Butane, propane… Why these energies have increased much less than natural gas and fuel oil

Butane, propane… Why these energies have increased much less than natural gas and fuel oil

A bottle of butane and a ton of propane saw their prices increase by 9.9% and 16.7% respectively in one year, compared to 44.4% for natural gas… which, however, remains more affordable .

Whether for heating, cooking, producing hot water or moving, eleven million French households located mostly in the 27,000 municipalities that are not currently connected to the natural gas network depend on liquefied petroleum gas (LPG) for their needs. energetic. Distributed since the 1930s in France, LPG (not to be confused with LNG) includes butane gas (in bottles), propane gas (in tanks), and LPG fuel used by 220,000 motorists.

Post-Covid economic recovery, war in Ukraine… With the exception of LPG fuel, which benefited from the 18 cent discount on fuel, the prices of liquefied petroleum gas have not been spared from the events of recent months. In detail, the price of a 13 kg butane gas bottle (without a tank) went from 34.74 euros to 38.16 euros on average between June 2021 and June 2022, 9.88% more in one year, according to INSEE.

For its part, the ton of propane (excluding the rental of the cylinder) saw its average price rise by 16.68% in the period (2,111.12 euros in June 2022 compared to 1,809.26 euros in June 2021), according to data from the Ministry for Ecological Transition.

Gases that do not come from Russia

These increases are more substantial than the increase in electricity prices (+7.6% in June in one year, thanks to the tariff shield) but significantly lower than the increase in natural gas prices (+44.4%). It must be said that “city gas” has nothing to do with propane and butane: “They are not the same gases. They are distributed by different suppliers,” explains Butagaz, one of the four large LPG suppliers.

Butane and propane are gases recovered either through oil refining or during the extraction of methane from natural gas fields. French producers depend 30% on refinery production and 70% on gas operations located in Algeria and Norway. “Since they are not imported from Russia and Belarus, their market has not suffered the same very bullish conditions as that of natural gas, although it may have suffered the ups and downs linked to the very strong tensions in the energy markets”, highlights Audrey Galland, CEO of France Gaz Liquides.

“Beyond the cost of liquefied gases, (…) the cost of raw materials (including metal) and transport have also increased, which has increased the price of cylinders and gas in tanks,” he also points out. Butagaz. Even so, the increase in the prices of propane and butane gas seems to be much more moderate than that of heating oil (+90.31% in June in one year). In fact, “fuel oil is directly indexed to the price of oil: therefore, it has suffered the same price pressures as fuels”, continues Audrey Galland.

Propane more expensive than natural gas

Despite a more contained price increase, heating with propane is still much more expensive than heating with natural gas. Especially since the latter has benefited from the tariff shield, through a blockade of regulated tariffs (TRV), thus limiting the rise in consumer bills. For a consumption of 14,000 kWh, Engie now estimates the average annual bill of a household that has contracted a TRV at just under 1,500 euros, compared to just over 1,100 euros a year ago.

As for propane, the average consumption of a home is estimated at 19,043 kWh per year, or 1,370 kg of propane. At June 2022 prices, this corresponds to an average cost of €2,892 per year (excluding rent and deposit maintenance), compared to €2,479 in June 2021. However, it should be remembered that this is only an average and that it is not very difficult to give an exact price given the number of offers and to the extent that the budget varies according to the type of habitat, the level of isolation, the configuration of the accommodation, etc.

Still, LPG appears to be becoming much more attractive than fuel oil, whose price has soared in recent months. Knowing that a 100m² house consumes an average of 2,000 liters of fuel oil per year, the average bill in June stood at 3,341 euros, almost double that of a year ago (1,756 euros).

The LPG winners from the elimination of the tariff shield?

LPG providers expect to do well in the coming months. Because if “the state has provided substantial support for natural gas and electricity for consumers, this may no longer be the case depending on the outcome of the budget debates,” notes Audrey Galland.

In effect, the tariff shield today artificially blocks the price of natural gas paid by the consumer. But “the price comparison, which better reflects the reality of the markets and, therefore, the price perspectives for 2023, shows today that propane benefits from a historical stability and competitive advantage”, also indicates the general director of France Liquid Gases.

At this stage, the executive plans to maintain the tariff shield until 2023. Without this protection, city gas would have been twice as expensive at the start of the school year as it was on October 1, 2021, according to CRE. But the government spokesman, Olivier Véran, warned: if the shield is not removed “at once”, it cannot “freeze prices indefinitely”.

LPG to overcome any winter difficulty

Beyond the price issue, industry players see LPG as an ideal alternative to natural gas at a time when Europe fears shortages due to reduced Russian gas deliveries: “Due to secure supply and logistics and distribution capacity throughout France (including outside mainland France or in the most remote areas), propane and butane will be available next winter, as will LPG fuel for vehicles, at a very competitive price at the pump (0.85€/L on average)”, continues Audrey Galland.

In a text published in The galery, the leaders of Antargaz, Butagaz and Primagaz already assured at the beginning of July that the millions of LPG users reduced – probably without realizing it – the tensions weighing on our energy system. Even if it is only with “the 10 million gas cylinders used” by the French and that “represent the equivalent of 20 nuclear reactors at their maximum power. (…) It is nothing,” recalls Audrey Galland.

In addition, “energetically responsible and united, the liquefied gas sector, the 3rd energy of the French, is capable of doubling its support for the electricity and natural gas network thanks to its butane, propane and LPG cylinders and tanks,” say the experts. authors. of the forum

Finally, LPG providers want to establish themselves as the first alternative to heating oil, which is now prohibited in new homes. Especially since propane emits 50% less CO2 emissions, they say.

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