PERC Executive & Advsiory Committee Updates

PERC Executive Committee Update
A new executive committee conducted its first official business at PERC’s Summer 2015 meeting in Utah.
PERC logo

Joining incoming chairman Tom Van Buren on the new executive council are vice president for marketers Drew Combs of CHS Inc. (Inver Grove Heights, Minn.); vice president for producers Bruce Leonard of Targa Liquids Marketing & Trade (Southlake, Texas); secretary Bob Barry of Bergquist Inc. (Toledo, Ohio); and treasurer Rob Chalmers of Meritum Energy Holdings (Southlake, Texas).
In other business, the council announced newly appointed councilors Randy Doyle, Daniel Dixon, and Kasib Abdulla. Re-appointed councilors include Sam Holly and John Simcox.

The next council meeting is scheduled for Nov. 5-6 in Boca Raton, Fla.

PERC Advisory Committee Update
Offering more details on PERC’s post-restriction plans, Scott Brockelmeyer first provided an update on PERC’s advisory committee, which now includes 97 members, representing 69 companies in 31 states. Members are primarily propane marketers but also include equipment manufacturers, equipment distributors, and a small number of state association executives and directors. The advisory committee, which has added 17 new members since January, includes three working groups: market outreach and training (MOT), research and technology development (RTD), and safety and training.

The advisory committee, meeting in April in Austin, Texas, participated in a strategic planning exercise for members to express their views of how the council should proceed in a post-restriction environment. Overall, Brockelmeyer noted, members of the group feel confident that PERC is talking to the right people in the right markets.

The committee’s safety and training working group will focus on developing technician training, specifically for the autogas market. The working group is developing the training in conjunction with the National Alternative Fuels Training Consortium and is expected to roll the program out over the next year. The working group is also working on refresher training and is developing a strategy for delivering safety and training materials electronically.

PERC Consumer Awareness Projects Build on Commercialization Efforts

As it moves forward to resume its consumer education program, the Propane Education & Research Council (PERC) in July announced the formation of a consumer awareness task force to promote gallon growth by building on the council’s commercialization efforts over the past five years.

Since the U.S. Department of Commerce (DOC) placed a restriction on PERC’s consumer education program in 2009, the council has refocused its efforts on research and development and safety and training. Following years of work by the National Propane Gas Association and the propane industry to convince legislators of the importance of the council’s public education programs, DOC lifted the restriction this past April.

After receiving the gavel from outgoing chair Paula Wilson at the council’s annual summer meeting in July in Park City, Utah, new PERC chair Tom Van Buren said PERC’s commercialization efforts have resulted in new product lines that are making a positive impact in the marketplace. He noted, “We can now enhance and develop further and put ourselves in a position of the ultimate end goal, which is [to] increase gallons and improve the value for our industry.”

Scott Brockelmeyer of Ferrellgas (Overland Park, Kan.), chair of PERC’s market outreach and training (MOT) committee, will lead the new consumer awareness task force, which will develop a detailed consumer awareness program for the industry. Van Buren also announced the formation of a new council subcommittee that will focus on managing the portfolio of new products that PERC will seek to commercialize or bring to market.

The consumer awareness task force will first develop the plan, and then for about a year continue to work with PERC’s MOT committee to implement the program. Van Buren said the continued work of the task force will ensure “we’ve got the brightest minds that we can put together,” to provide feedback on areas that need adapting. The group will also continue to review successes and best practices from the past PERC consumer education programs that took place before the restriction was put in place.  

The task force will be marketer-driven with support from PERC staff. It will include the addition of a new chief marketing officer for the council. PERC president and CEO Roy Willis explained during his president’s report that he has been developing the job description for the chief marketing officer, has hired a headhunter, and has begun interviewing candidates. “We haven’t found that ‘wow’ person yet, but I’m going to keep looking until I do,” Willis said.

