Deadline pressure

For the most part, the propane industry feels prepared to meet an April 1 deadline for propane cylinders to be fitted with overfill protection devices.

The new NFPA-58 regulations mean mountains of obsolete valves.

There remains widespread concern, however, that the general public is still unaware of the mandate for OPD valves. This summer, backyard chefs caught in mid-picnic with an empty and obsolete barbecue bottle may end up grilling their local propane marketer over the cost and inconvenience of replacing non-compliant tanks.

“There’s still some confusion,” reports Baron Glassgow of the National Propane Gas Association. “Our industry is familiar with this issue – it’s the consumer who is going to be surprised.”

According to National Fire Protection Association code, all propane cylinders between 4 pounds and 40 pounds capacity must be equipped with an OPD in order to be legally filled. The device – similar to a float in a toilet tank – ensures that a cylinder is only 80 percent full, allowing room for the gas to safely expand when heated.

An OPD can be quickly recognized by its triangular-shaped handwheel; non-compliant valves have round or star-shaped wheels.

Although only 28 states have officially adopted the NFPA-58 code into law, propane dealers nationwide are expected to adhere to the costlier standard regardless of their local fire codes.

“It’s a national code, and the national companies will follow it,” according to Rick Simpson, vice president of sales and marketing for cylinder manufacturer Manchester Tank and Equipment of Brentwood, Tenn.

Non-compliant valves have round or star-shaped hand wheels (left). All OPDs, regardless of manufacturer, feature a non-removable triangular shaped wheel (right).

“You can’t buy a new cylinder without an OPD, so it’s here to stay,” agrees Theodore C. Lemoff, the NFPA’s senior gases engineer. Each state will set up its own enforcement mechanism, but Lemoff expects the inherent liability issues to make the insurance companies primary enforcers.

“In many ways, the propane dealer is the actual enforcer,” observes Glassgow. “I encourage every single propane dealer to require OPDs.”

A propane marketer who fails to abide by the OPD mandates faces staggering legal liability should there be an accident, Glassgow warns. “One of the first questions to be asked in court will be: ‘This state-of-the-art device is available;why aren’t you using it?'”

He urges propane dealers not to be intimidated by customers angered over the inconvenience or cost of converting to an OPD. You are better off without them. “If that consumer storms off down the street to a competitor, it also means you are shipping off liability to a competitor.”

Converging on conversion

“We will be 100 percent OPD throughout the country,” says Dave Pataki, director of marketing for propane exchange and re-sale at AmeriGas. The nation’s largest propane retailer operates the second-largest cylinder exchange program in the United States.

The company is introducing its new PPX-Plus product line to coincide with the conversion at its 16,000 locations. Since last October AmeriGas has been adjusting its Pre-filled Propane Xchange program to meet the deadline.

OPD update

“Our prices have gone up slightly because we have to provide an OPD valve in everything we do,” Pataki explains.

To ease the bite felt by steamed cylinder exchange customers, the company offers PPX-Plus discount coupons and propane level-indicating strips with its cylinders.

Exchange rates for the now-obsolete cylinders that previously ranged from $14.99 to $17.99 have been upped to $19.99 to $23.99 to accommodate the new standards. To simplify the conversion, all cylinders brought in to AmeriGas will be exchanged rather than refilled.

“We have a ‘no inspection’ rule at our exchange cabinets,” says Pataki. “That retail clerk may not even know what an OPD valve is.”

Despite the preparations, Pataki suspects consumers will be caught off guard when they arrive to replenish their empty barbecue bottles. Still, he doesn’t expect a rush of consumers to beat the deadline.

It is estimated that there are 37 million to 50 million non-compliant cylinders remaining in circulation – down from an estimated 60 million in 1998.

“That’s a lot of propane tanks,” says Robert Bunnell, a spokesman for Blue Rhino Corp., based in Winston-Salem, N.C.

