What is Propane?
Propane — sometimes known as liquefied petroleum gas, or LPG — is a gas normally compressed and stored as a liquid. It is nontoxic, colorless, and virtually odorless; an identifying odor is added so it can be detected. Propane is most commonly used for space and water heating, for cooking, and as fuel for engine applications such as forklifts; however, its applications are rapidly growing due to new technology developments. When used as vehicle fuel, propane is known as propane autogas.
Where Does Propane Come From?
Propane is primarily a byproduct of domestic natural gas processing, though some propane is produced from crude oil refinement. U.S. propane supplies are becoming increasingly abundant due in large part to increased supplies of natural gas.
- As shale gas extraction has increased, the production of propane from crude oil refinement has dropped dramatically. In 2011, 69 percent of the total U.S. supply of propane came from natural gas liquids produced in the U.S. and Canada.
- Strong growth in propane supply is expected to come from the Marcellus shale play in the northeastern U.S. Industry observers estimate the Marcellus shale alone can supply more than 2 billion gallons of propane per year.
- Because of the drastic increase in U.S. sources of propane, the U.S. produces more than enough propane to meet current demand and became a net exporter of propane in 2011.
Who Uses Propane?
Propane is used in 48 million households as well as many businesses for water and space heating, indoor and outdoor cooking, clothes drying, and backup power. Additionally, many industries increasingly choose propane to cost effectively fuel vehicles and equipment while lowering emissions.
How is Propane Distributed?
With up to 56,000 miles of pipeline and nearly 6,000 retail dealer locations nationwide, propane is widely available and easily portable.
For on-road use, there are more fueling stations in the U.S. for propane autogas vehicles than there are for vehicles of any other alternative fuel except electricity. Propane is the only alternative fuel with fueling stations in every state.
How Does the Propane Industry Contribute to the Economy?
The propane industry generated nearly $15 billion in direct domestic value in 2009.
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