How 3 states are rewriting the rules on propane

May 21, 2026 By Gordon Feller 0 Comments

From a bipartisan energy-choice push in Michigan to a consumer watchdog proposal in New York and an appliance-freedom bill in Pennsylvania, state legislatures are reshaping the regulatory landscape for propane — and the industry is watching closely.

In the first several months of 2026, the propane industry finds itself at the center of a wide-ranging legislative debate – fought simultaneously on the terrain of consumer rights, environmental law and market oversight – across statehouses from the Great Lakes to the Atlantic Seaboard. While Washington debates a federal Energy Choice Act, the more immediate and consequential action is happening at the state level, where three distinct proposals illustrate the competing pressures on an industry that supplies heat, cooking fuel and industrial energy to millions of rural and suburban Americans.

The bills could hardly be more different in their intent. Michigan’s House Bill 4486 arms propane with a statutory shield against local government prohibition. New York’s Assembly Bill 10585, introduced in March 2026, would install a state watchdog to scrutinize how propane is priced and sold. And Pennsylvania’s House Bill 515 would make it illegal for any state agency or municipality to ban household appliances based on the fuel type they burn. Together, they offer a remarkably clear window into the ideological and practical tensions that define propane policy in 2026 in the United States.

Michigan HB 4486: Banning the ban

When the Michigan House passed House Bill 4486 on Dec. 16, 2025, by a vote of 61-42, it delivered one of the most direct legislative victories for the propane industry in recent memory. Sponsored by Rep. Steve Frisbie, R-Battle Creek, the bill prohibits counties, cities, villages and townships from adopting or enforcing any ordinance, resolution or policy that restricts the use of natural gas or propane – or blocks the installation of the infrastructure that delivers them.

The legislation’s definition of propane is notably inclusive: It covers not only conventional liquefied petroleum gas but also renewable propane and blended products, a provision that effectively future-proofs the protection by encompassing the lower-carbon variants of the fuel that the industry has been promoting as part of its green-energy credentials.

“Families and small businesses should be able to choose what works best for their homes and operations without local governments forcing one-size-fits-all energy mandates,” Frisbie says.

Frisbie introduced the bill in the context of a growing national movement by municipalities to discourage or outright ban fossil fuel hookups in new construction – a trend that picked up momentum after Berkeley, California, enacted the first U.S. gas ban in new buildings in 2019, and that accelerated when New York state passed its sweeping All-Electric Buildings Act. Michigan’s bill is a direct counter-maneuver: a preemption statute designed to prevent any Michigan city from following Berkeley or New York City down that path.

Supporters argued that the measure protects energy affordability in a state where many households depend on propane and natural gas for heat, and where the electrical grid would be strained by a mass shift to electrification. Opponents countered that the bill strips local governments of the authority to make environmentally informed zoning and building decisions – a concern amplified by the fact that the bill, passed along broadly partisan lines, now awaits action in the Michigan Senate, which Democrats control. The bill’s fate in the upper chamber remains uncertain, but its passage through the House alone has been hailed by industry groups as a significant signal.

New York A10585: A watchdog for propane companies

While Michigan was moving to protect propane’s market access, New York was moving in a conspicuously different direction. In March 2026, Assemblyman Angelo Santabarbara, a Democrat, introduced Assembly Bill 10585, a measure that would establish a propane consumer pricing adviser and a 12-member propane advisory board within the New York State Department of Public Service – the agency that regulates the state’s public utilities.

The rationale is grounded in the particular vulnerabilities of propane consumers, who tend to be concentrated in rural and suburban areas underserved by piped natural gas. Unlike natural gas customers who are served by regulated utilities with rate structures subject to oversight, propane customers typically purchase from private marketers operating in a less-regulated environment. Price swings, opaque contract terms and wide regional disparities are recurring complaints that the bill aims to address.

Under the proposal, the pricing adviser – working in conjunction with the advisory board – would be charged with monitoring propane prices across the state, identifying regional pricing disparities, reviewing contract terms and fees, and publishing annual reports with findings and recommendations directed to the governor and the legislature. The board itself would represent a cross-section of stakeholders: consumer advocates, propane industry representatives, small business owners, and residents from rural and suburban communities.

