Federal Waivers Spur Propane Deliveries in Northeast as Cold Drives Demand

The U.S. Department of Transportation declared a regional energy emergency in the Northeast on Dec. 12 to address disruptions in heating fuel supplies caused by a November electrical outage at a Pennsylvania industrial complex. The emergency, which covers New York, New Jersey, Delaware, and Pennsylvania, waives federal hours-of-service regulations for trucks transporting heating fuels. The move aims to accelerate the delivery of propane to regions where demand is surging amid unseasonably cold weather.

New Jersey and Pennsylvania had already taken similar steps at the state level. New Jersey Governor Phil Murphy declared a state of emergency on Dec. 12, extending driving hours for propane truckers and ensuring uninterrupted fuel deliveries to 186,000 households that rely on propane for heating. Pennsylvania's Department of Transportation also waived trucking restrictions to ease the logistical burden.

The emergency declaration will remain in effect until the end of the emergency or midnight on Dec. 26 according to official sources. This timeline reflects the urgency of restoring normal operations at Energy Transfer LP's Marcus Hook terminal, where a Nov. 19 transformer failure caused a three-day shutdown of propane truck-loading operations. The company's force majeure declaration forced customers to operate on a 70% allocation, exacerbating wait times as the terminal now loads propane directly from a pipeline to trucks according to industry reports.

Origins of the Propane Disruption

The crisis began on Nov. 19 when an electrical incident at the Marcus Hook terminal disrupted propane loading operations for three days. Energy Transfer LP, the owner of the terminal, declared force majeure, placing customers on a limited allocation schedule. The National Propane Gas Association reported that customers are now receiving 70% of their usual loads, a situation that has caused long wait times as the terminal loads propane directly from its pipeline.

The National Propane Gas Association has been in talks with the Federal Motor Carrier Safety Administration for a regional waiver to ease the supply chain bottleneck. Shelby Bell, Executive Director of the Pennsylvania Propane Gas Association, emphasized that the issue is tied to the Marcus Hook disruption and not a general propane shortage. Energy Transfer is reportedly awaiting parts and equipment to restore full operations, though no definitive timeline has been announced.

Implications for Heating and Transportation

The emergency measures have already expanded the window for propane drivers to operate, allowing them to drive 14 hours instead of the usual 11. This federal waiver, combined with similar state-level actions, is expected to improve delivery speeds and alleviate concerns over heating shortages in the region. Governor Murphy stressed that the emergency declaration is critical to ensuring that households remain warm during the unusually cold December.

Despite these regulatory adjustments, the National Propane Gas Association warned that the limited capacity at Marcus Hook may still cause delays. The association noted that the terminal's operational challenges have ripple effects across the Mid-Atlantic and New England regions, where propane is a key heating fuel. The prolonged nature of the outage has also raised questions about the resilience of supply chains for essential commodities according to industry analysis.

Investor and Market Reactions

Energy Transfer, which owns the Marcus Hook terminal, has faced scrutiny from analysts and investors in recent months. Bank of America Securities reaffirmed its Hold rating on the company's shares on Dec. 14, citing ongoing challenges in the energy infrastructure sector. Meanwhile, Glenview Trust Co. has increased its stake in Energy Transfer, purchasing 77,665 shares in the second quarter of 2025. The company also raised its quarterly dividend to $0.3325, yielding approximately 8.1%.

Kelcy Warren, a director at Energy Transfer, recently added to his holdings by purchasing 1,000,000 shares at $16.95 each. The increased insider activity suggests a level of confidence in the company's long-term prospects despite the current crisis. Still, the situation at Marcus Hook has added volatility to Energy Transfer's stock price, with shares trading at $16.45 as of Dec. 14 according to market data.

The broader market for energy infrastructure stocks remains mixed, with some investors betting on long-term resilience while others remain cautious about short-term disruptions. The Gabelli Focused Growth and Income Fund, which holds Energy Transfer as a significant position, reported a 3.6% gain in the third quarter of 2025. However, the fund's performance was negatively impacted by a 3.5% loss from Energy Transfer, reflecting the stock's sensitivity to operational challenges according to fund commentary.