The development and production of renewable propane has skyrocketed in recent years. One significant reason for this growth is the availability of its feedstocks, which include animal and plant oils and materials that most consider to be waste.
In Europe, renewable propane producers have been working in tandem with biogas (also called renewable natural gas) companies to put food, agricultural, human and animal waste products to use creating renewable energy. In the process, they are making substantial strides at reducing methane emissions.
On a molecular level, propane consists of a chain of three carbon atoms bonded to eight hydrogen atoms. Methane’s molecule consists of one carbon atom bonded to four hydrogen atoms. This makes a difference in terms of the two products’ physical properties. Methane must be cooled substantially to take a liquid form. Propane becomes a liquid under pressure at a much higher temperature.
This is why natural gas (which is primarily composed of methane) exists in a gaseous state and must be transported in a utility’s pipe grid, whereas liquid propane can be transported in trucks, rail cars and cylinders. Propane also burns at a much higher temperature than methane, producing more than double the Btu output per cubic foot.
One concerning issue regarding methane is that it is more than 80 times more potent than carbon dioxide at trapping heat in the atmosphere. In addition to fuel extraction, livestock farms, landfills and the microbial activity in wetlands contribute mightily to methane emissions. It’s not possible to remove methane from the planet altogether.
But there are ways to lower methane emissions in the service of renewable energy.
Diverting organic waste away from landfills can lower the release of methane. Putting it to use generating biofuel, renewable propane and biogas has the benefit of replacing less green heating products used in homes, businesses and on our roadways.
In Europe, many of these renewable energy products are called “off-grid renewable gases” because they can be distributed without a utility grid. These fuels are insulated from grid dependability issues and can more easily serve poorer, rural households that don’t have access to a utility.
Reducing methane emissions has immediate environmental benefits. The technology already exists to convert methane-emitting waste into biofuel, biogas and renewable propane. Currently, 150 nations have committed to the Global Methane Pledge, which aims to “reduce global methane emissions at least 30 percent from 2020 levels by 2030.” These nations include the U.S., the United Kingdom and the European Union.
Speaking at a recent World LPG Association (WLPGA) roundtable, Charlotte Morton, OBE of the World Biogas Association noted that, although Europe remains a prime hub for methane reduction in the service of creating biofuels, she sees potential growth in the United States. Citing the passage of the Inflation Reduction Act, Morton believes there are growing incentives coming from American policymakers.
Renewable propane is produced with similar feedstocks to biofuel and biogas. We believe the renewable propane and other innovative blends will be America’s most widely available, affordable carbon-neutral energy solution. Producing them will be a crucial component in reducing methane emissions.
Sophia Haywood is the Advocacy and Communications Manager for Dimeta, a company that advances the production of renewable fuels, including recycled carbon Dimethyl Ether (rDME), which can be blended with conventional propane and markedly lower its carbon intensity. Speaking at the WLPGA roundtable, she was optimistic about the industry’s embrace of renewable technologies.
“We need a solution that will work for the industry, as well as households, businesses and policymakers,” she said. “I think we’re all headed in the right direction — we just need to keep up the momentum.”
You can learn more about renewable propane’s role in a cleaner, more sustainable future here.
Recently, the Renewable Propane Alliance enthusiatically welcomed a new member, Global Clean Energy. This California-based company develops and produces renewable fuels using a proprietary camelina feedstock.
Their farm-to-fuel production process opens up new opportunities for many individuals and businesses throughout the supply stream. And the sustainable fuel it yields — which includes renewable propane gas — is chemically identical to petroleum products, but its carbon intensity is over 80 percent lower!
We’re thrilled that Global Clean Energy has joined the Renewable Propane Alliance. Here’s a full rundown of their exciting process.
This oilseed crop is a distant cousin of canola. It grows in regions of North and South America, as well as Europe.
Camelina sativa is a highly desirable renewable fuel feedstock. Global Clean Energy’s camelina-based fuels have a carbon intensity (CI) that’s roughly 7 percent of the CI rating of traditional petroleum diesel.
