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Congress Forms Bipartisan Propane Caucus

Lawmakers from Ohio and Minnesota on Thursday announced the formation of a Congressional propane caucus to address issues and challenges facing both the industry and consumers as the nation's supplies continue to grow with the increase in unconventional natural gas production.

Rep. Robert Latta (R-OH) and Rep. Tim Walz (D-MN) said the caucus would serve as a "forum to engage members of Congress, their staff and the public" regarding propane usage and the infrastructure required to distribute it. A spokesman for Latta added that the caucus would educate the public on the different ways propane can be used and focus more specifically on how shale development has changed pricing and supply dynamics.

Latta, a member of the House of Representatives' Energy and Commerce Committee, has been focused on propane-related issues in recent years. He also co-sponsored a bill with Walz last year, the Propane Education and Research Enhancement Act, aimed at managing propane shortages and price spikes. Congress later passed the bill and President Obama signed it into law late in the year (see Daily GPI, Dec. 12, 2014).

That legislation came after the winter of 2013-2014, when bitter cold temperatures, high demand and prices, and a lack of supplies led to a propane shortage that prompted two dozen states and the federal government to take steps to ease the crisis (see Daily GPI, Jan. 22, 2014).

As shale gas extraction has increased, the production of propane from crude oil refinement has decreased dramatically. Today, propane is primarily a byproduct of domestic natural gas processing, which has led to an increase in supplies.

Nearly 50 million households and businesses nationwide use propane, according to the Propane Education and Research Council. The fuel has also seen increasing use among consumers in rural areas removed from more traditional power sources.

"Propane users are in almost every Congressional district in the United States," said Rick Roldan, CEO of the National Propane Gas Association, in welcoming the caucus' formation. "The Congressional propane caucus provides a dedicated group of legislators committed to addressing the infrastructure challenges facing these constituents."

Other trade groups, particularly in the Appalachian Basin, where the Marcellus and Utica shale formations have contributed significantly to natural gas liquids production, welcomed the announcement. Both the Ohio Oil and Gas Association and the Marcellus Shale Coalition said propane was growing in importance for the nation's energy needs and said they looked forward to working with the caucus.

Latta's office couldn't provide details about how often the caucus would meet as details are still being worked out. In addition to Latta and Walz, who will co-chair the group, it has eight other members, including representatives from New York, Pennsylvania, Wisconsin, Vermont and Iowa. Membership is expected to grow, Latta's spokesman said.

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