Do you want to know why propane is so high?
Propane is one of the environmentally friendly gases. However, they are not widely used because they are not cheap to use. So let’s find out right away why propane is so high in the article below.
What is propane?
Propane is a hydrocarbon and is sometimes referred to as liquefied petroleum gas, LP gas, or LPG you can see more in the Propane FAQ section.
Natural gas, when released into the environment is a greenhouse gas while propane is not classified as such. Propane is not toxic or damaging and will not harm the environment if it is released into the atmosphere. That’s why it’s not labeled as a greenhouse gas.
So propane will not contribute to pollution. While natural gas is there. Propane is a green fuel before burning. And still environmentally friendly even when it is used.
The reasons why is propane so high
There are 4 main reasons:
The first reason is because Gas propane companies can freely decide the price
Unlike City Gas, Propane Gas is calculated using a method called “free” rather than “public”.
There is no official price standard for free rates, so gas companies are free to set prices. In most cases, the gas company abused it to charge an unreasonably high fee.
Some gas companies raise prices from time to time, even setting low prices when they sign contracts. Price increases are usually communicated in writing rather than over the phone, so it’s not uncommon for you to get a price increase without your knowledge.
That’s the first reason why is propane so high.
The second reason is that labor costs tend to be high
For Gas Propane, gas cylinders are installed in each household to supply gas. Labor costs are high because you need to replenish the gas and check the tanks on a regular basis. These labor costs are added to the monthly gas bill, hence the high price of Gas Propane.
On the other hand, city gas supplies gas underground through pipes, so labor costs are lower than propane gas.
The third reason is due to the high cost of equipment construction
Gas Propane equipment installation includes gas meter installation, cylinder tank protection, and outdoor gas pipeline work. In general, it costs about 100,000 yen (Japanese currency), but Gas Propan company can take over at the time of the contract and then add to the monthly gas fee.
If you have been using Gas Propan for many years on the same contract, you may have to pay more than the original cost. With such high equipment construction costs, it is understandable why is propane so high.
There is very little competition in price
For more than 40 years, the composition of the Gas Propane industry has continued, such as “providing gas at high prices without competing on price” and “without competing with customers.”
In April 1997, the “Liquid Petroleum Law” was amended, and gas trading companies were instructed to make their fees and service content publicly available to users in an easy-to-understand manner. In many cases, prices remain high.
City gas, on the other hand, is a utility fee and can continue to supply gas as long as the pipes are not broken. Compared to Gas Propane does not require labor, so the cost is significantly reduced.
The above are reasons to help you understand . Please share this useful information with more people!