Legislation Creates Transparency for Community Propane Systems
AUSTIN – State Representative Paul Workman passed House Bill 2532 in the Texas House of Representatives to increase transparency for ratepayers living in neighborhoods with community propane systems.
Community propane systems operate with a centralized propane tank that provides propane to homes through underground piping. These systems are largely unregulated, with the Railroad Commission only having jurisdiction over the safety provisions of the storage tanks and the underground lines. The commodity itself is completely unregulated.
Rep. Workman said, "There are approximately 78 community propane systems in Texas, over half of which are located in House District 47."
Customers of these systems have no way to negotiate contracts or pricing, and there is limited ability to address complaints about service. In many cases, homeowners are prohibited from converting to all-electric systems or installing their own propane tanks on their property because of deed restrictions. This is particularly troublesome given that there have been instances of service outages over the last few years. One of these outages left families in House District 47 without heat for two weeks in December 2010.
H.B. 2532 creates a pricing structure so that ratepayers and providers alike have certainty on pricing without creating expensive rate-making regulation. The pricing structure relies on free market data gathered by the U.S. Energy Information Agency. The legislation also provides protection for homeowners in the event that a tank runs dry.
"This legislation is the result of working with my constituents and the industry over the last two years to create a system that is fair to everyone," concluded Rep. Workman.