Choosing a propane tank can seem like a complicated task and it is recommended to find out what different propane suppliers and tank companies offer before making a final decision. While a 500-gallon tank ($800-2,500 aboveground, $1,800-3,000 underground) is sufficient for most typical four-bedroom houses propane consumption varies greatly according to the number of occupants, how cold it is, how large the house is, etc. Here is some general advice on what to look out for when requesting quotes for propane tanks.
Leasing a propane tank
This is the most popular solution (70% of US homes where propane is the primary source of energy). Renting a tank costs between $75 and $250 per year depending on tank size and whether the tank is above- or underground. Most propane companies allow you to rent a propane tank from them and will include installation and maintenance in the price they quote. Propane companies will require a credit check and a minimum propane usage (at least three appliances should run on propane) lease you a propane tank and you will need to commit to buy propane from that company for around three years in your propane supply agreement.
If you decide to rent a tank, this will be included in the overall quote with propane price, delivery options, services and maintenance. The propane company will advise you on the tank size you need for the amount of propane you will probably use but you should also enquire as to what specific services are included to have as detailed a quote as possible. Renting a propane tank from a propane dealer also prevents you from getting propane delivered from another company, even if the latter’s price is lower. It is therefore in your interest to have as many elements of your propane supply agreement as possible in your quotes (tank lease price, installation costs, service costs, propane price, fees and charges, etc.).
Purchasing a propane tank
Around 30% of American households that use mostly propane as a source of energy choose to purchase a propane tank. This can be the most cost-effective solution in the long run given that owning your propane tank allows you to select the propane company with the best propane price per gallon for each delivery.
Propane tank purchase costs range from $450 to $1,000 for 100-250-gallon capacity and $800 to $2,500 for 500-gallon capacity if the tank is aboveground; if underground, tanks cost between $1,800 and $3,000 for 500-gallon tanks and between $2,000 and $3,500 for 1,000-gallon tanks. Propane tank permits (a legal requirement) will cost between $25 and $30 and extra copper piping between $1 and $2 per foot.
However, buying a propane tank implies having it installed and having it serviced. Therefore, when getting quotes from a propane dealer or a tank sales company, you should enquire as to how much they charge for installation and whether they offer maintenance. This is especially important for safety reasons: propane is a safe but highly flammable gas and it is useful to have a number to call if you suspect a leak, for example.