Trends, Reports & Analyses
GAO Report Eyes Propane Group
After a federal report raised questions about the way a propane industry group was spending some of its money, the group’s controversial ad campaign is ending.
A GAO report raises issues about some of the spending practices of a propane industry group. (Photo By: Michael W. Kahn)
The Propane Education & Research Council, along with its oil heat industry counterpart, was the subject of a U.S. Government Accountability Office report. PERC’s operations are funded through a federally authorized check-off program, in which each gallon of propane sold is assessed $0.005.
The report states that in accordance with the Propane Act, PERC notified Congress and the U.S. Department of Energy that in August 2009, the five-year average rolling price index of consumer grade propane exceeded a certain price threshold. That requires the council to restrict its activities, which PERC said it did.
According to the report, PERC later approved continuation of a $5.9 million grant for “residential advertising” intended to “educate construction professionals about the benefits of propane throughout the home.” PERC said it complied with restrictions by cutting all educational components of the grant, with the remaining work constituting training. But the GAO said that PERC records show “it did not reduce the amount of the grant and, instead, approved a no-cost change order to the grant in October 2009, a month after the restriction was triggered.”
GAO suggested that Congress consider subjecting PERC’s activities “to review, interpretation, and approval by an independent, designated entity.” Noting that the U.S. Department of Energy does not believe it has an oversight role, the report went on to suggest that lawmakers might authorize DOE “to oversee and enforce, among other provisions, the prohibitions against use of assessment funds for certain lobbying activities.”
Meanwhile, PERC announced that its “Energy Guys” campaign ceased on Dec. 31. The ads featured two actors—one portraying propane, the other electricity—and were critical of electricity. Although the national campaign has ended, propane marketers are allowed to use the images for the remainder of 2011.