Propane prices start to drop across Minnesota, region

Empty propane tank
Ron Selleck of North Branch, Minn. is heating his home with electric heaters after his propane tank ran empty. Rising propane prices are worrying many rural Minnesota residents who count on the fuel to heat their homes amid a bitterly cold winter.
Jerry Holt/The Star Tribune via AP

After weeks of rising prices in the Upper Midwest, Minnesotans who heat their homes with propane are starting to see some relief.

The price of propane for heating in the state fell from $4.61 to $3.97 a gallon for the week ending Monday, according to numbers released by the U.S. Energy Information Administration (EIA).

Petroleum markets analyst Mason Hamilton said the drop in prices appears to be a result of an increased propane supply in the region. For the week ending Jan. 31, propane inventories in the Midwest increased by about 770,000 barrels. In normal years, the Midwest's propane inventory during that week of winter usually drops by 1.4 million barrels, meaning more propane than usual is heading north.

Minnesota Commerce Commissioner Mike Rothman said the state government's efforts to make propane easier to transport seem to be having some effect on the shortage. Gov. Mark Dayton issued an order that was extended by the state's Executive Council last week temporarily lifting some restrictions on the transport of propane.

"Over the last week and a half we're hearing from industry that the supply is now getting up from the south and into our system through trucks," Rothman said. "We've been monitoring very closely the price of fuel going to homes, it's spiked at a very high level, but even as the levels have come down they've been very distressing to our homes and our families."

Dayton also sent letters to President Barack Obama and Minnesota's congressional delegation today asking for an additional $17 million in funding for the state's Low Income Home Energy Assistance Program (LIHEAP).

Rothman said that current LIHEAP funding will run out by March 10 due to high demand this winter and the governor's decision to expand eligibility in the wake of the propane crisis.

The Department of Commerce reports that over 100,000 Minnesota households were receiving energy assistance as of the end of January. About 30,000 more households are waiting to see if they're eligible for the benefits.

The state is also running a hotline that people seeking assistance or answers about the propane shortage can call. It's (800) 657-3504 in outstate Minnesota or (651) 297-1304 in the Twin Cities.

"We have focused all hands on deck to be able to best help Minnesotans get through these very tough times during the cold weather and supply shortage," Rothman said.

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