New York’s bill does not seek to control prices – it seeks to illuminate them. The distinction matters enormously for an industry accustomed to minimal regulatory scrutiny at the retail level.

Crucially, the bill’s sponsors have been explicit that the measure is not intended as price control. The adviser’s mandate would be informational and advisory, not regulatory in the rate-setting sense. Collaboration with the state attorney general’s office is envisioned for cases involving consumer complaints or potential legal violations, but the core function is transparency rather than enforcement.

The bill arrives at a moment of heightened tension for New York’s propane sector. The state’s All-Electric Buildings Act – which would have prohibited propane and natural gas hookups in most new construction starting Jan. 1, 2026 – was suspended by court order after a coalition of industry groups won a stay during an appeals process. That legal battle has brought unprecedented scrutiny to propane’s role in New York’s housing stock, particularly in rural upstate communities where alternatives to propane are limited or nonexistent. For propane marketers, A10585 presents a complicated picture: Consumer-facing transparency is a double-edged sword in a market where margins and pricing practices have historically attracted little public scrutiny.

Pennsylvania HB 515: Energy freedom across the commonwealth

Pennsylvania’s contribution to the debate is House Bill 515, introduced by Rep. Martin Causer, a Republican, and referred to the House Energy Committee in February 2025. The bill, titled Energy Freedom Legislation, would prohibit both the Commonwealth of Pennsylvania and its municipalities from taking any action to ban certain household appliances based on the type of energy they use – an explicit protection for propane-powered furnaces, water heaters, stoves and similar equipment.

Pennsylvania’s situation is in some ways the most complex of the three states. Unlike Michigan, which has a Republican House, or New York, which is overwhelmingly Democratic, Pennsylvania has a split legislature – a Democratic-controlled House and a Republican-controlled Senate — making the passage of any energy-related legislation a genuine exercise in negotiation. HB 515, with its roster of Republican sponsors, faces a challenging path through the lower chamber, though it has attracted the active support of the Pennsylvania Petroleum Association, which has urged members to contact their House representatives in support.

The bill builds on years of prior legislative attempts – Causer’s office notes it is a successor to previous versions introduced in earlier sessions – and its core logic mirrors what is happening in Michigan and in more than two dozen other states that have enacted some form of energy choice protection over the past several years. The National Propane Gas Association, which tracks these bills nationally, identifies Pennsylvania as a critical battleground precisely because the state’s split government means neither side can move unilaterally.

With 28 states having now enacted some form of energy choice protection, the legislative map is increasingly polarized – and the remaining battlegrounds, like Pennsylvania, are the ones that matter most.

Also on Pennsylvania’s legislative radar is House Bill 660, introduced from the Democratic side, which would establish minimum energy efficiency standards for commercial and residential appliances sold in the commonwealth – a bill that the petroleum association opposes and views as a potential indirect pathway toward disfavoring fossil-fuel appliances. The two bills, moving in opposite directions through the same committee, illustrate the gridlock that characterizes energy policy in divided-government states.

Three bills, one debate

Taken together, these three proposals reveal a propane industry that is simultaneously defending its market position, managing new consumer-protection pressures and navigating a political landscape that has shifted meaningfully in its favor at the federal level but remains contested at the state level.

Michigan’s HB 4486 is the most aggressive of the three – a preemptive strike against the kind of local gas bans that have taken root on the coasts, enacted in a state where the industry has enough political allies to push it through at least one chamber. New York’s A10585 is the most consumer-oriented, born out of a state with a powerful tradition of utility regulation and a Democratic majority that is more comfortable with oversight than with prohibition. Pennsylvania’s HB 515 sits somewhere in between: an energy-choice protection measure trying to survive a split legislature, where the outcome will depend less on ideology than on the ability of both parties to find common ground.

What all three states share is the recognition that propane – long treated as a secondary fuel, a rural utility without the regulatory infrastructure that surrounds natural gas and electricity – has become central to some of the most consequential energy policy arguments of the decade. Whether the result is protection, oversight or stalemate, propane’s place in the statehouse debate has never been more prominent.

Gordon Feller is a Global Fellow: The Smithsonian Institution; a White House appointee of a federal commission advising the U.S. secretary of energy; and an adviser to U.S.-based companies.

Featured image: Elisank79/iStock / Getty Images Plus/Getty Images

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