The varieties of camelina that Global Clean Energy produces may soon have the lowest CI score of any plant feedstock. Over time, their renewable diesel could have a CI score at or below zero!
Renewable LPG is one of the co-products of Global Clean Energy’s renewable diesel production. Its Bakersfield refinery, which has a nameplate capacity of 15,000 barrels of renewable diesel daily, will soon provide renewable propane to UGI/AmeriGas.
“Camelina-based fuels, including renewable propane, can offer significant environmental benefits throughout its lifecycle – from the benefits camelina provides to the land on which it is grown to the finished fuels’ reduced emissions for end users,” Global Clean Energy’s Chief Executive Officer Richard Palmer said. “Strategic partners like AmeriGas support our goal of enhancing sustainability through advancing the growth of renewable fuels in California and elsewhere.”
Camelina grows quickly and widely without significant cultivation effort:
Farmers can grow camelina in late fall, early spring and summer. It can be planted on the same land before or after other row crops. Once the oil is extracted, camelina meal also functions as livestock feed!
You can download a draft letter here. Please update it with your information, then either email it to:
or mail vis USPS to:
The Honorable Secretary Tom Vilsack
cc: Robert Bonnie and Zach Ducheneaux
Secretary of Agriculture
1400 Independence Ave. S.W.
Washington, DC 20250
With its proprietary camelina-based fuels, Global Clean Energy is generating a highly scalable renewable product that meets federal emissions standards and California’s Low Carbon Fuel Standard. Their process touches every step of production, including:
There’s so much potential with camelina for farmers and renewable fuel producers. If you would like to support the continued growth of camelina and camelina-based fuels, we encourage you to submit a letter to the U.S. Secretary of Agriculture advocating for camelina’s designation as a Title I Crop under the Farm Bill. This change would make camelina eligible for Agricultural Risk Coverage, Price Loss Coverage, and the Marketing Assistance Loan Program, ensuring more farmers can adopt camelina into their crop rotations.
Although renewable propane gas has been on the market for less time than biodiesel and several other renewable fuels, it’s developing at an astonishing pace both in terms of research and production. The U.S. energy sector is taking notice and making substantial investments in renewable propane’s future.
One significant example of this investment came in January 2022, when UGI Corporation, the international energy conglomerate, announced it had entered into a 15-year agreement with California-based renewable technology firm Vertimass. Vertimass provides catalytic technology to convert renewable ethanol into fuel. UGI Corp. expects to build and operate multiple fuel production facilities for domestic and international distribution in the coming years. Roughly half of the capacity from these facilities can produce renewable propane.
The Vertimass partnership was part of a multi-pronged strategy from UGI Corp. to increase its renewable propane production. In February, UGI’s subsidiary AmeriGas Propane signed an agreement with Global Clean Energy Holdings to buy and distribute renewable propane.
These bold moves from a large energy company with propane distribution channels in the U.S. and Europe demonstrate the growing demand for renewable propane.
An estimated 20-25 million gallons of renewable propane are marketed in 16 states nationwide each year. While most of this fuel goes to transportation, there’s a growing desire to see it incorporated for use in US homes, farms, and businesses.
The same can be said for Europe. In 2018, Neste Corporation, an enormous renewable fuels producer, delivered its first shipment of 100 percent renewable propane from a dedicated facility with a capacity of 40,000 tons per year. This fuel powers vehicles, homes, and businesses throughout the continent.
Europe provides an incredible opportunity for UGI Corp., Neste, and any other energy company that wants to produce and market renewable propane. At present, roughly 40 million European households sit in rural areas that the natural gas grid doesn’t reach. Many of these homes rely on older, dirtier oil-based systems. Switching only 1 million oil households to renewable propane could eliminate up to 5 million tons of carbon dioxide emissions.
From a supply perspective, there’s tremendous financial upside for renewable energy companies to produce renewable propane for sale.
A recent study by the U.S. Department of Energy’s National Renewable Energy Laboratory found that biorefineries could increase their returns by selling renewable propane instead of using it in-house. Their initial capital expenditure could be recouped in as little as two months. By selling their renewable propane to marketers, these biorefineries may also be able to take advantage of renewable fuel credits.