Rob Chalmers of Meritum Energy Holdings (South Lake, Texas) will chair the new portfolio management subcommittee to the council. The subcommittee will review PERC’s existing project portfolio and monitor the progress of each project. Van Buren believes the subcommittee’s duties are more important now that the restriction on the council’s public education activities has been lifted. The group will also review the council’s existing rebate programs and the partnership with states program.

“We’re in a whole new world from where we were five years ago,” Van Buren noted. “It’s an opportunity to make sure we’re looking at everything within the council to include those two very important programs.”

Drew Combs of CHS (Inver Grove Heights, Minn.), in his first PERC meeting as the new vice chair of marketers, commented on that new world, where PERC can now communicate with the public about propane products and services. But he reminded the attendees of the progress the council has made over the past six years in commercializing and bringing new products to market. He does not want the council to lose that momentum just because it now has the ability again to educate the public.

“Even though there’s a new movement to go to the marketing side, we still have a responsibility to continue down that path to bring equipment and items to the market that can utilize propane,” Combs noted. “I see that being melded into our marketing campaign going forward, maybe a little different than what we’ve done in the past from a marketing standpoint. We can’t let up the accelerator with our customers.”

He also called for an effort to “right-size our industry,” by getting the correct-sized tanks to customers. That is necessary because “We don’t need another black eye in this industry,” he said, referring to the supply and infrastructure problems during the 2013-2014 winter.

“I come from the agricultural side with CHS, and I will tell you first and foremost that our agricultural community is not right-sized still. We have sold a lot of new tanks to that industry, but we have a lot of work yet to do. We are another 2013-2014 winter away from having another issue. We have a lot of product out there, but I think people need to understand, and I go on the record with this, that we are still dislocated with where that inventory is at and where the demand is needed. So to think that we have a plethora of inventory sitting out here that will meet any challenge we have, don’t kid yourself.” The industry must continue to work on better methods to move propane to the end user, he added.

Combs also noted his concern about attacks on the propane industry from outside entities. He mentioned the reversal of pipelines for use by other products as an important issue to be addressed. Increased exports of propane are affecting the industry’s portfolio.

“I see an intrusion by legislative actions in certain states that are impairing our ability to be a true industry that is run by consumers,” he commented. “We need to continue to work together as a community [to show] that this is an industry that cannot be subsidized, and I’m talking about natural gas. We have a responsibility to make sure we educate. We have a tremendous responsibility…as we look to the future…We need every one of us engaged.”

Willis, in his president’s report, stated that the council’s commercialization efforts over the past several years have resulted in many new target markets. The commercialization strategy has resulted in 40 different propane products and applications into the marketplace, with 122,343 units of those products sold. Those units have consumed 283 million gallons of propane and delivered $70 million of value to the industry on a PERC investment of $24 million.

“To me, that’s an indicator that we’re making progress in that area,” Willis noted, adding that the lengthy amount of time required to send an idea to production and then launch it into the marketplace has been a surprise. The lifting of the public education restriction will help in that area.

PERC vice president Tucker Perkins discussed various programs that will receive expanded attention from PERC in the coming months. He began by looking at the housing industry. In this area, PERC staff will increase its work to influence stakeholders in housing, including builders, plumbers, HVAC professionals, and homeowners. PERC’s Let’s Retire Heating Oil campaign will help those stakeholders see propane’s benefits over fueloil. The same goes for an upcoming campaign on geothermal energy.

The geothermal campaign, Perkins noted, “will begin to evolve, but it at least gives our marketers really concrete facts and tools to use to combat a rising technology in most markets, which is geothermal heat.”

PERC’s “Pull the Plug on Water Heating” program has done well, and it will do even better with the lifting of the public education restriction, coupled with April’s change in water heater efficiency standards that made propane a very cost-effective device compared to an electric water heater, Perkins noted.

