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PROPANE: THE HIDDEN HISTORY
PART IIl
REFINERIES MAKE NEW MONEY FROM A NEW RULE
Last week we explained how the ASTM Standard for propane has changed since it was introduced in 1961, and why 1975 was a watershed year for the refineries. This week, we discuss what these changes mean in action. There is only one chemical that is propane: C3H8, found in nature bound up with natural gas. In 1932, the Gas Processors' Association published a standard for propane, GPA 2140, that has been the standard ever since. This standard requires that the propane drawn out of the "raw make," the gas that comes from the ground, be tested, and that the resulting gas extract be at least 90% chemical propane and no more than 5% propylene and no more than 5% other gases, including ethane and butane. It is tested to make sure that its quality is consistent. Gas processors have strictly adhered to this standard, because the only way they have to transport the gas is over "common carrier" pipelines, that are required by Federal Law that every customer of the pipeline have equal access to the pipeline. Because of the length of time it takes to pump propane from Texas to where it used in the Midwest and Eastern Seaboard, customers would have to wait days and even weeks for the gas they bought in Texas, where the propane is stored, to arrive at the terminals where they picked it up. In the middle of winter, such a system would never work. To solve the problem, the gas transporters made the propane "fungible:" all the propane would be identical, so that the gas a customer picked up in Pennsylvania was identical to the gas stored in Texas. To make all the gas identical, the transporters required that all the propane be HD5 propane, and they tested it to make sure that all the propane that went into their pipeline began as HD5 and remained HD5 so long as it was in their pipelines. Homeowners benefited from this business requirement with access to pure HD5 propane.
By contrast, since 1975, oil refineries were able to take advantage of the newly included definition of "special duty" (HD5) in the of propane in the ASTM (American Society for Testing and Materials) standard, ASTM Standard D1835, we discussed in last week's newsletter, in order to market oil refining "odds and ends," known by chemical engineers as "slop." The refineres could market slop as "commercial grade" propane because it was a hydrocarbon mixture that held a flame. Such a hydrocarbon mixture need not contain a single molecule of chemical propane, and could contain any dangerous substance that came out the top of a refinery column. This slop used to be flared off, simply to pollute the air. But when the sulfur was taken out, beginning in 1971 to comply with the Clean Air Act, the refineries saw how they could profit both from the sulfur, sold as fertilizer, and from this waste product sold to their allies, the publicly-traded major propane marketers, who would drastically mark it up and sell it to house holders as "commercial grade" propane. Thus slop has since been marketed throughout the Midwest and East, wherever these marketers can reach, as propane. Thus the refineries turned a new rule into a lasting money-maker, to the lasting harm of the American public.
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