Regional spotlight: Propane fuels the West

November 17, 2023 By    

Our quarterly series examines the unique geographical nature of the propane industry. This month, we look at the West.

Look for other regional breakdowns in 2023

January: Propane fuels the Northeast

April: Propane Fuels the South

July: Propane Fuels the Midwest

Image: Rainer Lesniewski/iStock / Getty Images Plus/Getty Images

Image: Rainer Lesniewski/iStock / Getty Images Plus/Getty Images

About the West

Propane market conditions vary widely in the West, which encompasses the Rocky Mountains, Southwest, West Coast, Hawaii and Alaska. Each area presents unique weather conditions and distinct regulatory and legislative environments. California, an emerging hub for renewable fuels, surpassed Michigan as the top-ranked state for total propane sales in 2021. It was also the top-ranked state in internal combustion sales that year.

Propane sales

The West region accounted for 17.6 percent of total U.S. propane sales in 2021, a slight increase in market share compared to 2020. Total propane sales in the region increased from 1.588 billion gallons in 2020 to 1.676 billion gallons in 2021 due in part to an increase in heating degree-days. Most of the increase in sales happened in the commercial sector, which grew from 460 million gallons in 2020 to 509 million gallons in 2021.

2021 U.S. retail propane sales by region

2020 sales – 1,588 million gallons
2021 sales – 1,676 million gallons

The weather

Annual heating degree-days in the West increased by 1.3 percent in 2021 compared to a year earlier.

Mountain: 4,714

Pacific: 3,328

U.S.: 3,937

Tom Clark, executive director of the Rocky Mountain Propane Association, center, will assume leadership of the Colorado and New Mexico associations at the end of the year. (Photo courtesy of Tom Clark)

Tom Clark, executive director of the Rocky Mountain Propane Association, center, will assume leadership of the Colorado and New Mexico associations at the end of the year. (Photo courtesy of Tom Clark)

Unique to the West

State and regional associations: State and regional propane associations in the West have undergone changes in leadership. The Western Propane Gas Association of California selected Colin Sueyres as its new president and CEO, succeeding Joy Alafia, in 2022. Dan Binning, executive director of the Colorado and New Mexico propane associations, will retire at the end of the year and hand leadership of the two states to Tom Clark, currently executive director of the Rocky Mountain Propane Association.

Energy choice: The propane industry is struggling against gas bans on the West Coast, but bright spots have emerged in the fight. This year, a federal appeals court overturned a ban on gas hookups in new construction in Berkeley, California. Blue Star Gas, the Pacific Propane Gas Association, the National Propane Gas Association and other stakeholders have filed suit against Washington state to challenge new codes restricting the use of propane and natural gas in new residential and commercial construction. Colorado, New Mexico and Nevada also have faced threats to the use of gas. Arizona, however, was among the first states to pass energy choice legislation to prevent gas bans.

Renewables watch: California is a center of development in the renewable fuels space. The state is home to Global Clean Energy and Oberon Fuels, producers of renewable propane and renewable dimethyl ether, respectively. California’s Low Carbon Fuel Standard incentivizes the production of low carbon renewable fuels for the transportation market. Oregon and Washington have approved similar standards.

Weather: Wildfires are always a concern in drought-ridden Western states, but the Maui fire in August was devastating enough to make the National Oceanic and Atmospheric Administration’s list of billion-dollar disasters. California faced different challenges this year. Major flooding in the central part of the state from January through March also made the list of billion-dollar disasters. Southern California saw flooding when a tropical storm, unusual for the area, made landfall. Precipitation lifted the drought in most parts of California over the course of the year. Meanwhile, areas of Arizona, Montana, Oregon and Washington remain in extreme drought, while areas of New Mexico remain in exceptional drought.

Wages: Propane retailers in the Midwest raised employee wages by 12 percent on average, according to LP Gas’ 2022 wage and benefits survey.

Did you know? More than half of propane retailers in Gray, Gray & Gray’s 2023 propane industry survey say they operate their fleet vehicles on propane autogas. It’s the only region in the survey where more than half of respondents report running their fleets with autogas.

Other sources: Propane Education & Research Council’s Annual Retail Propane Sales Report (2021); U.S. Energy Information Administration

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