As frigid temperatures plague the state for the second time this month, Gov. Scott Walker has ordered that state agencies address the growing propane heating crisis.

Propane gas prices have more than tripled from $1.49 per gallon at this time last winter to the current price ranging from $5 to $6 per gallon, according to the State Energy Office.

“We realize this is a crisis situation, and residents just can’t wait for this issue to be addressed,” Mark Maley, Wisconsin Economic Development Corporation spokesperson, said.

The WEDC’s board of directors held an emergency meeting yesterday to approve a loan guarantee program to aid propane dealers.

The program will encourage banks to grant loans by guaranteeing 80 percent of individual lines of credit extended to propane dealers across the state.

“We created this program in a matter of four days, which is almost unheard of for any kind of state agency,” Maley said. “We heard about this on Thursday and, by Tuesday, we had a working program in place.”

Brandon Scholz, the Wisconsin Propane Gas Association spokesperson, said this is a major crisis for the state’s 250,000 residential propane users and the entire Midwest region because demand for propane is at an all-time high, while supply is extremely low.

On top of the increased demand for propane in agriculture, specifically in corn production, cold temperatures around the country caused demand to soar to unprecedented heights, Scholz said.

“The short version is it’s a crisis,” Scholz said. “It’s a major crisis.”

The situation is especially dangerous while propane dealers are paying more for their propane supplies than they are receiving from their customers, Scholz said.

Maley said the state is pursuing other ways of resolving this issue in addition to the corporation’s loan guarantee program. A similar $3 million program to aid distributors is currently in the process of being approved by the Wisconsin Housing and Economic Development Authority, and the governor is also providing $8.5 million to individual residents to purchase propane.

“Gov. Walker’s efforts to provide emergency funding is hugely important at this time because it will hopefully prevent some dealers from going out of business,” Scholz said.

Scholz said he urges residents who use propane for heating and cooking purposes to practice as many conservation measures as they can. In addition, he said individuals should look out for their neighbors, especially if they are elderly, to make sure they are aware of their propane levels.

[Photo by Flickr user jasonwoodhead23] 

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