The price for the pre-paid plan for next year has come out – $2.59 /gallon and they said they don’t expect any change to the rate with the oil price falling. But their daily rate today is $2.09. We are considering not going for the pre-paid plan this year.
What are the home heating oil rates in your area and any thoughts on the pre-paid plan this year based on oil price dropping?
You may want to look into the heating oil futures markets to get an idea of how Wall Street is pricing heating oil for delivery at a later date. Of course, the price you pay would be higher due to retailing/delivery costs and such.
You might want to read this thread from last May.
I don’t prepay. I am on a 10 month plan. I lock into a higher price then the pre-pay price and if it goes down when delievered I pay the lower amount. My lock in for the 2015-2016 heating season is $2.99. Last year I locked in at $3.89, iirc, but the price fell so much my monthly budget was reduced $60 a month, iirc. I went down another $8/month this year.
I just had my first delivery of season in the middle of July. PPG was $2.61.
We prepaid. It’s just a bill I don’t want to get every month all winter long.
NYSERDA avg rate in NY State is currently $2.79 and my area is at $2.68 and Long Island is at $2.94. Your prepay price is good and your market rate is even better.
Do you save your delivery tickets to compare usage, price per gallon, and annual cost? My suggestion would be to call your company and ask them questions about which option is best for you.
Something is confusing here. For us, “pre-pay” means the ten month plan. They pre-calculate, based on the plan pricing they are offering and last year’s total number of gallons, then divide by ten- and will reduce the monthly tab, if everything plateaus lower. That way we pay an even amount through the worst months. If we use less than expected, they reconcile and our last month bill is lower or we get a credit.
We have 3 choices- day rate/take your chances; fixed rate; ceiling plan.
In the past 4 years or so, the fixed rate was not our best option. Sure, if the price exceeds, say, 2.59, super. But for us, the day rate only went above that fixed rate for one or two months, IF at all.
So we do the “cap” or “ceiling rate” plan. Deliveries are priced on the day rate, never to exceed the cap. I think what OP needs to ask about is whether there is a ceiling plan.
Thank you everyone for the responses. @TonyK, I do have the past delivery tickets. I will compare the annual usage pattern and annual cost. @lookingforward, our pre-pay plan is different. This is how it works with few oil companies in our area.
They fix a pre-paid annual rate and send out letters to current customers. We can call and get that rate also. We then can pre-buy certain number of gallons of oil in that rate for the year, paying upfront. They deliver it automatically based on previous year’s usage or we can call and ask them to deliver. If we run out the pre-paid gallons before the season, we have to pay the daily rate on the day of the fill for the rest of the year’s use. If we have left over gallons from the pre-pay, they will refund us either the rate we bought the pre-pay, or the rate on May 31 – whichever is lower. (We never get more than we need). The pre-pay program runs from Sept. 1 to the following May 31st. I will call and ask if they have the plan you explain and about “ceiling cap”.
LF, people who have per-paid plans pay the whole cost of their yearly oil at once. The PPG is lower than the PPG guaranteed with what you are paying if you have a ceiling plan (I call it a capped plan.)
Thx for the explanations.