He went on to cite a statistic showing that 4 million homes that use propane do not have a propane water heater. To take advantage of that, PERC plans a campaign with a celebrity spokesperson to talk about the efficiency standards and other facts to get homeowners to switch to propane water heaters.

Moving to the commercial sector, Perkins said getting the four Kohler propane generators launched to the commercial market is another top priority. The Tier IV final emission standard that diesel products must meet should further help sales of propane products.

He provided an update on the commercial mower market, noting that PERC, working with R&R Products (Tucson, Ariz.), is conducting a pilot program to launch propane mowers into the golf course market. The pilot program recently placed mowers at an eighth demonstration site golf course in Columbus, Ohio. Perkins reported strong initial feedback from the golf courses about the products. The demonstration, which involves about 35 mowers at the eight golf courses, will be about a year in duration.

Willis also included in his president’s report statistics showing that about 7000 propane-fueled school buses are operating in 400 school districts across the country in 45 different states. But that market has great room for growth because about 13,000 school districts exist in the country.

“One of the metrics we might adopt for this new commercialization strategy…is how many of those 13,000 school districts are going to hear from PERC about what a propane school bus fleet can do for their school district,” Willis stressed. “We do have an opportunity to grow those markets…The same could be said for other product categories. The effort to integrate consumer education into our commercialization strategy is going to be one of the more important things this council does going forward.”    —Daryl Lubinsky

Check Those Forklift Cylinders You Never See

When customers bring their forklift cylinders to a marketer’s location for refill, the marketer can check the relief valve on the cylinder to make sure they are up to date. But many commercial customers have their own forklift cylinders that they fill at their own site, and marketers who deliver gas to those customers might not check to see if their forklift cylinder relief valves are in good operation.

“The summertime as far as safety is concerned is a good time to put a program in place to make sure that those cylinders you never see are taken care of,” Pfalser noted.

If the customer is on a forklift cylinder exchange program with a propane marketer, the marketer checks those cylinders regularly because the marketer is doing the filling.

“The ones that we miss are the customers that might have 20 forklifts operating at a mill,” Pfalser said. Those cylinders never leave the customer’s location. The marketers simply deliver gas to a storage tank at the location, and the customer fills his own cylinders. Who is looking at those cylinders? Somebody should, Pfalser stressed.

“Whenever they have a problem, they wait until the relief valve pops off, they set the cylinder aside, and say, ‘I need a new relief valve; one popped off.’ That’s not good.”

There Are Times in Our Lives When We Take a Second Look at Things

By David Donahue…   At times, we take things off the shelf, dust them off, and see they are still important and relevant. The same can be said for our workday policies and procedures — we need to take a look at them from time to time to make sure they still reflect the most current codes and regulations. Two of these items that you need to get off the shelf and take a second look at are your Site Security Plans as well as a Hazardous Communication Plan for your employees.

Site Security Plans
The Transportation Security Administration (TSA) and the Hazardous Materials Regulations (HMR) require every propane company to have a hazardous materials security plan. This plan must identify potential security risks and areas that may be vulnerable while on the job, as well as appropriate measures to address them. Security Plans must provide specific measures to address any potential security risks. These measures will vary depending on the nature and level of the potential threat. Security Plans must be updated whenever there are newly assessed risks. For example, updates may be required when changes to the workplace environment introduce new potential risks. Employees affected by this update of the Security Plan are required to be trained accordingly.

When the requirement for Security Plans first came into effect, security threat levels were based on a color-code system. Plans incorporated these color codes and informed employees to be more vigilant or take different action if the threat levels increased. In 2011, the color-code system was replaced with a two-tier threat level system: Imminent or Elevated. If your Security Plans do not reflect this change and still use the color-code system, you can receive a hefty fine, as one of our member companies recently found out. So take the time and update your plans if need be. Once the Security Plans have been updated, this would be a good time to have a safety meeting to go over the revised format. For a copy of the National Terrorism Advisory System Public Guide you can go to: and search for NTAS Guide or you may contact me at the association office for a copy of the guide.

