You may recall the 2006 television ads that featured the “Energy Guys.” In the ads, two 30-something males represented the propane and electric industries. The brawny guy wore a T-shirt with “Propane” across the front. The other was a lanky guy wearing a T-shirt representing “Electricity.” These television and radio advertising lampoons were intended to persuade users of electric ranges, water heaters, home heating and other electric appliances to switch to propane-fueled appliances.
I must admit the ads were cleverly funny even though they were picking on the “electricity” guy. What the ads didn’t mention was the propane industry had an abundant inventory at that time. That plentiful inventory was also a contributing factor for low wholesale and retail prices. The price dip also led to low revenues and profits for their industry. These economic circumstances prompted the propane industry to launch a nationwide fuel-switching campaign with the hopes of building market share while increasing sales and profits.
The next eight years would bring a rollercoaster of price fluctuations for those who made the switch to propane. Also, historical data reveals inventory shortages and staggering, record-high retail pricing for propane during the winters of 2008 and 2014. Some areas in Arkansas experienced propane prices that exceeded $5 per gallon during the winter of 2014.
Fast forward to 2016. Propane inventories are abundant once again, in part because it is a byproduct of oil and natural gas production. Also, much of the nation is experiencing a near-normal winter, and heating requirements are lower than the two previous winters. The reality of an abundant supply and less consumer demand has once again attributed to a glut of propane in the United States, creating a market similar to 2006. And that means there is a pretty good chance you’ll be seeing television and radio ads with a similar fuel-switching message, with an emphasis on water heaters. However, before you switch from electric to propane, please consider these facts:
- Electric heat-pump water heaters are up to four times more efficient than standard propane models.
- The Energy Factor (EF) for standard 40- and 50-gallon electric water heaters average .90 and higher. Propane models average .62 and lower. Propane and natural gas furnaces, dryers and condensing-style water heaters require electricity for operation.
- A common complaint for propane on-demand or instant water heaters is inadequacy to meet high hot water demand.
- Electric water heaters are safe and do not require flames to heat water.
- Electric water heaters are very easy to install.
- Electric water heaters do not require a fluepipe and eliminate any chance for back-drafting carbon monoxide into the home.
- Electric appliances operate on electricity generated from a mix of resources including wind, solar and hydropower.
- The cost for an electric kilowatt-hour is much less volatile than the cost for propane.
- Cooking with propane requires ventilation to remove unwanted moisture, carbon monoxide and other gaseous byproducts from combustion.
- Propane appliance users should consider installing carbon monoxide detectors on every floor of your home including basements and garages. Detectors should be installed within 10 feet of every bedroom door.
Please feel free to contact me at firstname.lastname@example.org with any energy efficiency questions. Also, be sure to follow us on Facebook at www.facebook.com/smartenergytips.org as well as listen to our podcasts.
Bret Curry is the residential energy marketing manager for Arkansas Electric Cooperative Corporation (AECC).