| clocks for websites |
News
No assessment cuts yet despite PERC spending restriction
November 1, 2009The government mandate to shut down $10 million worth of marketing and advertising programs promoting the general benefits of propane will not result in a rollback of industry assessments that fund the Propane Education & Research Council (PERC) initiatives.
At the urging of PERC President and CEO Roy Willis, the council last month agreed to maintain the current assessment level and redirect canceled education program funds into expanded research and development, safety and training efforts. The industry pays five-tenths of a cent on every gallon of odorized propane – about $50 million per year – to fund PERC operations.
The council had considered reducing the assessment by one-tenth of a cent (about $10 million) and maintaining current spending levels in all non-education programs.
Willis said he sees enough opportunity to expand R&D, safety and training efforts to warrant $10 million in additional spending each year in those areas. If specific projects cannot be identified by next spring, the council could reconsider cutting the assessment, he advised.
He noted that PERC had received four letters concerning the assessment rate from state associations. Three of them urged the council to maintain the current level.
Council instructed Willis to create a business plan showing use of the redeployed resources for its December meeting. At that time it will vote on PERC’s 2010 budget.
The spending restriction was triggered by a Commerce Department finding that propane prices – relative to other energy prices – exceeded a threshold established in the consumer-protection clause of the Propane Education and Research Act of 1996.
In other business, the council:
• Directed the Budget and Finance Committee to prepare a 2010 budget plan that assumes that the assessment rate (five-tenths of a cent per gallon) will remain unchanged for 2010.
• Directed the advisory committees to develop proposals for reallocating consumer education funds to programs in research and development, training, and safety matters.
• Resolved to encourage the propane industry to support a celebration of the industry’s upcoming centennial, and it authorized Willis to ask the Global Leadership Forum to hold its 2012 meeting in Washington to coincide with the centennial celebration.
• Approved the appointed Ken Green, Oklahoma Liquefied Gas (Seminole, Okla.), and Gary Shepherd, Stanford LP Gas, of the Motor Fuel Division (Midland, Mich.), to serve on the Engine Fuel Advisory Committee.
• Adopted the Propane Research and Development Roadmap 2009, which was prepared by the PERC Research and Development Advisory Committee.
• Authorized the release of a request for proposals to align the plant operations curriculum in the Certified Employee Training Program (CETP).
• Adopted final accounting reporting requirements for state rebate programs.
The council also approved funding for the following grants:
• $915,600 to Lehr Inc. for development of propane outdoor power equipment
• $795,000 to Gas Technology Institute (GTI) for development, testing and demonstration of micro-CHP (Yanmar)
• $725,000 to Kohler Co. for closed-loop electronic fuel injection LPG engines
• $667,500 to PERC and Kohler for heavy duty residential and commercial hybrid generator
• $586,000 to Osborn & Barr Communications for agriculture technology demonstration and validation program
• $435,687 to PERC for its stage-gate procedure
• $300,000 to PERC for expert analysis of propane’s ozone-forming potential
• $245,975.96 to CleanFuel USA for 6.0-liter W42 Workhorse Custom Chassis liquid propane application
• $192,759.50 to CleanFuel USA for heavy duty OBD II 6.0-liter L96 engine demonstration testing
• $184,631.38 to CleanFuel USA for cab chassis tank application for 6.0-liter engine certification
• $37,800 to PERC for consumer safety education outreach
• $35,613 to EnSave Inc. for training propane marketers to conduct farm energy audits
• $30,250 to Progressive Agriculture Foundation for training trainers and youth on propane safety at Safety Days
• $28,600 to PERC for consumer safety radio announcements
Change orders
• $140,000 to PERC for CETP 4.2, 4.3 course alignment
• $18,600 to Railroad Commission of Texas AFRED for introducing 90 percent efficient micro-trigeneration technologies to Texas dairy farming
• No cost to PERC for residential advertising – construction professionals/homeowners
• No cost to PERC for market growth programs and propane industry tools
• No cost to Roush for multi-year/multi-platform program
The council received a detailed report of the 44 replicated rebate requests – totaling $2.3 million – that PERC staff had approved since the last meeting. Six of the rebate requests asked for partnership funds totaling $342,687.
The council will meet Dec. 9-10 in Houston.