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Propane's good partners
August 1, 2009 By: Tom Jaenicke LPGasAmerica’s interest in shifting to a greener renewable energy world is heating up.
In this transition, propane can adapt quickly and become a stabilizing partner with renewable energy sources such as solar, wind and ground and air.
Propane marketers – you need to pay attention to these changes in the marketplace because it will mean never-before-seen opportunities.
A recently published white paper, “Propane-Enhanced Renewable Energy Systems,” provides information on using renewable energy with propane as an effective backup energy source. The report, funded by the Propane Education & Research Council and written by engineer and heating specialist John Siegenthaler, of Holland Patent, N.Y., provides information for builders, remodelers, architects and HVAC specialists who want to expand their knowledge of green building strategies.
A copy of the white paper is available at www.buildwithpropane.com/propanebackup.
Propane’s role
Most renewable energy sources are intermittent by nature and not always available when needed. Americans are used to the comfort and convenience of traditional energy sources, but should be more willing to consider renewables when they are supplemented by an efficient and environmentally respectful form of conventional energy like propane.
Studies have shown consistently that propane generates considerably less greenhouse gas emissions than other forms of conventional energy such as electricity, so it makes a great partner with renewables. Propane can be produced as a renewable energy and may someday officially be considered renewable, but, until that time comes, propane makes a practical choice to couple with other renewable forms of energy to become a green and efficient hybrid system.
Some propane marketers will reject the findings in this white paper and declare that propane as a backup or partner with renewables will only accelerate the nega-Btu race that is lowering the average gallons per customer for many marketers.
Let’s not confuse short-term conservation measures that our customers can employ versus long-term efficiency upgrades such as renewable energy installations.
When the price of propane skyrockets, such as it did in the summer of 2008, with longer-term effects lasting through the winter of 2008-09, consumers are very resourceful at finding ways to save on their energy bills. Vacation homes are shut down and not used. Thermostats are turned down. Clothes are hung outside to dry. Optional uses of propane, such as for fireplaces and pool heaters, are halted. The propane industry self-inflicts this conservation with steeply rising propane pricing.
The effects of a short-term propane price spike lasting only one or two tank fills for the customer can last a year or more before normal use behavior resumes. This pattern is much slower to self-correct than a steep rise in gasoline prices, while normal driving behavior resumes shortly after gasoline prices return to acceptable levels.
Efficiency upgrades
A small but growing percentage of consumer conservation measures is being supplemented with permanent efficiency gains through home improvements such as appliance upgrades and insulation improvements.
Efficiency upgrades can be much better news for propane marketers than conservation measures brought on by propane pricing fluctuations.
A consumer is much more likely to set the thermostat at 70 degrees instead of 65 degrees if the consumer has a 95 percent efficient furnace instead of that 65 percent efficient furnace that had such a healthy appetite for propane.
The propane tankless water heater is another easy upgrade that consumers can make to save more energy and become greener, especially if they have electric water heaters now. Long-term energy savings from heating and water heating with highly efficient propane equipment leaves consumers feeling better about turning the propane fireplace back on and taking a swim in a warm swimming pool.
Federal tax credits and state incentives will drive these efficiency upgrades, and aggressive propane marketers will end up with more propane appliances in use in customers’ homes. This is a much better situation than sharply lower customer usage due to short-term conservation measures brought on by propane price spikes.
Develop your plan
You should be starting to work on your marketing plan for next year. Think about how you can participate and gain gallons from the energy-efficiency-upgrade phenomenon that will be with us for the next few years. Early adapters will be the most successful propane marketers of the future.
Propane is American energy. Don’t forget that about 95 percent of propane is produced in North America from North American sources of natural gas and crude oil. That means propane is another effective means of breaking our dependence on foreign sources of crude oil, just like the renewables. The Pickens Plan spells this out very well. I recommend that you join the Pickens Plan and become more active in the energy metamorphosis that is going on around us. I joined last month.