The fuel producers pivoting toward renewable propane are seeing attractive growth potential. Roger Perreault, President and CEO of UGI Corp., stated that the partnership with Vertimass will “deliver significant renewable LPG for our customers as well as bring investment opportunity to interested stakeholders.”
As of today, U.S. biorefineries could potentially produce 50 million gallons of renewable propane each year. With renewable propane as a crucial tool, the propane industry continues to drive decarbonization with considerable financial growth opportunities.
We want to hear from you! If you have questions about renewable propane, please reach out to us.
A lot is happening in the renewable propane industry these days, with development, production and usage all ramping up. This is excellent news for home comfort providers and customers alike.
If you’re not fully versed, you might be confused by what renewable propane is and how it’s used. Here are ten essential facts you should know.
Just as conventional propane is a coproduct of crude oil and natural gas extraction, most renewable propane can be considered a coproduct of biofuel creation. Many of the same feedstocks that go into creating biofuel — animal oils, vegetable oils, biomass — are used to create renewable propane.
Conventional propane and renewable propane are molecularly identical. They can coexist in the same equipment without modification. And all the efficiency of conventional propane is present in renewable propane. It’s over 90 percent efficient in modern heating equipment and produces 43 percent fewer emissions than an equivalent amount of grid-produced electricity.
Production of renewable propane diverts used cooking oil and meat fats from languishing in landfills. In 2018, in conjunction with biofuel production, renewable propane production used the following as feedstocks:
That’s a lot of waste being put to good use!
Soybean oil is one of the most common feedstocks for both biofuel and renewable propane. It comprised 57 percent of all feedstocks in 2019! This presents enormous opportunities for soybean growers in the United States.
The 200,000 tons of American renewable propane currently made is only 0.1 percent of total propane production. There’s tremendous potential for growth as more resources are dedicated to renewable propane production. Also, since renewable propane is often a coproduct of biofuel, they will scale up together.
Unlike many renewable products and technologies, renewable propane is not theoretical or planned for the future. It’s here today! Even back in 2019, 7.6 million gallons of renewable propane were in circulation in the U.S., heating homes, powering appliances and fueling vehicles.
Renewable propane’s carbon intensity ranges from 20.5 to 43.5 grams per megajoule. That places it well below grid-based electricity, diesel and gasoline. It’s also one-half to one-quarter the carbon intensity of conventional propane.
In fact, renewable propane is carbon neutral at the point of combustion. A recent study determined that if one million European homes that currently exist beyond the gas grid used renewable propane, this would eradicate up to 5 million tons of carbon dioxide emissions!
Carbon dioxide emissions reduction is just one of renewable propane’s environmental benefits. When burned in vehicle engines, it produces far less nitrogen oxide than gasoline. Nitrogen oxide is a contributor to acid rain and respiratory issues.
Research happening right now could bring us to a place where renewable propane produces net-negative carbon emissions. One of the most promising tools for reaching this goal is dimethyl ether (DME). Researchers can now synthesize this biogas from animal waste. This prevents the release of methane and carbon dioxide into the atmosphere, and the product can be blended with propane.
There’s almost infinite potential with renewable propane, and both the public and private sectors seem to recognize this. Their investment in its future is vital.
Recently, we’ve been happy to see California’s Innovative Renewable Energy for Buildings Act, which will create incentives for renewable propane producers to create fuel for state buildings.
We’ve also seen major corporations like U-Haul, Suburban Propane Partners and UGI acquire and invest in renewable propane technologies, development and production. Hopefully, this investment will lead to continued evolution and growth for this vital, innovative fuel source!
Is there a topic you want us to explore? Drop us a line!
To hear some pundits and public officials tell it, the only way to achieve a net-zero energy future is to electrify everything. That means dramatically altering how Americans heat their homes, cook their food and drive their cars.
Unfortunately, advocates of “electrify everything” are often more interested in producing good headlines than good environmental policy. Electricity has many important uses but also many drawbacks. Putting all our eggs in the electrification basket is short-sighted, reckless and not especially effective in helping the planet.
