Following the introduction of the NAT GAS Act last week, the propane industry came out swinging, asking legislators why propane autogas had been excluded from the bill.
“The transportation industry has already embraced a variety of alternative fuels such as propane, which is domestically produced and provides the same environmental and economic benefits as natural gas,” Curtis Donaldson, Founder and CEO of CleanFUEL USA said in a press release. “If the U.S. is serious about energy independence and reducing our carbon footprint, we need to remain fuel neutral and preserve the freedom for consumers to choose from a menu of alternative fuels,” he added.
The industry push-back sparked media interest in autogas, and Connecticut Post reporter Vinti Singh interviewed multiple propane company heads about the NAT GAS Act. The article, “Propane industry miffed by exclusion from federal alternative fuel legislation” (4/10/11), quoted AFA Founder and Alliance AutoGas President Stuart Weidie regarding the competitive pricing of autogas. “Like natural gas, propane is cheaper than gasoline. Currently, propane-fueled vehicles in the U.S. pay $1.25 less per gallon than they would for gasoline,” Weidie had explained to the reporter.
Following the article, the president of the Independent Connecticut Petroleum Association sent a rebuttal to the figure Weidie quoted. Citing a Connecticut study that surveyed propane prices for residential heating, adding in other ‘fuzzy math’ while omitting the 50-cent-per-gallon alternative fuel tax rebate for autogas, the ‘real’ price of autogas is supposedly $4.82 per gasoline gallon equivalent of autogas.
Not so fast, replied Weidie. That grossly exaggerated figure is typical of the confusion surrounding alternative fuel pricing, he explained.
“A common misconception is that autogas costs the same as retail propane. This is not correct. Autogas is the name for propane that is used as vehicle fuel – it has a different name and a completely different pricing structure. Because of volume and economies of scale for fleet customers, the cost of autogas is not reflective of the prices of propane for residential, agricultural and commercial/industrial applications. The data provided by the Petroleum Association comes from a report that clearly indicates it lists propane ‘prices for home heating only’ – that is, the price of propane delivered to individual homes,” Weidie noted.
Weidie’s response then quoted actual autogas prices that real fleets are paying across the Northeast, Mid-Atlantic and Midwest. A survey of real autogas and gasoline prices follows:
*Note: These figures show the per-gallon autogas price WITHOUT the 50-cent-per-gallon credit in the price.
Averaging these prices, factoring in the 50-cent-per-gallon rebate, and even taking into account a 10% reduction in fuel economy versus gasoline, the “average price of autogas per gasoline gallon equivalent [gge] is $1.69 less than gasoline – substantially more savings than the figure of $1.25/gal that I gave you before,” Weidie showed.
The real cost of the $4.82/gallon figure might be more than just a little misunderstanding, though. “Misinformation damages our nation’s progress toward energy security. Well-written articles like the one you published Sunday are a great step toward raising awareness about this clean, affordable, abundant and American-made fuel that more fleets should be using,” Weidie wrote to the reporter.
See the full debate and calculations here.