Propane tank: rent or buy

16 years ago

Any suggestions will be appreciated. I want to know the ins and outs BEFORE I start calling around. I have heard the whole proplane delivery system can be a racket designed to keep you from switching between provider...among others problems.

Anyone have any suggestions. On the one hand I'd think we should start out renting since I am not even sure how much we will use our gas insert; ie for a few hours a few nights a week for ambience or for actually heating the family room. I guess that comes down to how much my electric bill goes down when I use the gas.

From what I have seen, the delivery system seams a bit gimicky. Pay a monthly rental fee, pay more for fuel and no rental fee, pay no rental fee but get socked big $$$$ if you switch companies. SHould I just buy the tank...what size.

Again, advise appreciated.

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bb

16 years ago

my research shows, you might forefit tank contents when you change providers, they do not give you back what is in the tank. if you're regularly getting a 40%-50% fill, yer screwed!

someone posted here a few days ago abot ferrellgas gouging customers. so I looked at my contract..and gulped....

rates do vary place to place and usage amounts, I run stove, dryer and hot water for about $100/mo. in MD

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Comments (8)

mr_havac
16 years ago
I don't know where you live but here in NH you just call one of the LP gas dealers, he asks what appliances will be hooked to gas and how much they will be used. They figure out what size tank to bring to the site, set it in place and you're good to go. The gas supply line has to be in place so they can tie it in and check their installation. If you change suppliers they come and get their tank and the new company brings in one of theirs.
davidandkasie
16 years ago
i pay a whole 30.00 a year to rent my tank, so it made no sense to buy one. i would not even pay that if i filled the tank more than once every 2 years, but a gas dryer only uses so much propane!
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As a route driver for a large national propane company I'd like to clear a few things up. YES,IT IS NOT LEGAL FOR A COMPANY TO PUT GAS IN ANOTHER COMPANIES TANK! It is punishable with as much as a $10,000 fine. Payable by the company putting in the gas if they know or have reason to suspect it owned by another company or you the customer if you lie to them that you own the tank. Why? Let's say company A sets the tank they have several hundred dollars into the tank, manhours connecting the tank, and the resposibility to maintain the tank, which costs $'s. If you then call company B to fill that tank company A recieves no money for their investment. As to whether to own or lease; it is up to the individual, personally I would lease the tank. The reasons are many, for one it is the company's reponsability to maintain the tank: painting it, changing the valves etc., if the regulator leaks or becomes damaged the company replaces it usually free of charge which by the way are by LAW to be replaced every 20 years to name just a few. The company I work for the yearly lease is only $1.00 plus tax all we ask is for your to fill it at least once a year. As to whether to be an automatic customer or a will call customer. Automatic customers, at least for the company I work for are assigned what is called a K-factor which basically depends on how efficient your house is( example an old farm house with little insulation may have a K-factor of say 4; a newer home with the same number of square feetbut with amore efficient furnace and insulation may have a K-factor of say 12). What is K-factor? It is the number of degree days it takes your home to burn 1 gallon of propane. The company I work for has a computer that we enter how many degree days have occured in the previous 24 hours,the computer has in its memory how many degree days have accumulated since your last fill and devide that by the K-factor to find out how many gallons you've used. Also in the computer is the size of your tank, dividing gallons used by the tank size and then subtracting it from 80%(normal "full" level) we can track your tank level. Knowing what your tank level is by using the K-factor method also can alert the driver to a possible leak, because once a K-factor is assigned and corrected the computer level and your actual tank level should be within +/-5% and a steady difference. My company about twice a week, when it is cold, will print out a list of customers who are at or below 30% and then we come and fill your tank. Being an automatic customer also saves you $0.10 a gallon versus a will call customer. As to companies coming out to fill your tank when the price is high; on a good week I can service 125 customers, the branch I work at has 3000+ customers and five trucks. In the middle of winter we will deliver gas to some of our customers every three to four weeks depending on temperature and their K-factor; we can't hold off making delivers till the price goes up. As to when you are changing companies tanks, at least around here the new company sets their tank and fills it and waits for your other tank to get below 5%. The reason we wait till the tank is below 5% is that by law we are not supposed to transport a tank with 5% or more in it unless the total weight of the gas the tank can hold is 1000 lbs or less. Then the new company will come out and change you over to their tank and have you notify your old company to come and get their tank. The reason you may see more than one tank in a yard could be the afor mention switch not yet occuring or the may have a backlog or yards maybe to soft to get a truck in to get the tank. Hope this has cleared up a few points.