Right now, we have an eco-friendly, domestically-produced energy source in propane. Propane is more efficient than electricity for heating homes and powering appliances; its carbon intensity is far lower than typical grid-sourced electricity.
And propane is becoming cleaner by the day.
Across the country, electrification advocates are pushing mandates for electric heat pumps, vehicles, water heaters, clothes dryers, cooking ranges, etc. The argument is that forcing these electric conversions will reduce people’s carbon emissions. But this logic is flawed.
Our electric grid is far from clean or energy-efficient. Today, nearly 25 percent of grid power comes from burning coal. One-quarter of all U.S. greenhouse gas emissions came from electricity production in 2020. Meanwhile, we lose 60 percent of all energy used in electricity generation during conversion. It takes 3.03 units of electricity to deliver a single unit of energy to an American home.
Let’s compare this to conventional propane:
What’s true in the home is also true on the road. This year, the comparative analysis showed that propane-fueled medium- and heavy-duty vehicles across 38 states and Washington DC produced a smaller carbon footprint than the same number of electric vehicles charged from the grid.
Renewable propane — molecularly identical to conventional propane but produced using renewable sources — offers an even brighter energy future. It further outpaces electricity for carbon reduction.
Renewable propane, compared to conventional propane, is a fungible product, meaning that no special equipment is needed to transport, store or use renewable propane. It has the same characteristics, including energy efficiency and low carbon intensity.
These products differ primarily in how they are made. Whereas conventional propane is a concurrent fuel product of extracting natural gas and oil, renewable propane comes from organic products commonly used in biodiesel creation: animal oils, vegetable oils, biomass, and other triglycerides.
The feedstock for renewable propane is inexpensive and plentiful, and its conversion process has an extremely low carbon intensity. In fact, renewable propane is carbon neutral at the point of combustion — there is no new carbon added to the atmosphere.
There’s still greater potential for decarbonization with renewable propane that incorporates dimethyl ether (DME), a naturally-occurring carbon gas that can be stored as a liquid under pressure and mixed with conventional propane. DME has exceptional carbon reduction capability, potentially leading to negative carbon output in the future.
The decarbonization value for both conventional and renewable propane is outstanding. They are reliable, sustainable energy sources available today. While we wait for the electric grid to transition to more renewable sources, propane remains this country’s energy solution.
If there’s a topic in the world of propane that you want us to cover, feel free to reach out.
Many people don’t know the difference between propane and natural gas. This is true even of those that use propane in their homes. After all, propane and natural gas look similar when burned in heating systems and appliances. People may also wonder if the propane in their tank is as efficient, safe and eco-friendly as the alternative their local gas utility offers.
While propane and natural gas are extracted through the same process, they have significant differences in composition and sustainability.
Simply put, propane is a natural gas liquid. It’s primarily extracted from the same wells as natural gas (also called methane). Fracturing rock basins to extract methane also frees natural liquid fuels. These liquids include ethane, butane, isobutane and pentane, but propane is the most plentiful natural gas liquid.
Significantly, since natural gas liquids are a part of the methane stream coming from the well, extracting propane does not require additional drilling.
And the United States produces a lot of it! With recent advances in extraction, we have become a net exporter of propane. Indeed, we export more than we use!
This means that the propane that American homes and businesses use for heat, hot water, cooking, drying clothes, and recreation is domestically produced. In a time of spiking oil prices, that’s crucial. Even as some propane originates with crude oil production, propane prices are still somewhat insulated from the effects of overseas conflict.
At its most basic, the physical difference between methane and propane is density. Methane is lighter than air, and propane is heavier. That’s why natural gas rises and propane settles.
Propane travels as a liquid in tanks. Unlike natural gas, it isn’t dependent on utility lines. This makes it a more versatile on-site energy storage system for homes and businesses, giving consumers energy security.
