Choosing a propane company

Choosing a propane company

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Your choice of propane company should be guided by your specific needs and which company best meets them. The only way of ensuring you get the best deal is to compare what different propane companies offer by requesting quotes and selecting the most appropriate offer. The following elements should help you establish what details you should include in your request for quotes and subsequent negotiations.

Propane safety

As you choose your propane company, your priority should be safety. Propane is not a dangerous gas and very few propane-related accidents happen. Propane is not toxic and propane tanks do not explode. But there is a risk of carbon monoxide intoxication if appliances are not functioning properly. It is paramount to have a propane company with a 24/7/365 helpline that can reassure you if you suspect a leak but there is not real threat and that can respond quickly if the threat is confirmed.

Customer care responsiveness

Whatever the service, responsive customer care is essential. This is all the more true of propane companies since energy is crucial to your well-being, especially if you use it for space heating, water heating, refrigeration, etc., as do millions of homes throughout the United States. Therefore, it is important to ensure the number you call with questions on propane price, maintenance issues or to request a delivery is available and that the company’s customer care service is staffed with competent employees. The easiest way of checking whether propane companies have responsive customer care systems is to call your local office and see how the person on the other end of the line responds.

Propane prices

At December 2012’s average national propane price ($2.413 per gallon), filling a typical 500-gallon propane tank (to 80% capacity, which is the norm), represents a sum of $965. A 20c difference per gallon amounts to $80, which is considerable, and customers are sometimes offered prices that can vary up to $2/gallon. Therefore, propane prices are likely to be an important factor in choosing your propane company.

Yet propane prices are not regulated and vary significantly from company to company and from customer to customer. Basically, although it is in their interest to remain competitive, propane companies are free to set the price they choose.

Your best way of ensuring you are offered a respectable propane price is to know what factors affect these prices:

  • Propane is a byproduct of oil so propane prices rise as the price of oil increases. The price of petrol also affects propane price in the sense that if you live far from a major propane supply source it will cost propane companies more to deliver it to you and this cost will be reflected into the propane price.
  • Your location affects propane prices given transportation costs but also climate: if you live in a region that is cold and humid, you will probably pay a higher propane price than if you live in a warm and dry region.
  • Usage plays a large part in the prices propane companies offer. The more propane a home uses, the lower the propane price they are quoted at each delivery. Usage rises with the number of occupants in a home, how well isolated it is and how many appliances run on propane.
  • Supply and demand also affects propane prices. The more people need propane, the higher the propane prices will be. This is why propane is more expensive in winter than in summer.

Propane tank size

Your home may come with a propane tank. If this is not the case, you will have to choose whether to buy or rent a propane tank. Most propane companies now lease and sell propane tanks. Either way, it is useful to know that the national yearly US household propane usage is 464 gallons.

Renting a propane tank from a propane company is the choice of most propane users. Propane companies will advise you on what size tank your home requires. It will probably be installed and maintained free of charge but you will be required to pay a yearly rent fee of between $25 and $250 depending on the size of the tank you have chosen. Most rented tanks are aboveground. The only disadvantage of leasing a propane tank is that companies tend to charge a higher propane price per gallon.

Purchasing a propane tank from a propane company enables propane users to choose the propane company that offers them the best price at each delivery. However, propane tanks cost a far bit of money: depending on size, aboveground tanks cost between $450 and $2,500 to buy and install and underground tanks (less visible) cost between $1,800 and $3,500. Propane companies tend to offer better propane prices to tank owners.

Whatever the solution you choose, it is useful to know that propane prices decrease as the amount of propane ordered increases. Therefore, it can be more expensive in the short term, but cheaper in the long run, to have a larger propane tank. Bigger propane tanks can also enable propane users to plan propane deliveries and buy propane when it is cheapest, to avoid the winter price increases. It is up to you to decide whether the extra investment is worthwhile.

Propane delivery options

Propane companies tend to offer two types of delivery options. Most encourage customers to select automatic delivery. This is convenient both for the client and the company because delivery times are calculated by the propane company on the basis of usage and weather patterns and the only thing necessary is access to the propane tank so clients do not have to be home.

Companies deliver when on the basis of their calculations your tank gauge is likely to drop beneath 30%. The price of propane for each delivery is that of the company’s daily propane on the day the delivery is organized. To avoid billing surprises you might want to check the propane price regularly to ensure you are being billed reasonably.

Customers can always order propane themselves when they need it by calling their propane company when their tank gauge falls below 30%. This option allows customers to plan their propane deliveries but can be inconvenient since they need to be present at the time of delivery.

