Crane Rule, Jones Act Central Issues of Propane Days

As the National Propane Gas Association (NPGA) prepares to host Propane Days June 3-6 in Washington, D.C., exemptions from several rules that most in the propane industry find very unnecessary and costly are the key challenges to discuss with lawmakers. In the case of both the Occupational Safety and Health Administration (OSHA) Crane Rule and the Jones Act, which will be discussed in detail with lawmakers, no one is strongly advocating why it is beneficial for the federal government to require the propane industry to follow these rules.

“Inertia and resistance to changing anything in the final OSHA Crane Rule is what we’re up against,” said Phil Squair, senior vice president of public and governmental affairs at NPGA. “The Jones Act is different though, because many see exemption proposals as a foot in the door for implementing more exemptions for a wider array of groups or products.”

In the case of the Crane Rule, OSHA originally implemented a three-year delay of enforcement, followed by a fourth year, to allow time for the agency to make changes to the final rule. NPGA believes that third-party certification of crane operators should not be required as the size of the cranes used is limited since they are utilized simply to move and set tanks. “It has been common sense all along that the simplicity of the propane technician’s task shouldn’t be treated the same way as people who work with huge cranes on the top of skyscrapers,” Squair said. “Nonetheless, after over three years now, OSHA has taken no action on this rule except waiving compliance for a fourth year.”

With the waiver set to expire again this year, propane industry leaders are concerned about members ultimately being mandated to take extensive and costly certification of crane operators. “OSHA still does not have an administrator,” he explained. “Employees of agencies with no leader have no ability or incentive to implement policy changes. That’s the mud we’re stuck in at OSHA.” Squair believes Propane Days is an event that can convince Congress to take action to end the stalemate with OSHA. “Congress members understand and appreciate the cost and time associated with our industry members coming to town to talk about issues that affect how they run their businesses back in their home districts. A lot of push behind specific issues can really get their attention and cause progress.”

The Jones Act is another issue that has hampered the propane industry from efficiently serving customers. While this century-old law stays on the books essentially to appease ship builders and dockworkers, a waiver for the propane industry would have a net positive effect on the U.S. economy. The law states that only U.S.-built vessels may carry products from one U.S. port to another. However, in the case of propane, there are no U.S.-built vessels for shipping the fuel. Compliance with this law means U.S.-produced propane cannot be shipped from U.S. ports in the Gulf of Mexico or even Puerto Rico directly to the Northeast when needed to alleviate a shortage of product. Instead, propane from outside the U.S. will often need to be imported from another country.

New England propane marketers are particularly motivated on this issue as their region stands to gain the most by making changes to the Jones Act. “New England just had another tough winter. It was extremely cold, and they have infrastructure issues and driver limitations,” Squair said. He pointed out that neither the OSHA Crane Rule nor the Jones Act are particularly partisan issues. In the case of the Jones Act, the lawmakers representing coastal regions will typically be strong on their support of the Jones Act while inland legislators will tend to be less supportive.

“Propane Days will be a great time to educate Congress members on the Jones Act and its impact on citizens in their districts who cannot get a maritime shipment of U.S. propane from a U.S. source,” Squair explained. “Senator McCain actually has proposed legislation to get rid of the Jones Act altogether. While we would be fine with that, we feel a waiver just for the propane industry might be our most reasonable outcome.” He added that many in the maritime arena want no waivers for anyone as they see them as leading to more waivers for a broader section of the country.

In addition to sharing concerns about the OSHA Crane Rule and Jones Act compliance, marketers will be encouraged to ask for continuing alternative fuels tax credits. “It helps the propane industry and our customers if these tax credits stay in effect rather than being allowed to expire. They are effective in boosting demand for propane technologies, which increase American energy security and reduce environmental impacts of traditional fuels,” Squair said. Propane Days, as always, will have a few well-known speakers. This year political analyst Larry Sabato, a Robert Kent Gooch Professor at the University of Virginia, will deliver a keynote speech. “I am also looking forward to having a leader from the Hill speak as well,” Squair said. —Pat Thornton