How Much Does Propane Cost?
Propane is a gas that is formed from natural gas and petroleum refining. It can be used for many things such as fuel for engines (not auto engines, though), barbecues, stoves, and even central heating. The most common uses for propane are grills and stoves. However, for some people in certain situations, propane is the only option when it comes to heating or running a home. For those that rely on propane or are simply researching it, it must be understood that propane prices are a lot like gas prices — they are going to rise and fall with the market. However, there are some estimates that we can give you to help you better understand what you should budget for when it comes to filling up your propane tank.
How much is it?
- On average, residential propane is going to vary anywhere between $2 and $4 per gallon. Again, this is going to heavily depend on the market at the time.
- As of December 2012, the average propane price was $2.41 per gallon.
- The typical home that uses propane to heat and use appliances can use anywhere from 1,000 to 2,000 gallons in a season. Doing the math, this can cost the average homeowner anywhere from $2,000 to as much as $6,000 a season.
- To get up to date propane prices, CheckPropanePrices.com is a great resource to show you exactly what other homeowners are paying.
- The official Michigan government website also has a real-time chart showing you what the current average price for propane is.
What is going to be included?
- When getting a propane quote from a local company, most will ask for your propane tank size, the zip code and a tank confirmation if it is being leased.
- Propane is enhanced with an odorant that gives it a very distinct smell. This allows people to be able to tell immediately if there is a propane leak somewhere.
What are the extra costs?
- Depending on the supplier, some may tack on additional delivery fees. If they do, be prepared to pay anywhere from $10 to $50. While this rare, it is something to look out for.
- When it comes to residential propane, you will either need to lease your own tank or purchase it outright. Depending on the type, the price will be anywhere from $500 to as much as $3,000 to purchase. Leasing can cost anywhere from $75 to $300 per year, depending on the size.
Tips to know:
- Some propane companies will not give you the prices ahead of time; instead, they will offer a “fixed” rate. This is something that you want to avoid. Always make sure that you get the prices in writing before you ever accept a delivery. These fixed prices may seem like a good deal when the market is high, but you can end up paying a lot more when the market prices fall and you are still paying the higher fixed rate.
- Keep in mind that when you lease, you are tied in with that supplier as long as you are leasing it. If you want to have the freedom of purchasing your propane from a different company, you may want to consider buying your own tank.
- According to Propane101.com, 1 gallon of propane can produce 27 Kilowatt hours of power. However, this will also depend on the use of the propane. A gas grill uses much less propane than a central heating system will use.
How can I save money?
- Like a gas station, there are many different suppliers that can come to your home and fill up your tank. This is why it is always best to compare at least three different suppliers before signing a contract. Get in the habit of doing this at least once a year to make sure that you are getting the best price possible.
- Ask about special discounts ahead of time. Frequent and loyal customers are often given lower prices. Also, if you pay for the whole year in advance, you will probably get a lower overall price. If going this route, just make sure that you compare the final price to ensure that it is a fair price.
- Propane groups are a fantastic way to save money. Get together with some other homeowners and consider buying your propane at once. By doing this, you can upwards of 10% to 20%.
- Some homeowners claim that filling your propane tank in the summer months can actually be a pinch cheaper than the winter months due to demand.
- If you cannot afford your propane, many states have local assistance programs set up that can help you with payments.
- The best way to save money on propane is to avoid waste. If you are using it for something simple such as a grill, make sure you close the nozzle of the tank as well as turn off the burners. If you are using it to heat your home, make sure that you only use as much as necessary – do not run the heater constantly!