Kansas Propane Customers Expect Winter Prices to Skyrocket Source: Knight Ridder/Tribune Business News Publication date: 2000-11-17

Nov. 17--LAWRENCE, Kan.--With the onset of cold weather, people who rely on propane likely will see heating bills skyrocket, especially if there is a typical Kansas winter. Lawrence-based Heetco Inc. serves 6,000 propane customers in a 100-mile radius and has branch offices in Overbrook, Leavenworth and Topeka.

Monte Milstead, Heetco's vice president and general manager, said customers already have been hit by higher prices. Propane gas cost $1.04 per gallon Thursday, compared with about 89 cents per gallon last year. The average propane tank holds 500 gallons. That means customers can expect to pay an additional $75 per tank filling this year, if prices stay put.

"If we have a hard winter and crude oil and natural gas prices go up, then the price of propane will go up," he said. "How much, I have no idea."

In September, UtiliCorp United, which provides natural gas service in Lawrence, raised its rates in Kansas. To the average Lawrence residential customer, the 8.7 percent increase will mean a monthly bill of $57.13. By comparison, the price of propane has gone up about 16 percent.

Milstead said he expects natural gas prices to continue to climb. That in turn affects the price of propane because it is made from natural gas and crude oil.

"We won't be raising our prices unless the wholesale prices go up. We're not getting rich off this by any means," he said. "I know it's going to be a struggle for low-income people."

According to the Lisle, Ill.-based National Propane Gas Assn., 57 percent of the 8.1 million American households who use propane rely on it for their primary heating fuel. Propane is normally used in rural areas not serviced by natural gas lines.

Some Heetco customers already have taken steps to avoid sharp hikes when winter strikes hardest.

Rural Lawrence resident Kelly Garrison signed up for Heetco's pay-in-advance plan in August and secured her winter supply of propane when it was still 89 cents a gallon.

"We had heard right before we signed up from someone that the prices were going to go up well over $1.20 a gallon," she said.

Margaret and Norbert Grosdidier, retired Eudora farmers, also bought their propane gas when it was cheaper this summer. Now, they said, they hope to make it through winter on their single tank.

"We're trying to be conservative. You turn down the heat in the evening and you have it set to come on in the morning," Margaret Grosdidier said. "You wear an extra layer of clothing and you cover up with blankets."

The higher cost of propane and natural gas is good for those selling wood-burning stoves.

Kirsten Roussel, owner of Spa Pool & Fireside, 1033 Vt., said she expects to sell at least 70 stoves this year.

"It has picked up because the weather is finally getting cold and the anticipation of natural gas and propane prices (increasing)," she said.

Roussel offers a variety of stoves ranging in price from $650 to $2,600.

"You can heat a whole room or a whole house," she said.

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-- Martin Thompson (mthom1927@aol.com), November 19, 2000