MSDSs Are Now SDSs
On June 1, 2015, OSHA’s Hazard Communication Standard (HCS) came into effect. OSHA made these changes to bring the HCS into alignment with the United Nations (UN) Globally Harmonized System of Classification and Labeling (GHS). The modified standard provides a single set of harmonized criteria for classifying chemicals according to their health and physical hazards and specific hazard communication elements for labeling and Safety Data Sheets. So just what does this all mean?

Labels that we place on our commercial cylinders must now contain the following information:    

• Product Identifier — relates to the how the chemical is identified
• Signal Word — used to indicate the chemical’s relative level of severity of hazard
• Pictogram — a graphical symbol used to communicate specific information about the hazard of a chemical
• Hazard Statement — a phrase that describes the nature of the hazard and, where appropriate, the degree of hazard
• Precautionary Statement — a phrase that describes the recommended measure(s) to be taken to minimize or prevent adverse effects resulting from exposure to a hazardous chemical

Name, Address, and Phone Number of the Chemical Supplier
Safety Data Sheets (SDSs), formerly known as Material Safety Data Sheets (MSDSs), have a new format under the updated HCS, which now requires 16 specific sections. The main difference between MSDSs and SDSs is that the new format requires sections to be in a specific order, while the MSDSs did not. So take the time and effort to update your Hazard Communication Program. Replace all your old MSDSs with the new SDSs. You will have to also make sure all your commercial customers have a copy of the new SDS for propane. If MSDSs were part of your shipping papers, be sure to replace them with the new SDSs. Other places that might have used MSDSs are Fire Safety Analyses (FSA) and Operation and Maintenance Manuals (O&M). Be sure to update these as needed.

June 1, 2015 was the start date of the new standards, but distributors may ship products labeled by manufacturers under the old system until Dec. 1, 2015. If you would like more information on the OSHA Hazard Communication Standard, the National Propane Gas Association has a white paper on the topic available on its Website,, or you may contact me at the North Carolina Propane Gas Association office for a copy of the paper.

David Donahue is director of code compliance and education for the North Carolina Propane Gas Association (NCPGA). Article courtesy of NCPGA.

Before the Winter Heating Season, Finish Your Bulk Plant Safety Check

Safety has always been important to the propane industry — from the supply terminal, to rail, to the marketer’s bulk plant, and all the way to the end user. “Safety needs to be considered the whole way through,” said Kevin Pfalser, sales representative for Gas Equipment Co. (Dallas). Pfalser’s work takes place mostly at the bulk plant, and as propane marketers begin gearing up for winter, they can use this time before heating season to make sure bulk plant components such as ball valves, angle/globe valves, and hose assemblies, and most importantly, the emergency shutdown system, are in safe working order.
Bulk Plant Safety

“Summertime is the perfect time to take a look at your bulk plant to make sure things aren’t being overlooked,” Pfalser stressed.

To start, marketers should take a look at the yard itself. Make sure grass, weeds, and any combustible material is maintained at least 10 feet from the storage.

“Over a period of time, everyone is busy. All of a sudden you look around and you’ve got weeds everywhere, and if there is a fire, there could be an issue,” he noted. Also check for possible Occupational Safety and Health Administration (OSHA) concerns, such as material around the area that employees could trip on, causing injury.

Check any ball or globe valves in the plumbing, especially if they are used for maintenance purposes. Valves used for maintenance don’t see a lot of use, and marketers don’t think about them much, so the valves can seize up and not work.

“Those valves need to be looked at for free movement and for leaks at the stem, and packing, etc.,” Pfalser noted. The same goes for any valve found throughout the system from the storage to the bulkhead.

