Task force offers advice to better secure, deliver winter propane supply

September 18, 2014 By    

The National Propane Gas Association (NPGA) issued an Aug. 31 letter to members ahead of the winter heating season, reminding them about the new energy environment in which the propane industry is operating and how it is competing with international buyers for the commodity.

“As an industry we must adapt, and do so quickly,” the letter states.

NPGA’s Supply and Infrastructure Task Force, which was created following last winter’s regional supply challenges, issued a set of recommendations earlier this year in a document titled the “Marketer Supply Planning Guide.” According to NPGA, the guide is designed to help propane marketers secure and deliver propane for the upcoming winter heating season.

A number of areas is addressed in the planning guide, including supply contracting, primary storage and marketer plant storage. The task force recommends marketers evaluate the strength and reliability of the midstream companies with whom they contract propane. The task force also suggests marketers contract for a significant portion of their anticipated needs and prepare a contingency plan if their needs exceed their forecast. Also, marketers should track their progress throughout the season and modify their supply plan as needed, according to the task force.

Storage is addressed in the planning guide, as well. The task force recommends exploring opportunities to maintain propane storage in primary caverns – even if this is something marketers have not done previously. Marketers should also evaluate their own plant storage, particularly if they have turned their storage more than 20 times per year. The task force recommends marketers keep 10 to 14 days of supply on hand during peak season in owned or directly controlled storage, as well.

The full document is accessible at www.npga.org/npgasupplyrecommendations.

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