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MollyD & others interested in knowing about tank gauges for smaller tanks (22lb - 100lb tanks). Check with a home center or RV dealer. I ran across two lines of products at a local farm & home store that offers it, one was with BBQ accessories and the other was with RV propane accessories. Both are a combo percentage gauge and shut off valve that you install between the tank and the line/regulator. The price is about half or less than the model that you bought. (I like the little flag feature, but if I am running two tanks on a manifold I can check my tanks weekly if need be.) Right now I am between propane dealers, I got into a tank ownership disagreement with the one I have used for over twenty years, and he locked up my tank so I couldn't get it refilled! (Happened in mid January, so I had to buy a 55,000 btu space heater and a 100lb tank to keep my house warm until I could get an electrician out to install some electric baseboard heaters.) As to the smaller tanks being refilled from a bulk truck, most dealers can't do it. The fittings are different for the smaller tanks and the larger ones. Plus they set your tank on a platform scale while filling it to see how much propane is in the tank.
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The rules in our subdivision require that a tank over a certain size (maybe 20 gallons) be buried. Our is over 300 gallons and it is buried. It was no big deal. Excavated the hole when digging the foundation. Poured a concrete pad and inserted bolts. Propane company dropped tank (with sacrificial anodes) into place and chained it down. Hole was backfilled with sand when the house was backfilled. The line runs underground (with safety tape over it so it doesn't get dug up) and there is a very small metal box where the line comes out of the ground and it connect to the back of the house. It's no big deal, a small shrub would completely hide it. The propane company owns the tank (so they say, I never signed anything) and they don't charge for it, but I am only supposed to use them for fills (it's only been filled once in two years). Our utilities are underground and our phone and power meters are on the side of the garage, not highly visible. The transformer is in the woods. The meters and boxes on the house are not bad looking at all. A small metal box for phone and cable, a meter mounted on another metal box with the shutoff for the electrical. They are barely noticeable, but we carely planned where they would go.
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Too late- we're committed! Hopefully, the house is sufficiently energy efficient that it won't be a big deal. Third gas company was a no show and the fourth was hilarious. He quoted $4,500 for the tank and when I told him he was at least $1,000 higher than his competitors he suddenly discovered a "typo" on his price list and reduced it to $3,100. I asked what brand of tank it was and I was told that it's "proprietary" to which I responded- Well if we're buying a tank, THEN do we get to find out? He very seriously told me at that point I'd be able to read the manufacturer off the side of the tank. These people crack me up. One more quote on Monday and I am putting this issue to bed. Someone today actually quoted $1.61/ gal which sounds pretty darn good to me! Thanks for all the feedback- keep it coming, please!
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egor_sb
16 years ago
depends on if your tank is in a hard to get at location. If you live in a remote area and your tank is difficult to get at, I would buy it so you can switch providers based on price and service whenever you want. If its no problem getting a truck and a forklift to remove/replace your tank at any time, then its probably cheaper to rent it and let the propane company set it all up and maintain it.
jeffnette
16 years ago
here in northeast kansas if you own your own tank then everytime you switch suppliers the new supplier will do a full leak test on the lines and regulators and will charge you for thus service. If you stay with one supplier every year then they will still do the test but will not charge you extra....
I just rent my tank, which keeps the liability on the propane company that you are renting from, they are responsible for it all.
bus_driver
16 years ago
Propane prices can vary widely from one supplier to another within a given service area. I was planning to buy a tank when I first needed propane at the house. Fellow tipped me off that the largest fuel oil company in the area was starting propane service and offering good deals to get a customer base established. Installed tank, no rental fee at all. And their prices have been good too. The logo on the tanks and on the trucks is good advertising for them. The more customers, the more exposure.
egor_sb
16 years ago
yes, its not as easy as filling up at the local gas station. If you are renting and then want to switch companies, they will take the tank only once empty or near empty, meaning you lose whats in the tank at the time. But thats easy to plan out. If the difference is more than $0.50/gal and you regularly are buying 2-300 gals. at a time, its way worth it, imo.
The part about charging you for leak testing sounds odd, though. If a company told me that I had to pay them for such a thing for the "priveledge" of spending $1000+/year with them for their product, I'd tell them to take a hike! I asked a few of our local propane companies about this and they said they wouldnt even think of it! They went on to say they would love to get my business and would, for free, check all my stoves, heaters, and furnaces if I switched over to them.
Thats what I would expect, but maybe its a different ballgame in other areas.
jca1
16 years ago
I'm in the LP business, here's my take on this.

Pro's to owning tank: No lease fee, which eventually will pay for the tank anyway but it won't be yours- Can get gas from whoever has the lowest price at the time and can better haggle over price too.

Con's to owning tank: If anything at all ever happens to the tank it's on you, where as if you lease it the company that owns it has to fix it and replace any lost gas.

If you rent and change companies, the current supplier can charge you a pick-up fee but they have to pay you back for the gas. Most companies have a plan in place the determines at what point a customer has to pay rent, usually by the gallons purchased, and if so not every customer has to pay the rent fee.

Personally, I recommend that customers only seriously consider purchasing Underground tanks, but not above ground tanks.

At say $30/year it would take around 30 years for a purchased 500 gallon tank to pay for itself.

Propane tank: rent or buy

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mr_havac

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