Methane is a greenhouse gas. So, while burning natural gas might not release as much carbon dioxide into the atmosphere as burning coal, it’s far from green. When released in raw form, methane acts as a greenhouse gas that’s 25 times more potent than CO2 at trapping heat in the atmosphere.
In contrast, propane is energy-efficient and clean-burning. It can reach over 90 percent efficiency in use, meaning very little heat energy is lost into the atmosphere. It’s also much cleaner than other energy forms. Propane releases less CO2 than any of the major fuels besides natural gas, but it’s also not a source of greenhouse gas. Propane contains virtually no particulate matter — a known carcinogen — and is wholly non-toxic. Even in the event of a leak, it won’t harm the air, water or soil.
And this is just the beginning of propane’s role in a green future. Today, facilities in multiple states are producing renewable propane. Renewable propane is molecularly identical to fossil propane, but it’s made using organic material like animal oils, vegetable oils, biomass, and plant matter. This feedstock is abundant, inexpensive, and requires low energy to convert. The resulting renewable fuel can have one-half to one-quarter the carbon intensity of conventional propane.
One particularly useful component of some renewable propane is Dimethyl Ether (DME). Captured from carbon in the atmosphere, DME can combine with conventional propane to form a more renewable and less carbon-intense fuel. Over time, you can expect to see 100% renewal propane used in homes, businesses, farms and vehicles.
Lawmakers, regulators, utilities and other stakeholders across this country are currently setting clean energy benchmarks aiming to get us to a net-zero-carbon future. Yet the timelines to achieve this are long. Conventional and renewable propane, however, are here today and only getting more plentiful. They are integral to any balanced green energy plan.
Want to know more about advances in renewable propane? Drop us a line for more information.
Renewable propane is at the forefront of a worldwide quest for cleaner energy sources with a smaller carbon impact.
Residential propane demand is on the rise, accelerated by the current real estate and construction booms. When it comes to residential construction, adding propane appliances to homes has become a popular practice. Propane gas is becoming increasingly popular among homebuyers for its energy efficiency and the amenities it provides such as gas cooking and fireplaces. In homes, propane is being used in the place of electricity or oil for home heating.
The demand for propane in the United States is predicted to reach more than 10 billion gallons every year by 2025.
Renewable propane can not only help meet that demand, but it also gives us a dependable, secure domestically made energy source. It reduces our reliance on imports from other countries as well as aging, poorly maintained, fragile utility infrastructures.
Propane is already environmentally beneficial since it’s produced in the United States and burns cleanly with negligible greenhouse gas emissions. Renewable propane takes our effort to become more sustainable one step further.
Renewable propane is a by-product of the renewable biodiesel process. Propane has been extracted from renewable resources like biomass, animal fat, vegetable oil, and other triglycerides in projects in both Europe and the United States.
This method of producing propane is as safe, cost-effective, and dependable as that for propane generated from natural gas. When compared to electricity, renewable propane has a considerably smaller carbon footprint.
Homes and businesses all over the U.S. will be able to easily use renewable propane. It is molecularly identical to propane, so there will be no need to replace or alter existing propane appliances and equipment. As usage of renewable propane increases, it will reduce our greenhouse gas emissions nationwide, helping fight the effects of climate change.
Commercial uses for renewable propane will create a big, positive impact both in terms of the environment and business success.
Advanced technologies are now available for ultra-low-nitrogen-oxide engines. These and other improvements will bring about significant environmental and public-health benefits, particularly in the areas of transportation and stationary engines utilized in transportation and equipment used in all kinds of industries.
Renewable propane can also be blended with propane and utilized in existing propane-powered equipment and vehicles, as well as cars run on propane autogas, because renewable propane is chemically identical to propane. This will reduce air pollution and diesel particulate matter substantially. Cleaner burning renewable propane can also help engines and equipment to run more effectively, resulting in longer life with less upkeep and fewer repairs. Businesses may benefit from tax credits at both the federal and state levels.
Renewable propane is an exciting prospect for a cleaner, greener future for energy. Contact us to learn more about the Renewable Propane Alliance.
