How is Renewable Propane Used Today?

Written on: October 27, 2023

It’s already powering the transportation and industrial sectors.

renewable propane united states For over 100 years, Americans have used propane in countless residential and commercial functions. Once Walter O. Snelling’s pioneering research made it possible to trap lighter hydrocarbons from oil and store them as liquid in a steel container, propane became a popular way to power blowtorches, stoves, and other equipment. In 1929, the first bobtail trucks hit U.S. roadways. The 1932 Olympic Village in Los Angeles used propane to fuel all its cooking appliances and water-heating equipment. By 1945, propane sales had reached 1 billion gallons. *

In short, once Americans saw the potential of propane, they began using it in multiple aspects of their lives.

Today, we’re seeing another research revolution in propane. The emergence of renewable propane gas (rPG) and other innovative, eco-friendly blending products such as renewable dimethyl ether (rDME) promises conventional propane’s benefits with a carbon impact rapidly approaching zero. While renewable propane is still emerging, it’s already used throughout this country.

Refinery Power

Just as conventional propane first emerged as a coproduct of oil refining, renewable propane, at this point, is largely a coproduct of biodiesel. As such, biorefineries produce a lot of rPG. Today, one of the main uses of this co-produced rPG is in refinery systems. Biorefineries use the renewable propane coproduct they generate to provide the energy for the biodiesel production process rather than bringing in some other energy source, such as natural gas.

While this is a reasonable use of rPG, a study conducted by the National Renewable Energy Laboratory for the Propane Education & Research Council found that recovering and selling rPG can offer significant revenue opportunities for biorefineries — with capital recovery payback periods in as short as two months.

Propane Autogas

The transportation sector represents over one-quarter of the greenhouse gas emissions in this country. Propane autogas provides a fantastic alternative fuel source for our light-, medium- and heavy-duty vehicles. According to the U.S. Department of Energy, roughly 60,000 autogas vehicles are already on the road, and school districts across the country are taking advantage of autogas buses’ clean performance and cost-saving benefits.

Conventional propane emits significantly fewer greenhouse gas emissions — including carbon dioxide, particulate matter, nitrogen oxide and sulfur oxide — than gasoline or diesel, with a carbon intensity (CI) score of only about one-fifth. Switching to autogas is generally much more affordable than switching to an electric vehicle fleet. Financial incentives through the Renewable Fuel Standard Program give producers of renewable propane autogas a chance to further improve their revenue streams.

Autogas made from rPG is expanding across this country. In 2020, U-Haul brought one million gallons of rPG to autogas stations in Southern California, and this year, a New England propane retailer brought the fuel to pumps in Connecticut.

Renewable Propane’s Expanding Usage

We’re seeing retailers serving residential and commercial customers bring rPG to market in Oregon, Washington, New York, Vermont and other states. Renewable propane is currently used in 16 states, and that number will grow as time goes on.

There are fantastic incentives for embracing this green fuel, which can be used in existing propane-fired equipment without modifications. For example, the Inflation Reduction Act includes tax credits for fuel used or sold after 2024 with a CI rating of less than 47.4 gCO2eq/MJ. Renewable propane generally has a score of around 20.

Homeowners and business owners want low-emissions energy that does not require the exorbitant costs associated with electrification. 2027 U.S. production capacity for rPG and other innovative blends could reach 277 million gallons. Fuel producers, wholesalers and retailers — and the customers they serve — have incredible opportunities in the future.

If you’re interested in joining the Renewable Propane Alliance or would like more information on our work, reach out to us here.

* Source: Propane Education & Research Center, “Sources and Processing of Propane”