Breakaway protection is required at the top of the bulkhead, preventing a driver from pulling away while the bobtail is still hooked up to the tank. Pfalser notes that a minimum of a 12-in. nipple is required at the top of the bulkhead. Marketers should check their local regulations, but Pfalser believes 12 inches is the minimum size. He has seen bulk plants with only a 2-in. to 3-in. nipple, which offers little breakaway protection.

Also at the bulk plant, marketers should check their liquid and vapor hose assemblies for cracks, tears, and general condition. They should also consider protecting the hoses themselves by placing them on loading arms to keep the hoses off the ground.

“Typically, it’s the vibration of filling the bobtail — if the hose comes in contact with the ground — that leads to premature failure,” Pfalser explained.

Moving the focus toward the bulk plant storage tank, check the pump. If a leak is found, repair it. In addition to checking it for safety, check it for efficiency. The end of the summer season is a good time to make sure the pump is building differential. If it’s not, it’s costing the marketer in loading time, so it’s a good time to pull the pump down and rebuild it if needed.

Marketers should check the flex lines installed between stationary points such as the pump and the bulkhead for bulging or braid separation.

Inspection of the storage tank should also include a look at the dates of the relief valves. Pfalser notes that relief valves more than 15 years old should be replaced. The back-check valve at the bottom of the tank should also be in good working order, and marketers should make sure the seat has not separated.

Also at the bottom of the tank, the excess-flow valve, similar to a back-check valve, should be inspected and checked for seat separation. The internal valve is another valve marketers should inspect. Check for free stem movement and for leaks around the stem and packing.

“Internal valves have a built-in excess-flow feature. This needs to be checked to make sure it’s closing at the proper rate.”

The area where the storage tank makes contact with the saddle at the top of the concrete pier is another item that Pfalser said is not typically considered. If a storage tank has been in service for 25 years or so, the period before the start of heating season is an opportune time to break the plumbing loose, lift the storage up one end at a time, check the tank for pitting, and replace the padding if necessary. Marketers should inspect the piers themselves for cracking, settling, and general condition. Also check the storage tank gauging, whether it is a rotor gauge or float gauge, for proper operation.

“A lot of storages will be outfitted with temperature gauges,” Pfalser said. “If you use that for inventory purposes, throughout the year, you need to make sure it’s operating properly, check it against some outside source, make sure that you can still read it, and it’s not foggy and the glass isn’t broken.” The same goes with pressure gauges — make sure they are in good operating order and that they can be read.

Make sure the storage piping is painted with good heat-reflective paint, that hydrostatic relief valves are installed properly between points that trap liquid, and that all threaded joints are leak-free.

Signage is important. Make sure the proper signage is in place on the storage, per code, and that it’s legible and not faded.

Checking the bulk plant’s emergency shutdown system is the most important safety check of all. The propane industry needs to do a good job of maintaining these systems, Pfalser noted.

“We don’t need it until we need it. And the day we need it, it has to work, and it has to work flawlessly.”

Pfalser explained that actuating the emergency shutdown systems with a cable has been an industry standard for many years. But he believes cable-operated emergency shutdown systems provide a false sense of security. Propane marketers rarely check the cables for slack, rust, or to make sure the pulleys are turning.

“So you have a bobtail driver out there filling, something happens, he goes to pull on the cable, and nothing closes. At that point, it’s too late,” Pfalser said. “It’s really important to make sure the emergency shutdown system is working properly. If it is a cable system, make sure all the slack is taken out and that the pulleys are free from rust and turn freely. Open them up, go to the remote location, yank on the cable, and make sure all valves close. This is a really good time during the summer when things have settled down to consider moving from a cable-operated system to one that is pneumatically operated.”

A safety check of the entire bulk plant, the emergency shutdown system, and all aspects of a propane company’s operation can make a big difference toward keeping employees and customers safe.

“Safety is one of those things that is not needed until the day it’s needed,” Pfalser stressed. “And if safety hasn’t been maintained, then the day it’s needed becomes a really bad day.”     —Daryl Lubinsky