VOLUME 11 NEWSLETTER MAY 31, 2007

Here we are, starting our 7th year as a Co-Op with 850 plus members of which 500 plus own their own tank. As you well know energy prices (Gasoline, Natural Gas, Electricity, Propane, etc.) are escalating at an alarming rate. Even though Propane is a waste product of the refining process, it is increasing in value right along with the refined products. We have heard pricing all over the map from various suppliers, some Moderate and some High to Very High.

We have sent Bid Requests to 19 Companies and are currently waiting their response. As soon as we get the Bids back we will meet to select our supplier for the 2007-2008 heating season.

Over the past winter I have been researching the various quality grades of Propane and have found out there are three (3) different grades of Propane one being a product called HD-5 which is the best and highest grade with a 90% minimum Propane content and a 5% maximum Propylene content with the other 5% allowed as Ethane or Butane or a mixture of any of 114 various LPGs (Liquid Petroleum Gases). The Propane and Propylene contents are set by Federal Regulations. The next grade of Propane is known as HD-10 which is not Federally Regulated and contains less Propane and more Ethane, Butane and Propylene. The third grade of Propane is known as Commercial Grade Propane and again not Federally Regulated and can contain as little as 51% Propane with a mixture of the other 113 LPGs. The lesser Propane content products burn hotter but, they also burn faster and as such are used by the Petrochemical (Plastics) industry on the West Coast and transported to the Mid West via the Texas Western Pipeline. We get our Propane from Marysville, MI which is on the Texas Western Pipeline and also from Sarnia, Ontario, Canada. At present the only Terminal available for us to get HD-5 Guaranteed Propane is in Todd Hunter, Ohio and would have to be transported here via Truck Transports which again would increase the price of Propane. We are being told by the Propane suppliers in this area that they are delivering an HD-5 Propane product and backing it up with Paperwork. It is just hard to believe that so much care would be given at the refineries to assure a quality Propane product while their are no Regulations requiring them to do so as well as knowing their larger consumer the Petrochemical Industry does not require it. It is also NOT transported along the Texas Eastern Pipeline which transports nothing other than HD-5 Propane. Todd Hunter, Ohio is the closest Texas Eastern Pipeline Terminal for Michigan. We will continue to pursue getting Propane delivered via the Texas Eastern Pipeline for our Co-Op members.

Now, lets talk about Tank ownership because if and when we are able to provide HD-5 Propane it will start out being for the members whom own their Tanks due only to the fact that a new Company starting out would not have Lease Tanks available and cannot fill another Companies Tank. We do have a New start up Propane Company interested and they are pursuing HD-5 Propane as their product delivered from Todd Hunter, Ohio.

Your Membership Dues for $10.00 are due payable through out the month of June. Checks should be made out to Harrison Area Cooperative Association and mailed to PO Box 846, Harrison, MI 48625 Attention Mary Kay Chisholm. Please note your Membership Number on the check.

We do have a Supplier for Tanks and he is Jay Bovee, his telephone number is 989-620-1831. Jay has both 500 and 1000 gallon Tanks available. The 500 gallon Tank is $650 which includes the regulators, hook up and leak check. The 1000 gallon Tank is $1000 and also includes the Regulators, hook up and leak check.

We encourage our members to buy their tank so that when an opportunity such as the HD-5 Propane availability arises we can, as a co-op move on it. We are convinced by all we read and found out about the various grades of Propane that the better grade Propane would result in an overall savings due to the increased efficiency of the product.

We are also convinced the savings would pay for the purchase of the Tank in much less time. We will continue to strive for a better more efficient Propane product for both our Owned Tank and Leased Tank members.

As soon as we get the Bids back for the 2007-2008 heating season we will follow up with a Fall Newsletter to let you know who the supplier is and or suppliers are.

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