If you call around and shop for propane prices and wondered why the propane price per gallon varies between suppliers, we’ve got answers.
Although just about any supplier you might choose from has local operations here in southeast Pennsylvania, price can vary widely – and it seems no two companies ever have the same price.
What’s the secret? Well, there are a lot of factors involved!
Although the price of propane is hard to predict, the things influencing it are easier to figure out.
Propane Price Per Gallon and You: A Quick Look at Issues Affecting Propane Costs
It’d be impossible to list all the things that might cause the price of propane to go up or down.
After all, propane is an important commodity millions of people all over the world rely on for heat. Though the U.S. has an ample supply of it, market factors like imports and exports play a role even an economist couldn’t explain completely in a week of Sundays.
But there are some obvious culprits when the price goes up or down:
Supply and Demand
This is the basic one, of course. When supply goes up, prices go down, and vice versa. Local conditions don’t change very often – people have fairly consistent heating needs – but some suppliers work a very large territory. Changes elsewhere can make a difference.
For example, when an emergency takes place, suppliers might donate fuel to relief efforts or find their usual avenues of supply cut off completely. In other cases, a winter storm might spike demand and constrict supply. All these situations affect supply and demand and cause prices to fluctuate.
When and How Propane is Purchased
Propane suppliers purchase from wholesalers at different times. Some suppliers might be more judicious with when and from whom they purchase propane. Kauffman, for example, purchases and stores propane in bulk. We tend to purchase propane at lower prices so we can pass the savings to you.
Propane providers who purchase in bulk offer another advantage: they are less affected by shortages! For example, the winter of 2014 caused shortages of propane nation wide. In South Eastern PA, many propane suppliers were running out of gas. Kauffman, on the other hand, had stored supplies and was able to service many existing and some new customers in the emergency!
Business Overhead Costs
When it comes to energy, there are lots of rules and regulations. Did you know propane delivery drivers have to get FBI background checks? It’s true! Regulations, hiring, training, safety certification, and more all end up in the cost of heating somewhere.
Beware: Low Propane Price per Gallon might have hidden costs
Some companies build overhead costs into the price of propane per gallon. This approach means the price you see is the price you get. Seems fair to us!
However, some suppliers might advertise an extremely low cost per gallon, but itemize these other costs as additional fees on the propane bill. This bait and switch tactic is far too common, which is why you should beware of unusually low propane prices!
Special Incentives
Many times, when people sign up for long-term propane service with a specific supplier, they get a discount on their propane price per gallon. This incentive could also get bundled in with long-term service contracts, referring your friends and family, and so on.
What Can You Do to Manage Your Home’s Propane Cost?
No one has direct control over propane costs, not even producers and suppliers.
But that doesn’t mean the situation is hopeless!
There are four important things you can do to save more money on heating:
Pick a Propane Supplier You Trust
A good propane vendor has a lot of motivation to get your long-term business. Know what to look for in a propane provider near you. This includes their reputation, service record, and convenience!
Ensure Your Propane Appliances are Efficient
Like any other kind of appliance around your house, your hot water heater or other propane-based devices can get worn out over time. It’s important to have regular maintenance done by experts who can repair or replace them. That will make them safer and reduce cost of ownership.
Invest in a Bigger Propane Tank
One way to protect your budget against sudden fluctuations in the price of propane is to invest in a bigger tank. You can cut down on the number of refills you need in a year and top up your tank whenever prices are at their lowest, typically in the warmer seasons.To learn more or even just get the current propane price per gallon, call or email us.
