Selecting the perfect propane delivery plan for your household isn’t about pinpointing the lowest cost per gallon. It’s about connecting your fuel usage requirements to a service plan that suits the demands of your household. If that connection isn’t made, you’re likely spending too much money for service you don’t need or relying on a plan that demands more from you than you are willing to give.
Start with how your home actually burns propane
It is recommended that you determine your consumption first before you go out and compare suppliers or contracts. A 2000-square-foot house will naturally consume more than a smaller one, but even two identical houses can have very different usages depending on if, say, one of them is only using propane for cooking and the backup generator. Propane use is generally estimated by appliance count and total BTU load, but the weather also plays an enormous role in how much you’ll use in a given year. Hence, suppliers often estimate your use in heating degree days, and the more of those they have to account for, the more fuel you’ll use.
Tank size also plays a huge part in how much you consume. A 100-gallon tank is plenty for a generator or a cooktop, but a house heated with propane will likely need a 250, 500, or 1000-gallon tank if you don’t want a truck refilling your tank every few days during a cold snap. Bigger tanks buy you more days of on-hand supply, which, as we’ll see next, becomes something you might want to think about when deciding how the propane gets to you.
Automatic delivery vs. will-call: convenience or control
This is the central fork in the decision tree for any propane customer. Do you want your supplier to “just handle it”, monitoring your usage and scheduling deliveries without your direct involvement? Or would you rather save some cash and keep that job in-house (literally)?
Automatic delivery is the more popular (and expensive) of the two choices. Your supplier tracks your usage – often through tank monitoring systems or historical degree-day estimates – and schedules refills before you run low. For households using propane for residential heating, this matters more than it sounds. Automatic delivery removes the risk of waking up to a cold house mid-winter, which is the scenario every other consideration in this article is ultimately trying to prevent.
Will-call delivery has its own attractions. It’s often cheaper since you’re doing part of the delivery person’s job for them. And some people just prefer the control. They like knowing exactly how much fuel they used, when that last charge was or was not justified, and how much they’ll likely need to spend this time. There’s extra few bucks in their wallet, and they appreciate that.
It’s not for the faint of heart mid-winter though. Miss the window during a cold snap or a supplier’s busy season, and you could be waiting days for a truck.
Pricing structures change your cash flow, not just your total cost
After you’ve chosen a delivery model, deciding on a pricing plan is the next step. There are three main types to consider including fixed-price contracts, market-rate pricing, and budget billing.
A fixed-price agreement locks in a specific per-gallon rate for the entire heating season. This protects you from unexpected price increases, but you won’t benefit if prices go down. With market-rate pricing, your cost fluctuates with the current price of propane. This means you could end up paying more in a harsh winter but less during a warmer one. Budget billing approximates your annual expense and divides it into equal monthly payments. This can help stabilize your bills and give you better control over your household budget.
None of these change how much propane you use. They change when and how predictably you pay for it.
Read the contract before you read the price
The price-per-gallon that you see advertised in big, bold type isn’t always the best indicator of what you’ll pay at the end of the day. Make sure to ask about tank rental costs if you don’t “own” your tank since that’s a fee you’ll pay no matter the amount of fuel. Also, find out if there are minimum delivery gallon amounts – often, if you need less than a certain amount, they just won’t send a truck. Also look for emergency or after-hours delivery fees and scope out the fine print on penalties related to changing suppliers – some lock you in more tightly than seems fair.
Reliability beats price when the temperature drops
Approximately 12 million US households rely on propane for home heating and other residential applications (PERC/NPGA), and for most of them, their propane supplier relationship matters more in January than the invoice. An NFPA 54/58 licensed supplier who has reliably responded to emergencies quickly is worth more than a few cents per gallon discount.
A risk of run-out is not a minor discomfort – it’s bled gas lines, pilot re-ignition service calls, and a really cold house until someone qualified can make it out to you.
Weigh service quality and response time as heavily as price. Ten cents doesn’t mean much if the truck can’t get to you for three days.
Match the plan to your life, not the other way around
The optimal delivery schedule is the one that suits your habits and priorities. If you’re not going to remember to check a gauge weekly, signing a will-call contract in the expectation you’ll take a disciplined approach is not going to work. If achieving as much price predictability as possible is imperative to meeting your budget, a fixed price or budget billing plan will make you less vulnerable to the vagaries of the market than up-to-date pricing. Evaluate your tank, your consumption, and your attitude to fluctuating prices, then consider what your best options are – there are no right answers, only decisions that work for you.
