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Widespread propane shortage leads to price spike
WEST MICHIGAN (NEWSCHANNEL 3) - There are growing concerns over a widespread propane shortage, and the Michigan Public Service Commission warns it's only going to get worse.
A Wisconsin facility that supplies fuel is shutting down for maintenance.
While the problem is bigger in the upper peninsula, concerns are reaching across the state, including West Michigan.
Adding to the list of problems, customers and businesses are paying much more for the product.
The Governor has already declared a state of emergency for propane, as just days ago he relaxed driving restrictions on truck drivers in an attempt to resolve the issue.
Agencies are meeting regionally to try and fix the problem.
Sara Johnson is one of the lucky ones--she locked in her rate months ago; now prices are jumping dramatically across West Michigan.
"It saves us quite a bit, because even at $2.08, we spend $800 to fill the tank up, so 50 cents a gallon, that's quite a bit more," she said with a laugh.
The market is getting tighter and tighter, and cutomers and businesses alike are feeling the pinch.
Companies like Knapp Energy in Kalamazoo Township tell Newschannel 3 that the price for a gallon has gone up more than a dollar since the summer--a spike not seen in years.
Over at E.M. Sergeant in Kalamazoo, President Pete Woodruff tells us its biggest issue is the driving condition of the roads and the weather delaying deliveries.
"We haven't been turned away from our suppliers; we're still able to get plenty of product," Woodruff said. "The biggest problem is simply transportation."
According to the Michigan Propane Gas Association, Michigan is the largest user of propane for heating homes in the country, with 300,000 business and homes--10 percent of the population.
And the Michigan Public Service Commission says the average price per gallon has jumped more than 50 cents from this time last year until now.
Those agencies blame a widespread shortage on a late, wet harvest season for corn, as farmers use propane to dry it. In addition, they look at extreme weather conditions and neighboring states.
"We're used to the cold here, we're used to a lot of these issues, so Michigan was prepared; however, our neighbors out west were not, and as their supplies dwindled, they came farther and farther, and now they're come to get their propane from Michigan," explained Derek Dalling, with the Michigan Propane Gas Association.
As it stands, many companies have several different suppliers, so they can still get the product.
They say more and more people will start locking in their prices, so they don't go through something like this again.