Market Trends of United States Propane Industry
This section covers the major market trends shaping the US Propane Market according to our research experts:
The Residential Segment to Dominate the Market
In the residential sector, propane is used for air conditioning, heating water, cooking, refrigerating foods, drying clothes, lighting, and fueling fireplaces.
- Propane is used mostly in homes in rural areas that do not have natural gas service, as well as in mobile homes. Millions of homes use propane to meet some of their energy requirements. In the United States, about five million households use propane as their main heating source, and around one-fifth of mobile homes use propane for heating.
- The average residential propane tank holds between 500 and 1,000 gallons of liquid fuel. Millions of backyard cooks use propane-powered gas grills for cooking. Moreover, recreational vehicles usually have propane-fueled appliances, giving them a portable source of energy for cooking, hot water, and refrigeration.
- Over the past few years, there has been a consistent rise in the number of residentially occupied housing units that heat their homes using utility gas. The number of homes in the United States that use gas as their main source of heat is expected to reach 59,246,257 in 2021. This is equivalent to 46.7% of all homes.
- The increasing new residential construction, combined with continuing fuel oil conversions, is expected to offset residential space heating losses to electricity and natural gas, which is leading to a slow growth in the number of residential space heating customers through 2025.
- But because propane use is becoming more efficient, the future demand for propane may stay the same in terms of volume.
- The above-mentioned factors are anticipated to enable the residential segment to dominate the market.
Understand The Key Trends Shaping This Market
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Growing Commercial Sector
- Propane is utilized in the same manner as natural gas is in the business sector. Propane is used for a wide variety of purposes in a large number of commercial establishments, including but not limited to restaurants, hotels, dry cleaners, automobile mechanics, auto body repair shops, wineries, offices, and warehouses.
- Fuel for energy-efficient space heating, cooking, fireplaces, water heating, clothes drying, and various other needs can be obtained from propane. This is especially helpful in big buildings like hospitals, resorts, and warehouses that use propane gas as a fuel for a lot of different things, like heating, cooling, soldering, and brazing.
- Propane is a common energy source in restaurants around the United States, where it is used for cooking and heating. Propane is a popular choice for food service operations that take place in outdoor settings or that utilize mobile kitchens since it is a versatile fuel that delivers a high heat output and is simple to transport. According to information from the US Census Bureau, food retail sales in the US reached USD 7.441 trillion in 2021, which was a 19% increase from the previous year.
- Propane is also the best option for backup generators that are used in commercial facilities because it can be stored for an infinite amount of time, does not degrade with time like gasoline does, and does not become more viscous in cold temperatures like diesel does.
- Propane provides commercial buildings and facilities with all of the benefits that gas provides at a price that is highly competitive when compared to the cost of other alternative forms of energy. Because it is less expensive and better for the environment, selecting it for business applications is likely to yield the best results.
- Because of the things we've talked about, it's expected that the commercial sector will be able to take the lead in the market.
