Propane supply dwindles, prices skyrocket amid arctic blast in Indiana

Photo by jasonwoodhead23

Indiana lawmakers want to exempt sales tax on propane

By Rick Yencer

INDIANAPOLIS, INDIANA (NEWS)  - The ongoing arctic blast in the Midwest has reduced propane supplies while the cost has skyrocketed.

And that supply and demand has caught the attention of Indiana lawmakers who want to exempt sales tax for propane use.

In recent weeks, the average price of propane has gone from $3.69 a gallon to as much as $5.50.

Brian Donahue, owner of Donahue Gas in Muncie and Anderson, said supply also has been limited by demand during the winter. Instead of six loads of propane a week, Donahue has been getting three.

A huge underground cavern near Huntington is storage and supply for much of the propane in eastern Indiana and western Ohio.

Donahue, whose family has been in the propane business since 1938, said a record demand has driven up prices.

The U.S. Energy Information Administration reported that propane had been selling at a historic high of $2.98 a gallon this week in Indiana, but as Donahue documented, the cost is over $5.

U-Haul that also has operations in Muncie and elsewhere in Indiana has no problem getting propane. The coast to coast hauling company can also haul propane across the county.

Sabrina Gosser, manager of Muncie's U Haul, reported a $3.69 a gallon at the propane pump and the business on Martin Luther King Jr. Boulevard just got a new load on Tuesday.

Gosser thought it was nice that lawmakers would consider a sales tax exemption for propane, given many people depend on the fuel to heat.

Sen. Doug Eckerty, R-Yorktown, is among Republican lawmakers who proposed amendment to Senate Bill 1 to exempt sales tax on a gallon of propane costing over $2.50 a gallon. If passed, the credit would be available on their next propane bill. It would be effective during January to March.

Sen. John Waterman, R-Shelburn, said many Hoosier families experienced high prices for propane and needed help with heating bills.

Some schools and other institutions that use propane also have experienced higher prices and short supply.


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