As awareness of renewable propane ramps up around the country, California remains at the front of the pack. A great example of how the state is maintaining its position as a leader in this space is the Innovative Renewable Energy Buildings Act (AB 1559), which addresses several important—and pressing issues—including the clean energy gap between renewable electricity customers and those who are off the grid (as well as many people in between).
The Innovative Renewable Energy for Buildings Act of 2021 would require the California Energy Commission to establish and implement a program to provide financial incentives for the production of renewable propane, including blends with renewable hydrogen or dimethyl ether, which is used as an energy source for buildings in the state.
Joy Alafia, president of the Western Propane Gas Association, walked us through the bill. She offered insight about the strongest points of the bill as well as many of the ways propane offers an “accelerated and equitable path to carbon neutrality.”
This is a bill to provide clean energy equity to communities that currently are not being served with a renewable solution.
A Closer Look: This focus begs the question, Why are some communities NOT being served with a renewable solution? A few factors provide the main reasons. Some communities are off the grid in more remote locations, or they may be in areas where other renewable solutions are just not feasible, according to Alafia, who emphasized the value of providing a renewable energy source to populations whose needs are currently not met. California has taken the steps to provide electricity generated from renewable natural gas. Still, Alafia points out that more needs to be done for those communities that do not get their electricity from the grid. This bill solves that problem.
It will be part of the solution in reducing greenhouse gas emissions.
A Closer Look: Having renewable propane helps to decarbonize our building energy, and, again, provide a clean energy solution for consumers. California has a goal to provide 100% renewable propane in California, for all markets by 2050. That would have the impact of averting 2.2 6 million tons of CO2 emissions, which is the equivalent of taking about 537,000 cars off the road every year.
The strain on the grid is very real. We need a portfolio of clean energy solutions, and renewable propane is part of that mix.
A Closer Look: It’s problematic for vulnerable communities that rely on electricity in order to operate. It poses a challenge for businesses. “I’ve experienced a few power shutoffs during the business day,” said Alafia. “That affects our productivity, which I’m sure will be tied to our GDP…I’ve gone to city council meetings where small business owners have expressed frustration on the impact to small shops having to shut down because of power outages and the like. It’s a real problem.”
For those who are on the grid, there’s still the need for supplemental clean energy solutions.
A Closer Look: “I’m really excited about the opportunity to have integrated clean energy solutions working comprehensively to satisfy consumers’ power needs,” said Alafia. Right now, consumers in California and elsewhere are being asked to conserve their electricity consumption due to strain on the current grid.
Electricity costs are on the rise.
A Closer Look: “We do have both an energy crisis and housing crisis in California,” said Alafia. “This is why it’s really important to provide affordable, clean energy solutions in our state. Right now, the average home in California is $814,000. And unfortunately, electricity costs in many areas are increasing by high single and/or double digits. So that’s another reason to provide other, more affordable energy options, and propane has historically not seen such a steep increase in costs to consumers so they’re better able to manage their energy costs.”
The renewable propane industry offers a logical way to transition our workforce to green jobs.
A Closer Look: The United States seeks to transition to a green economy. This is a fantastic way to convert blue-collar jobs to green-collar jobs. There’s no new skill set required for distribution and propane workers—it’s the same molecule.
Households will feel the difference.
A Closer Look: About 70% of the homes in California were built before 1980. That’s important because a lot of building regulations in our state that deal with energy efficiency were not introduced until after 1980. So these homes are going to be some of the toughest to decarbonize, or make more efficient. And renewable propane provides, again, an option, part of the solution for how to reduce greenhouse gas emissions for the existing homes.
“We have the capacity, right now, to potentially produce enough renewable propane to satisfy our entire building market by the year 2025, but it’s not going to happen without this legislation,” said Alafia. “What renewable propane can do that no other renewable solution can do is, kind of, a cost effectiveness for carbon reductions. We could do it quickly and cheaply. It’s one of many investments that we need to make.”
What topics in the world of renewable propane would you like to see us cover? Let us know!
