Periodically, the Town Crier has sought information from Hill propane suppliers regarding pricing and other matters. Some companies will talk to us, others won’t.
Propane suppliers are private companies, not regulated by state public utility commissions in the way public utilities such as natural gas, electric and water are regulated. And because pricing is based on market supply and demand, price per gallon charged by Hill suppliers can vary widely — from lows in the $2 range, up to high $4 or low $5 a gallon.
It’s important that propane customers are savvy about what questions to ask before signing contracts or reaching agreements with Hill propane suppliers.
Price per gallon is only one component of being supplied propane. Other questions regard whether to pay annual tank rental charges (from the supplier) or buy a tank. Owning a tank often affords price per gallon discounts from suppliers and can allow a tank owner to switch propane suppliers more easily.
There are important questions regarding general servicing. For instance:
• What has a lower per-gallon price, larger or smaller deliveries? There are sometimes additional charges for customers who use less propane over tracked periods.
• Is the quoted charge an “introductory offer”? If so, it is important to ask what your price per gallon will be on your next delivery?
• Are there added charges on your bill to be aware of such as fuel surcharges, regulatory compliance fees, HAZMAT and others, or are they included in the cost per gallon? Be certain to ask and then review the bill for accuracy.
• If one runs out of propane, is there an added charge to make an emergency delivery?
• Should you have a “fill as needed” contract where the supplier inspects your tank and fills it, or should you have a contract where you call in when you want your tank filled? If you forget to call in and your tank goes empty, you may have to pay a penalty.
• If one runs out of propane and their regular supplier does not respond in a reasonable time, can or will another company fill the tank?
• What can you do if you change companies and your old company won’t pick up their tank?
Bottom line: Ask questions. You are the customer and suppliers will either answer your questions directly to your satisfaction or they will not. How they answer should help customers decide what suppliers to use.
Pricing
Other than that price per gallon can vary widely during the propane season — less in the fall and more in the middle of winter — prices are based on price per gallon at a central supply source, such as Mt. Belvieu “Spot Price.” Local suppliers then add on transportation costs from point of original supply to supplier storage facilities, and then transportation costs from storage facility to residence or business.
Over the last 10 years, Mt. Belvieu, Texas, spot price per gallons has gone from a high of $1.917 per gallon during the week of July 18, 2008, to a low of $0.308 during the week of Jan. 22, 2016.
The current Mt. Belvieu spot price is $0.739 as of the end of November 2018. According to the U.S. Energy Information Administration, the average propane price per gallon throughout the U.S. on Dec. 3, 2018, was $2.43.
Each propane review article for the balance of the heating season, we will talk with a different propane supplier, and get their pricing and other information that could be helpful to customers, especially first-time Hill propane customers.
This week we talked to Billy Owen, co-owner with Robert Summerall of Advantage Propane. Owen, who has previously worked with SoCal and AmeriGas Propane suppliers, said he has worked all aspects of the propane business from driver to administration.
“We treat our customers fairly,” said Owen. “We don’t have term contracts, other than for a tank lease. Our current price per gallon is $2.59. The only additional fee we charge is a HAZMAT fee [no fuel surcharge or regulatory compliance fee].
“Our tanks rent for $55 annually for a 250-gallon tank and $90 for a 500-gallon tank. We don’t have any ‘first fill’ pricing. We have a 30,000-gallon tank storage field in Beaumont that allows us to be competitive. We’re in Idyllwild a couple times a week. Our customers can either be ‘on a route’ where we monitor and fill as needed or on a ‘will call” basis. Also, if someone accidentally runs out, we do not charge a fee for a special fill.”
We encourage readers to contact us regarding what they are paying per gallon, other fees they are being charged, and how satisfied or not they are with their propane suppliers.
