The propane industry in the United States is regulated in terms of safety and compliance but not in terms of pricing and services. Therefore, propane dealers adapt their offers to their customers’ needs. Comparing different offers from propane dealers is best done by requesting quotes from propane dealers in your area. It is in your interest to be as clear about your needs as possible to ensure dealers adapt their offers as much as possible.
Propane dealers all offer propane at different prices. Indeed, propane price depends on several factors, including the price of oil (since propane is a byproduct of oil), supply and demand (higher demand leaders to higher prices), weather conditions (colder climates tend to make prices rise), location (the further a home is from a main supply source, the higher the transportation costs reflected in the propane price).
However, the price of propane also depends on your home. Propane dealers offer different pricing options depending on how much propane you are likely to use: the higher your usage, the lower the price tends to be. Propane dealers calculate usage on the basis of how many propane appliances your home has, how well isolated your home is (has it been renovated recently?), how many occupants it has, what type of climate your region has, etc. It is advisable to have a rough idea of what the answers to these questions are as you request quotes so they are as accurate as possible.
Propane dealers often offer propane tanks. Most companies offer to install and maintain tanks for customers. The price of tank leases varies according to tank size ($25-$225/year). Leased tanks tend to be aboveground rather than underground. However, if you lease a tank from a propane company you are not allowed to fill it with propane from another company. Similarly, propane prices for leased propane tanks tend to be higher than those for owned tanks. Last, the smaller the tank, the higher the propane price is likely to be (it varies with the amount of propane ordered).
Tanks for sale
Propane dealers sometimes sell propane tanks (all large dealers do). This represents a significant investment since depending on whether your tank is aboveground or underground (which is more expensive) and how large it is (the larger the tank, the higher the price), prices vary between $450 and $3,500 for the tank and its installation. Owning a tank enables you to shop around for the best propane prices so propane dealers tend to offer better prices to tank owners. Similarly, the larger your propane order, the lower the price offered by propane dealers will be.
Pricing and payment options
Propane dealers offer different combination of pricing and payment options. Relatively few propane dealers offer fixed pricing options (where you buy the year’s propane at a fixed price) and this usually comes with a fee so you should check both if this is an option you require. All propane dealers allow you to purchase propane at the daily market price but some offer the possibility of buying propane in advance. And all propane dealers allow you to pay for propane in one installment but most offer budget plans that enable you to spread your propane bill payments over several months (between 9 and 12).
Propane dealers all encourage customers to choose automatic delivery, where the dealer estimates the user’s consumption and delivers propane when the tank is likely to fall below 30% capacity. This is usually free and ensures you never run out of propane. Because prices fluctuate it remains worthwhile to check the company’s daily propane price regularly to ensure the price you are charged follows the same trends.
Propane dealers all offer the possibility of purchasing propane at the daily market price by monitoring your own tank level and deciding when to order a delivery. While this enables customers – especially those with larger tanks – to order propane when prices are lower, you run the risk of running out of propane if you do not monitor your tank level diligently. Should you run out of propane and need a delivery urgently, delivery fees can amount to $200 and a leak test will be required since gas flow was interrupted.
An increasing number of propane dealers offer maintenance services and appliances. All the main propane dealers already do. Customers find this particularly convenient because not only are they sure of obtaining quality service but they end up with a single customer-care number, whether they need propane, repairs, an inspection or another appliance. This illustrates the importance of good customer care.
Check what propane dealers charge
While checking what propane dealers offer, you should also check what they charge. Most companies have a number of fees and charges for items such as safety training and compliance, fuel transportation, late payment, etc. It is important to find out what charges each dealer will apply to your situation and plan accordingly.