One of the primary missions of the Renewable Propane Alliance is to establish a supply chain for renewable propane by linking together Renewable Propane Producers > Wholesalers > Retailers > Consumers. That supply chain has missing links in most parts of the country and the opportunity to purchase renewable propane is not reaching potential consumers. As we work to reverse this, the industry needs to see an uptick in the three A’s: awareness, advocacy and adjustment.
Tom Jaenicke, vice president of propane marketing for Warm Thoughts Communications, and a founding member of the Renewable Propane Alliance, weighed in on these important issues.
We’ve identified four major areas where the first A, awareness, can really make a difference.
Advocacy is a key component of awareness, and it’s up to us within the propane industry to move the effort forward. A real need for subsidies and benefits exists and advocacy is the way to make that happen. Establish lobbying efforts for renewable propane to get similar subsidies and benefits that other forms of renewable energy have.
Producers of renewable fuels, such as biodiesel, Bioheat® fuel and ethanol need to adjust their production facilities and business plans to include the production of renewable propane as demand increases. This needs to happen in many more geographic areas of the country.
Only a few producers of renewable fuels are willing to gear up production on renewable propane. The propane retailers who find those sources will have more success in selling to end-users. The trouble is, a few obstacles stand between renewable propane and potential end-users.
At this point the cost of production of renewable propane is higher than that of conventional propane production. This price disparity is a sales barrier to some. Potential solutions include the following:
As these factors improve, consumer demand and price will no longer be a barrier.
Simply put, a keep-dry contract is a guarantee from the propane retailer to the renewable fuels producer that the propane retailer or other purchaser will buy all the renewable propane being produced over a certain time frame, such as a year. This agreement gives assurance to the producer that they can set up and go into production of renewable propane with a guaranteed sale at an agreed upon price of all that is produced.
Getting propane wholesalers involved in working with multiple renewable propane producers to aggregate production for sales and trades to retailers will open up more of the marketplace, especially to smaller retailers.
With awareness comes favorability. Then comes demand. At that point the expanding market for renewable propane will be a challenge for producers and wholesalers to keep production in sync with demand. Most likely we will continue to see a price differential between renewable propane and conventional propane but the favorability factor of renewable propane will overcome a moderately higher price.
We recently interviewed Joy Alafia, president and CEO of the Western Propane Gas Association (WPGA); Leslie Anderson, president and CEO of the Propane Gas Association of New England; and Tom Jaenicke, vice president of propane marketing, Warm Thoughts Communications, who are among the founding members of the Renewable Propane Alliance.
They offered helpful context around renewable propane as a general term, what the Renewable Propane Alliance is all about, why it’s important and who is involved.
“Renewable propane is quite simply propane that is derived from sustainable sources,” says Alafia. “Currently the most popular and viable way today, is generating renewable and sustainable propane from things like animal fat and vegetable oil.”
The importance of this cleaner, greener fuel for the near—and not so near—future is certain. Anderson said, “It can be used to offset another energy source, which reduces our overall greenhouse gas emissions.”
“Conventional propane already plays a significant role in reducing carbon emissions when replacing more carbon intensive fuels and as the availability of renewable propane increases, it brings with it the potential for net-zero carbon emissions from a sustainable energy source,” says Jaenicke.
Supply is another important issue. “Of the 10 billion gallons of propane sold in the U.S., only four to five million gallons last year was renewable propane,” Jaenicke states. “The purpose of the Renewable Propane Alliance is to work with producers, wholesalers and retailers to identify the demand and increase the supply of renewable propane, no matter where you’d like to market it across the country.”
Alafia adds, “Another key role for the Renewable Propane Alliance is to educate consumers on the evolution of the propane industry. Many companies are looking for ways to reduce their carbon footprint, and renewable propane provides them with that avenue to achieve their own sustainability targets.”
Ultimately, at this point in time, the first goal of the Alliance is raising awareness about renewable propane. Anderson says, “It’s important that we educate people about renewable propane, because they don’t know it’s out there and it’s really part of the solution as we move forward.”
She explains that the Alliance includes “all the great thinkers within the industry today, the people that are looking down the road at where our industry is going to be—five years, 10 years, 20 years from now.”