanwhile, exports of propane have increased faster than production, with 20 percent of supply sent to other countries in 2013, compared to 5 percent in 2008, according to the National Propane Gas Association.

Low inventory forced Midwestern suppliers to look further afield just as winter set in, increasing the need for fuel and dumping snow on the roads, making deliveries more difficult.

"It's a logistical perfect storm really," said Sean Underwood, chief operating officer of Poist Gas Co. in Laurel, a family-owned firm that has about 5,000 customers in Central Maryland.

A 3,000-square-foot, single-family home in Maryland will use about 800 to 1,000 gallons a season, although that number will likely climb to 1,300 or 1,500 gallons this year because of the cold, he said.

To meet the needs of its customers, Poist Gas is ordering propane from as far away as Louisiana, Underwood said.

"It's not as bad as the Midwest, where there is physically no fuel, but we have slowly become in the same position as them," he said. "It's not as bad, but we're feeling the same problems that they've been feeling longer."

The supply problem has forced the country's largest propane company, Amerigas, to redirect gas, people and transport vehicles from less-affected areas, such as the West Coast, said spokesman Simon Bowman. The company is also rationing deliveries in some places, filling customer tanks to 60 percent instead of all the way.

"We're repurposing all of the assets we have to help meet this demand," Bowman said. "Our No. 1 priority is making sure that we have adequate supply to meet the needs of our customers."

In January, the Federal Motor Vehicle Carrier Safety Administration signed emergency regional orders for Maryland and more than 20 other states, lifting rules that limit the time truckers can spend on the road, to help with deliveries of propane and other heating supplies.

In some states, politicians have called for investigation of the problem.

Abigail Ross Hopper, director of the Maryland Energy Administration, said state suppliers have largely managed to keep pace with demand, but users here still will be hit by skyrocketing prices.

The cost of residential propane, which stayed below $2.40 per gallon last winter, fluctuating by less than 20 cents, has soared to more than $4 per gallon, jumping a dollar in the week of Jan. 20 alone, according to the Energy Information Administration..

"I think people will probably get their bills and say, 'Holy cow! I've got to do something about this,' " said Hopper, adding that her staff is working with utilities and suppliers to make sure customers have payment plans available to them. "This is a problem across the country and so it's kind of a cascading effect. ... Supply is definitely tight."

Companies are asking propane users to limit energy use, reorder before tanks run too low and clear areas of snow for easier delivery. The problem, experts said, isn't going away.

"This isn't a speculative problem where people are on paper pushing prices up. It's a fundamental supply problem, and the logistics won't get better until the demand gets lower," Underwood said. "If things are much colder than normal well into March or April, then the problems will continue to be as bad as they are, and they won't get any better."

That's scary for people like Ohler. In prior years, her supplier delivered based on the weather and prior consumption. But for five months, Ohler said, deliveries have come irregularly and, even then, don't completely refill her two 100-gallon tanks.

"To wake up at 89 years old to a 60-degree house is not fun," she said. "It's a dire emergency for me and I'm sure other people."

nsherman@baltsun.com

A previous version of this article misspelled the name of the director of the Maryland Energy Administration. Her name is Abigail Ross Hopper.

Copyright © 2014, The Baltimore Sun
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