Forecast to be higher next winter

Editor’s Note: The winter heating season historically runs October through March. This ends our review of Hill propane prices for the winter of 2016-17.

Propane price have held steady over the last two weeks. The spot (point-of-production) price is down from $0.733 per gallon two weeks ago to $0.628 as of Monday, March 6 (price reporting from national agencies is delayed one week).

Residential delivery prices have held steady, with minor reductions. The national average is down from $2.447 per gallon two weeks ago to $2.402 as of Monday, March 6. In the Western region, those comparables are $2.543 two weeks ago to $2.492 on March 6.

The U.S. Energy Information Administration published a short-term energy outlook on Tuesday, March 7, predicting a colder heating season in 2017-18. The forecast is based on information supplied by the National Oceanic and Atmospheric Administration.

Five percent of U.S. households heat primarily with propane, according to the EIA. “EIA expects these households to spend less on heating this winter than in eight out of the past ten winters, but more than last winter, when both heating demand and propane prices were low,” noted the report. Fuel expenditures for individual households are highly dependent on the size and energy efficiency of homes and their heating equipment, home insulation, thermostat settings and local weather conditions.

If the coming winter is 10 percent warmer than forecast, according to the EIA report, average propane prices could be 6 percent above this winter’s prices. If it is 10 percent colder than forecast, those prices could be 49 percent greater than this year’s average.

Before reporting local supplier prices, it is important to note that propane prices change daily. Prices quoted to the Town Crier by suppliers may have changed by the time of publication, much less by the time of billing by suppliers.

Dave Castaldo, AC Propane, one of the first local suppliers to begin sharing propane per gallon delivery prices, stressed that prices he quotes can vary to some degree. “I know the price when I pick it up,” he said. “There are many factors affecting price and if a refinery goes down or offline, that can immediately affect pricing.” Castaldo explained that his most recent pick-up price was actually $2.79 per gallon two weeks ago because of two refineries having supply issues that affected their price to him. That differed from the $2.39 he had estimated and quoted to the Town Crier prior to his actual pickup of the propane at point-of-production and storage.

AC Propane, Amerigas, Diamond Valley and SoCal Propane are the suppliers that quote prices to the Town Crier. As of Monday, March 13, supplier quotes are as follows:

  • AC Propane: $2.79 per gallon, but could be as low as $2.39, and generally 40 cents less per gallon for owner tanks;
  • Amerigas: $2.19 community pricing;
  • Diamond Valley: $2.47 per gallon or $2.27 per gallon for owner tanks;
  • SoCal Propane: $2.77 per gallon or $2.47 per gallon for owner tank with 10 cents per gallon discount for vets (permanent) and for referrals (for heating season for customers referring and for those referred). Suburban and Ferrellgas do not share pricing with the Town Crier.

Readers are advised to check per-gallon pricing with their suppliers when ordering a refill or simply check on a regular basis if on a “fill as needed” basis to be aware of price fluctuation. Propane prices can fluctuate widely during a heating season and consumers are responsible for policing their pricing.

Readers have shared some of their negative experiences with Hill propane suppliers. From those stories there are certain cautionary steps propane users should take:

  • Check your tank regularly to monitor how much propane you’re using and if that seems reasonable based on your use for heating, cooking and water heaters.
  • If you suspect a leak, request an immediate leak check. Propane suppliers are under an obligation to check the tank if a customer suspects a leak. According to SoCal Propane CEO Andrew Kotyuk, “If a customer reports they think their tank is leaking, the supplier must absolutely go out to check to make sure the tank is safe. It’s a supplier’s duty to protect them [the customer] and yourself [the supplier].
  • Ask before delivery what your price per gallon will be, inasmuch as propane prices fluctuate, generally becoming more expensive as the heating season wears on.
  • If you’re on a supply-as-requested basis, when ordering less than a tank fill, ask for email or written confirmation of the amount you requested, as well as the price-per-gallon you will be charged;
  • With any requested action, ask if there is a charge for that action and how much that is, such as how much to check if a tank is leaking or any other action, such as an emergency fill.