The advantage of ordering your own propane is that if you have a larger tank you can order more propane than you actually need when the price is low. The disadvantage is that if you forget to order propane and run out, you will need a leak test (up to $100) and will probably be charged an emergency delivery fee if you order after hours (around $200).

Propane company services

Choosing a propane company might be influenced by the services other than propane that companies offer. Indeed, propane companies increasingly offer maintenance and repair services. This is convenient if you prefer having a single number to call when you have a question about an appliance or your tank, for example if you suspect it is not functioning optimally. Such services are usually billed at a local hourly labor rate so it is useful to check what the company charges.

You can ensure you spend as little as possible on propane by maximizing your home’s energy efficiency. Large propane companies offer – sometimes free – advice on how to improve the efficiency of energy usage in your home. This can be an interesting service to have available especially if you are building a home and installing propane appliances: you can make sure that, from the start, your home configuration is as energy-efficient and environmentally-friendly as possible.

Propane company safety standards

Propane-related accidents rarely happen: the National Fire Protection Association estimates that the individual risk associated with propane is one in 37 million.

Nevertheless, propane is often (wrongly) perceived as a dangerous gas and two kinds of accidents most worry potential propane users:

  • Propane tanks exploding and explosions linked to propane truck (bobtails) accidents. This is incredibly rare and most accidents of this type are reported (the probability is almost inexistent).
  • Carbon monoxide poisoning: this happens when appliances are not producing an ideal burn and carbon monoxide is released. It can cause dizziness, nausea, but extreme cases can lead to brain damage and even death.

There is no golden rule on propane company safety record. All companies have a good safety record given how rare propane accidents are. Furthermore, compliance with federal, state and local regulations is enforced by federal, state and local authorities – which leaves little room for error.

When accidents do happen, and these mostly relate to carbon monoxide poisoning through inhalation, they are due to insufficient employee training or poor consumer information. Therefore, safety remains a priority when selecting a propane company: ensure that their employees are trained regularly and that the company spends time informing you of propane-safety procedures and reflexes. It is precisely because such guidelines are followed in detail that the accident risk is so low.

Propane safety employee training and consumer information

As you request quotes from different propane companies to select the one that best suits your needs, you should ask what programs they have set up to ensure employees are trained and consumers are informed adequately. The most successful of these have been set up by the Propane Education and Research Council (PERC) and the National Propane Gas Association (NPGA).

Propane Education and Research Council programs

The Propane Education and Research Council’s safety training and information programs are funded by the industry and aim to ensure that the propane industry workforce is trained to comply with federal, state and local regulations, as well as with the highest independent industry standards. Similarly, their consumer safety outreach content seeks to inform propane users of risks and procedures associated with propane systems.

Propane company participation in PERC and NPGA Certified Employee Training Program

Workforce training starts with completing the Certified Employee Training Program (CETP). Set up by the NPGA, the CETP is increasingly accessible to propane industry members as a response to the US Department of Transportation and National Fire Protection Association requirements in terms of employee training. CETP certification implies that propane industry employees acquire crucial safety skills that are tested through an exam. It is recommended that you check whether propane companies take part if in the CETP for their employees.

Propane company participation in other PERC safety programs

The PERC also organizes a number of other training programs/modules for propane industry employees. These concern cathodic protection (protecting propane tanks against corrosion), static electricity (to manage the risk associated with static electricity generated at propane facilities), dispensing propane safely (into cylinders and tanks), bobtail rollover prevention (for propane truck drivers during deliveries) and mobile crane safety training (used for propane tank delivery). Additionally, the PERC has a propane emergencies training program (e.g., in case of an accidental overfill when pumping propane into a tank) and a gas appliance systems check (GAS Check) voluntary inspection program (to ensure your entire system works according to certain standards).

Propane Education and Research Council consumer outreach

Propane user information is also crucial in preventing accidents from happening. This is relatively simple and only requires propane users to be properly informed of what to do if they suspect a leak, what propane maintenance entails and who to call if they have a question.

Therefore, comparing propane companies should include enquiring into what programs they have to inform users and families of the risks and procedures regarding propane safety. Again, the PERC offers a certain number of programs and documents dedicated to consumer outreach to increase knowledge of propane risks and safety measures. Propane companies often convert this information into booklets they give out to new customers.

Company participation in the National Propane Gas Association and their state and local affiliates

The National Propane Gas Association is the propane industry’s advocacy tool. However, the NPGA and its 38 affiliated state or regional associations also promote propane safety in their interactions with their 3,200 member propane companies.