Updates
February 8, 2014: the government steps in. Orders EPD to prioritize propane shipments to the midwest.
February 7, 2014: human toll due to propane shortage; human interest story out of Missouri. The Los Angeles Times is reporting:
KNOB NOSTER, Mo. — From a bay window in her home on the prairie, Angela Hostetler stares out at the six huge chicken barns out back. They hold 156,000 chickens, and when she and her husband, Mardy, purchased the farm two years ago, it seemed like a good investment.
But this year, the Hostetlers are struggling. That's because their barns, which must be kept at 85 degrees to keep young chickens warm, are heated by 12 1,000-gallon tanks of propane, which are now covered in icy snow.
Propane prices have tripled this year, and the Hostetlers have stopped using propane to heat their home. Now they plug in electric space heaters to counter the 15-degree cold in this unusually brutal winter.
Still, their last propane bill was $26,000, and that covered just a month of fuel. Because of the cold, they've been using more fuel than usual to keep the barns warm. The Hostetlers estimate they'll spend at least $70,000 on propane this winter. Last year's tally: $30,000.
"It's really scary, you don't know how you're going to pay for it," said Hostetler. "It makes you panic when you get those bills." She says the family has considered taking out a loan to pay for propane.
Original Post
- January 23, 2014, The Duluth News, after the original post; no mention of the Cochin pipeline
- January 22, 2014, The Dickinson Press, after the original post
- November 11, 2013: propane shortage for farmers
- November 29, 2013: the propane story gets more and more interesting
Now this story sent in by a reader fills in some of the background why propane prices are spiking. The AP via Yahoo!Finance is reporting:
Several states in the upper Midwest are dealing with significantly higher prices for propane because of a supply problem caused by a late harvest, persistent very cold temperatures and the temporary shutdown of a major supply pipeline.
The problem began in October and November when farmers across the Midwest took to the fields to harvest the late developing corn crop before the cold weather set in. Much of the crop was still wet and needed to be run through propane powered dryers to avoid spoilage, creating a surge in demand for the fuel.
And as colder than usual temperatures arrived early in the Upper Midwest, demand for propane increased. The liquefied petroleum gas is used to heat homes in rural Midwestern areas where there are no natural gas lines. About 15 percent of Iowa households rely on propane for warmth.
"We came out of a crop drying season that really took a toll on the amount of volumes available in the industry," said Drew Combs, vice president of propane for Minnesota-based CHS Inc., one of the nation's largest wholesalers. "Now we're looking at a situation where we have a very large demand because of the extremely cold weather ... and it is looking to last into January."
It may be worse next year:
To compound the issue, a major pipeline was shut down from Thanksgiving to Dec. 18, further reducing the availability of propane in the Upper Midwest.
The 1,900-mile Cochin pipeline carries propane southeastward from Canada, through North Dakota and Minnesota, across northeast Iowa and into eastern Illinois. Its owners, Kinder Morgan Energy Partners, shut the pipeline down to install new pumps that would reverse the pipeline's flow early next year. Instead of bringing products such as propane from Canada, the company plans to move a petroleum product called light condensate from Illinois to Alberta, Canada, where the product is in high demand and more profitable. It is used to dilute bitumen — thick oil taken from Canadian oil sands — so it can be transported.
Minnesota, which gets about 40 percent of its propane from the pipeline, was hit hard by its closure, which forced propane suppliers to send trucks to northern Iowa terminals for fuel. Add additional traffic from North Dakota, South Dakota, and Wisconsin to the Iowa terminals and the stress on Iowa's propane supply became a serious issue, said Harold Hommes, an energy analyst for the Iowa Department of Agriculture and Land Stewardship.
This repurposed pipeline will have far-reaching consequences:
The propane industry is preparing for the long-term loss of 50,000 barrels per day the Cochin pipeline provided. Kinder Morgan plans to shut down propane transport early next year as the pipeline is repurposed.
Combs said CHS is building railroad terminals in Minnesota, North Dakota, and Wisconsin and is significantly increasing rail car leases to transport more propane to areas that will see a loss when the pipeline shuts down.
Farmers and the retailers that sell them propane likely will need to increase storage capacity for propane to ensure they have a 10- to 14- day supply on hand, Combs said.
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US Snow Record
Merry Christmas
Last week, snow covered more than half of the continental United States, the highest this measure has reached by this date in a decade, according to government scientists.
As of Dec. 15, snow covered 53 percent of the Lower 48, the National Oceanic and Atmospheric Administration (NOAA) reported. That’s a significantly higher portion than in recent years. In 2006, for example, snow covered just 12 percent of those states on the same date, according to Climate Central, a climate news Web site.
November and early December have also been quite chilly for much of the country, below the 20th-century average, Climate Central noted. “With the noteworthy exception of Alaska, nearly every state was affected by the unusually cold air at some point during the November-to-December timeframe,” Climate Central reported.What’s going on?
An unusual configuration blah, blah, blah, but it's not a sign that global warming is going away blah blah blah...
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