Preparing for the possibility of a propane pinch - WPSD Local 6: Your news, weather, and sports authority

Preparing for the possibility of a propane pinch

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Fulton, Ky. - Making a plan for propane now could pay off later to keep your family out of the cold. Ohio Valley Gas District Manager Kenneth Prince said, "We have so many people telling us that they don't want to get into the same problem they had last year."

The 90 degree temperatures outside have a lot of people talking about AC, but propane industry experts said this is actually the time to think about your heat. Demand is low right now, and that means prices are too.

Last winter, though, people were paying up to $6 a gallon in some places. Many companies across the nation were running low on propane. Some of them even stopped making deliveries, or used contract language to charge market price for customers who had locked-in rates.

Local companies are offering programs now that they say can help keep you out of a propane pinch this winter. They say the worst thing you can do is wait.

Prince said, "Our guys are working five days a week, all day long, some times 10 hours a day to meet the demand." When it's warm outside, it's the right time to buy. "Typically in the industry, the price is best in July, August, and early September, because demand is low," Prince said.

A tank holding about 120 gallons of propane would cost about $200 to fill all the way up considering summer fuel prices. But, if you wait until winter and things happen the year like they did last year, it could cost up to $700 to fill the same tank. Prince said, "Without a doubt, last writer was the worst winter I've seen as far as the demand and the shortage."

The best thing people can do is prepare, Prince said. "Get your tank filled up now. That way you can take advantage of that low price." But, he knows there are some things that affect propane supply, demand, and price that no one can predict. "At Ohio Valley Gas, we have never not honored a contract or a price," he said, "Now that's not to say that if we had a catastrophic natural disaster, that that wouldn't happen. But, it's highly unlikely."

He said the company, unlike last year, is going into the winter with their storage full. He suggests you do the same thing. "People are preparing better this year than I've ever seen. I think that's a very smart thing to do," he said.

A lot of propane companies in our area are offering contract programs for the winter, right now. At Ohio Valley, you can pre-buy your propane and pay  for it up front. That rate will be higher than the current market price, but you won't be subject to any increases.

Customers also have the option to get a price-lock contract for propane, also at a higher rate, but it won't change. Ohio Valley also has a budget plan that Prince says is the most popular. People will be subject to price changes, but you can spread payments out over one year.

The fine print in many contracts does not require propane companies to honor prices or deliveries in certain circumstances. The summer fuel price is under two dollars a gallon, and anyone can get a fill up for that rate right now.
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