The Bee Cave Bee

My propane bills have been through the roof. From Nov 2009 through April 2010, I paid almost $2,200 in propane bills. I live by myself and only use what I think is minimal propane.

Late spring I read an annoucement for a new propane company that opened on Debba Lane. I stopped in there to ask if propane was relugated by any state agency and was told The Texas Railroad Commission regulates them. I told the gentleman that I thought I might have a leak and he offered to come out and do a leak test. As I was leaving, I asked him how much he was charging per gallon for propane. He told me $2.15 a gallon.

When I got home, I checked my last statement from Ferrell Gas and it blew me away. They were charging me $3.92 a gallon. I now have a new propane company! He also came out to my house and did the gas test. I had no leaks. I was just being ripped off.

My new propane company is Absolute Propane. The man I spoke with is Thomas Rut. 266-7383

We all need to review things like our cable TV, auto insurance, cell phone bills, etc at least once a year. It's easy for these kind of companies to slowly inch their charges up on us without us really paying much attention. I recently review all mentioned above and was able to lower every single one of them to the tune of about $125 a month collectively.

Just food for thought!

Sonterra was replaced by Alliant Gas which is divided between Dallas and San Antonio. The new owners were one of the communities served by Sonterra - Cordilleria Ranch subdivision in Boerne. They have started off by raising the rates 15% while the wholesale price of LP has fallen.

Larry Fox
President MUD #5 (Lake Pointe)

Ron, I think you have your own individual tank. You can get propane from more than 1 source. For people in the neighborhoods that are organizing, they are hooked into a central tank which is owned by a company that has a monopoly on the neighborhood. In many cases the poeple in these neighborhoods are deed restricted from even having their own tank. They have no options. And, the developers often participate in the revenue - they get a percentage off the top, of everyones' propane bills. The agreements between the developers are kept secret, and are not disclosed at the time of purchase. It is really dispicable and it should be illegal. That's why we are organizing to get propane regulated.

Yes, the old stinkers (Sonterra) have been replaced by new stinkers (Allied Gas). The cause of the problems is that the laws allow these unregulated monopolies in the communities they "serve" and the developers get a cut! This is what happens whey you have unregulated monopolies!

Propane is by far the most expensive way to heat your home. Btu for Btu, propane is 4x the cost of natural gas. The fact that natural gas raw material cost is much lower than propane seems to be the reason that people accept that their propane company's cost to deliver propane also dwarfs the cost the natural gas company charges for delivering natural gas. Let's take the situation for a single home, mine, on propane, versus another home, my friend's, on natural gas, for last month, for example. I used a lot less. Measured in cubic feet, I used about 1/4 of my friend, 400 cubic feet versus 1700 cubic feet. Propane has 2.5x the heat producing potential, but even so, I received only about half as much heat (btu's). My bill was $43.16. My friend's was $22.00. So, I paid twice as much for 1/2 half as much heat. If I am an average customer for propane, and my friend is typical for natural gas, and you take the time to look at the amount of money the propane company and natural gas company have left over after serving us, you find that, after subtracting the cost of their raw materials which is the Henry Hub price for natural gas, and Mont Belvieu price for propane, the propane company has 2-3x the amount of money left compared with the natural gas company after subtracting what they paid for their raw materials. So, either the propane company is making a lot more money per customer, or they are much more inefficient in delivering propane compared to the profit/efficiency in delivering natural gas. Overall, just accepting the price of propane because propane is more expensive to create, since the wholesale price is higher, and not challenging the propane providers to deliver propane efficiently, is just not looking deeply enough into the situation, something the propane providers are probably very happy to have their customers do.

Lz,
I agree and I understand. I wish I was doing business with a mom and pop company that really cared. Also, definitely, propane is refined so it will always be more expensive than natural gas. But, on the other hand, if you call around, as I have, and talk to people who have been privy to the dealings of these "monopolies with no price regulation," which are the companies that own the central propane gas distribution systems, you would hear about secret agreements, like in Falconhead where the developer won't share the agreement he has with the propane company - residents aren't allowed to see it. And in other communities you will find that you can see actual documents proving developers took 10% or 20% of the propane revenues for all of the homes in a neighborhood, in perpetuity, such as in Senna Hills, and Lake Pointe. And you would see that there have been tank fires as in Senna Hills, and service interruptions in the coldest parts of the winter last winter as in Senna Hills, and 5 ownership changes in the last 10 years, and employees of these companies that don't know where the shutoff valves are to turn off the propane when it is blowing wide open into the air beside a home as happened in Lake Pointe. And, I don't think you would be as sure that these community providers are really good guys. My estimate is that regulation would lower the price 20-25%. Natural gas is 75% cheaper so it still doesn't get close, but I don't want to send my money to a bunch of wild, wild west operators who have monopolies with no price regulation and are possibly endangering lives with their incompetence and have a bunch of fat cat investors taking big slices of profit off the top. Please accept my invitation to join the Centexpropaneregulation group and i can give you access to many, many people and documents that will cause you to reevaluate your positiveness at least as far as these monopolies without price regulation. I repeat, Mom and Pop's are just fine with me. I wish we were dealing with a Mom and Pop. I really, really, really wish it.

Agreed, regulation is the only answer, the problems are not only in Texas but all across this great nation. I'm a realtor and see the poor services and over charges all the time. I am relocation to Austin in the next three months and refused to have my home heated by propane, sure they charged me a penalty of $3,000.00 but I should see that savings in less then 2 years. The builder didn't get me.