Propane suppliers quietly reduce size of refills
AP Energy Writer
DENVER, Colorado ” Backyard grillers may get a little steamed this holiday weekend when buying refilled propane tanks: They will be getting less fuel for their money than last Memorial Day.
When oil prices soared in 2008, propane suppliers quietly reduced by two pounds the amount of gas pumped into each 20-pound tank, saying they wanted to avoid raising prices.
Since then, propane prices have been cut in half as the price of oil has dropped. But smaller refills are still being sold nationwide by many dealers, and most buyers are unaware because the tank is the same size.
“It’s a price increase,” retired lawyer Stuart Barr said Friday as he swapped a tank at a Home Depot store in Denver. “I’m a great believer in full disclosure. Give me the information.”
The problem, consumers say, is that no one tells them they’re getting less propane. Companies have adopted similar practices in the packaging of coffee, sugar and laundry detergent.
“I’m not surprised,” said Tammi Dorsey of Denver. Carrying a tank of propane from a store Friday, initially unaware that she got less this time.
For the past year, tank exchanges at retail stores have generally cost $20 to $25. For a few bucks less, consumers can take their tanks to some stores to get them refilled instead of exchanging them. Those refills usually contain the full amount of fuel allowed by law.
Until last year, Blue Rhino and Amerigas, two major suppliers, put 17 to 18 pounds of propane in each 20-pound tank. Tanks should not be filled completely for safety reasons.
About a year ago, that amount was cut to 15 pounds to save consumers a price hike, Blue Rhino spokesman Chris Hartley said.
“There are a number of companies in different industries across the country addressing product packaging, just because of the soaring costs,” he said.
Last year, all energy costs increased sharply, as did the price of steel used in tanks. Crude prices soared past $100 per barrel at the start of 2008 and climbed toward $150 by July. Propane futures hit $1.95 per gallon in the same month.
Those prices have all fallen this year, which would suggest bigger profits for propane distributors.
Hartley would not say if there were plans to return propane refills to the same levels as before the 2008 price spikes, but he did say that energy markets remain volatile.
In the last year, propane futures on the New York Mercantile Exchange have dropped from about $1.73 per gallon to just above 71 cents. They have climbed 11 cents since January.
Retailers who offer propane say they have not increased the volume of fuel in each tank because propane companies have not reduced prices.
Home Depot, which offers propane tank exchanges, said cutting the amount of propane in 20-pound tanks was an industrywide measure.
There have been no customer complaints, spokeswoman Jean Niemi said.
But Jose Rivera of Denver did the math in his head and concluded that the extra money spent on propane could have helped pay for other cookout supplies.
“That’s some steaks,” he said.