Bunnell expects the OPDs will drive more consumers to become exchange customers. Already, the cylinder exchange marketplace has grown six-fold since 1995.

Blue Rhino, the nation’s largest cylinder exchanger, has 20,000 cylinder exchange sites in operation. “Nationwide we have more locations than McDonald’s, Wendy’s and Burger King put together. There are a lot more places to exchange your cylinder than there are to get a hamburger.”

Blue Rhino outlets will be charging an OPD upgrade fee ranging from $10 to $15. “That will vary a bit from location to location based on the retailer,” Bunnell says.

According to Blue Rhino’s figures, a typical backyard chef goes through 2.1 20-pound propane cylinders per year. Based on those numbers, the company expects OPD cylinder demand to be stretched out over the summer months, rather than a mad rush at the first sign of cookout weather.

Reggie Hall, president and owner of Certified Cylinder Inc. of Crossville, Tenn., doesn’t see it that way.

“The exchange cabinets will be overrun,” he predicts. “You won’t get a rush until people realize they can’t get their cylinders filled any more. Then the propane dealers will be backed up with tanks that they won’t have time to change the valves on.”

Under Hall’s scenario, Manchester and Worthington Industries – the industry’s two top tank-makers – will be hard pressed to keep up with demand.

“I don’t think they can warehouse enough tanks with the orders they’ll be getting,” Hall says. “I think some states will back up and delay enforcement because there will be an outcry from the public over a shortage of cylinders.”

Columbus, Ohio-based Worthington has spent the past year gearing up for the OPD deadline, says Brian Ziegler, director of the company’s LPG cylinder business. “We have built substantial inventories for this, and we feel we are prepared,” he says. “This is all not going to happen April 1st.”

If there is a run on cylinders, Worthington can add shifts, move to an overtime schedule or expand operations to other plants. “If it picks up more than we expect, we have extra capacity that we can put into place,” Ziegler says.

Manchester likewise has beefed up inventory following a “banner year” of sales based on previous demand levels, Simpson reports. The Y2K fears prompted many people to stock up on new cylinders – already equipped with OPDs – in preparation for the anticipated Armageddon.

“A lot of the population went out and bought stuff that they really didn’t need – just in case,” he says.

Business also is flowing at Stopfill Inc. of Mount Pleasant, Pa., a maker of OPD valves.

“We definitely have seen an increase of business on our end,” says company representative Dave Lawson. “We’re trying to get a big inventory built up. Lots of people are talking about big numbers. We have two full shifts running non-stop; we hope to have a third shift going (soon).

“Everybody’s talking big numbers, but nobody truly knows what’s going to happen until April hits. If it’s truly enforced (by state fire officials) the numbers are likely to be quite high.”

Lawson believes that the demand for OPD valves will stretch out over a manageable period of time, likely several years. “It’s going to be an exciting and interesting year here,” he predicts.

Tanks a lot

Disposing of non-compliant tanks that can’t be refilled or reconditioned is yet another issue. They are too small to be torched in half lengthwise to make barbecue grills, and so far they have not caught on as flowerpots.

“The propane industry cannot absorb all these cylinders,” notes Louis Benjamin, president of Cylinder Recovery Solutions in Woodbine, N.J.

The new NFPA-58 regulations mean mountains of old cylinders that must be scrapped. Some 37 million to 50 million non-compliant cylinders remain in circulation.

Benjamin reports a brisk demand for used cylinders by refillers; those rendered obsolete need to be safely taken out of circulation.

“Many people will be putting these cylinders out with their household trash, but because of the hazardous and flammable liquid and vapors they might contain, propane tanks require special handling. They cannot be disposed of like other waste,” he notes.

Propane dealers dealing with an influx of non-compliant, obsolete tanks should contact their state’s propane gas association to see if a cylinder recycling program exists. Earlier on, Indiana, Michigan and North Carolina were preparing contingency plans. Local fire officials also should be able to offer guidance.