Your Options for Buying Heating Oil

Posted by Josh Garrett on August 5, 2009 at 4:20 pm

Heating Oil Delivery Choices

FULL SERVICE, CONTRACT OIL

Many consumers opt for this route because it’s easy, safe and hassle-free. While this option is more expensive than buying heating oil alone, over time the coverage, safety and convenience of a service contract backed up by a quality company is worth the extra money. Additional benefits include:

Parts coverage: Like your car, a service contract usually covers several parts on your heating oil system that will be replaced or repaired if they become defective. Parts can be expensive, so automatic coverage here will save you money.

Labor coverage: If your oil company replaces a part that is covered on your contract, they will usually make the repair without charging you for labor—no matter how long the repair takes. Like electricians and plumbers, certified heating technicians have high hourly rates and a big job could cost easily you thousands.

Cleaning and tune-up: For optimal performance and life, your heating system needs annual cleaning and tuning. This will keep your system running as efficiently as possible and minimize costly breakdowns. This service typically costs $100-200 dollars but most full-service companies offer this for free to their customers.

Automatic delivery:  Sophisticated software systems help oil companies track weather and estimated use, and accurately monitor your supply. You’ll never run out of fuel oil because they’ll automatically deliver when you start running low. If you’re not home when they deliver, no problem. Most companies can easily fill up and leave you a metered delivery ticket for your records.

Emergency service: This can save you big money and discomfort, should you need immediate service help. Being without heat isn’t just dangerous to your health, but can cause pipe and structural damage to your home. Fixing a heat problem as soon as it arises before it develops into a bigger problem will make all the difference.

CASH ON DELIVERY (COD) OIL
Many people choose to buy their heating oil direct, without paying for extra services and maintenance because it can be much cheaper, sometimes as much as 50 cents per gallon. This can add up significantly during a long, cold winter and in tough economic times, so it’s no wonder people often go with this option. Unfortunately, many consumers look at the lower price tag and see a better value, when in fact this is a bare-bones package. If you buy COD oil, or are thinking about it, make sure you consider the pros and cons, and make an informed decision. Common problems with COD oil include:

Uninsured companies: Profit margins for many COD companies can be tight, and to cut extra costs many will have only basic insurance policies. That means you could get a delivery of hazardous material for your house by a company with no environmental insurance, or if a driver hurts himself on your property while making a delivery and the company doesn’t carry worker’s compensation, then you could get sued.

Non-uniformed drivers: Drivers for COD oil companies generally don’t wear uniforms, which makes identifying delivery technicians difficult and puts you and your home at greater risk for harm.

Poor quality oil: Shady practices among some COD companies have unfortunately tainted the reputation for others. Some dealers cut their oil with anything from water to used motor oil, and this substandard oil not only damages your heating system, it can potential ruin or shut it down completely. The number one reason consumers stop buying their oil direct is due to extremely poor quality oil.

No service contract: When your boiler has an issue you can’t fix yourself, you’ll have to call a plumber or electrician. If this happens late at night, in the middle of winter, you can bet you’ll pay through the nose for quick service.

No maintenance: A good tune up and cleaning costs on average $100-200 dollars, and your boiler needs this annually for optimal performance. Even if your system is brand new you need to take good care and keep it in well-tuned condition, otherwise you will have to replace it much sooner. If you don’t have this bonus in your contract, it’s easy to skip or disregard until something goes wrong (and then you’ll certainly pay more).

COOPERATIVES AND BUYING GROUPS
To get the benefits of full-service without paying full-service prices and having more options beyond limited COD oil delivery, many consumers have joined a co-op or a fuel-buying program. These cooperatives act as professional negotiators and use the collective buying power of their members to negotiate better prices and service options from local full-service dealers. Many co-ops exclusively deal with full-service oil companies, so this a popular way to find considerable discounts without sacrificing quality or service. In general, coops do charge a reasonable annual membership fee (around $25 a year), and for most members, having a professional group handle the oil company on their behalf is well worth the small investment..