WAY OT: How is Heating Oil Billed?

[Suminod]

I cannot for the life of me, understand how most heating oil utility companies bill their customers. I've always have had gas heat so having oil-heat is entirely foreign to me. I apologize to all ahead of time for posting such a trivial/non-basketball question.

What I don't understand is the oil bill at my mother's house is $280.00 every month regardless of the time of year. I remember having gas bills of $12/month during the summer at my condo and at most having to pay around $200/month during the peak season of winter. I'm being told that there was an agreed monthly amount reached between my mom and Hoffman Energy so that's why its a flat fee each year.

My question is do any of you that still use oil think that 280/month is too high? Is it about average? House is a modest, 3-bedroom ranch. Since crude oil prices are pretty low compared to the days of $100/barrel, shouldn't I negotiate a new deal w/ the oil company? I'm not even sure what that 280/month is based on. I'm assuming it's on her past use of the quantity of oil. I also anticipate that the oil-use in the house will be a lot less than when my mom was still living in the house so shouldn't that be taken into account?

Again, sorry for the way OT post but figured this I'd see what others on this board think...

 

[uconnell]

Your mom probably used more oil to heat than you will,as the elderly feel cold most of the time. We have a small 3 bd rm house also, hardly any insulation,shut the furnace off at night (except on very cold nights) and burn 400 gal over the season. L found that as get older the gal usage goes up.

You can try to get it lower but she probably signed a contract, but yes it does seem very,very high monthly payment. Find out what the gallon per season she signed up for. Definitely call them.

 

[scrappy2.0]

I cannot for the life of me, understand how most heating oil utility companies bill their customers. I've always have had gas heat so having oil-heat is entirely foreign to me. I apologize to all ahead of time for posting such a trivial/non-basketball question.

What I don't understand is the oil bill at my mother's house is $280.00 every month regardless of the time of year. I remember having gas bills of $12/month during the summer at my condo and at most having to pay around $200/month during the peak season of winter. I'm being told that there was an agreed monthly amount reached between my mom and Hoffman Energy so that's why its a flat fee each year.

My question is do any of you that still use oil think that 280/month is too high? Is it about average? House is a modest, 3-bedroom ranch. Since crude oil prices are pretty low compared to the days of $100/barrel, shouldn't I negotiate a new deal w/ the oil company? I'm not even sure what that 280/month is based on. I'm assuming it's on her past use of the quantity of oil. I also anticipate that the oil-use in the house will be a lot less than when my mom was still living in the house so shouldn't that be taken into account?

Again, sorry for the way OT post but figured this I'd see what others on this board think...

Long Hill Oil Clinton CT I live in Madison and simply call when I need it and leave a check taped to my door--simple as that. At this time of the year they start getting busy as most people have not used oil for 3-4 months . An oil bill of 280 a month? I have a 3800 SQFT house with 5 people in it. The costs vary from absolute zero usually from mid May to mid Oct if you fill in May--then it could go as high as several hundred a month depending on price/usage. Maybe your mom is on a scheduled payment so that the disparity in cash from winter to summer is billed evenly to keep her bills in order.

 

[Suminod]

Thanks uconnell, I will certainly do that.

 

[ctchamps]

It should be a contract for one year. Find out when the contract was made and when the year expires shop around or skip a contract altogether. With oil so low a yearly contract isn't a bad idea. You never know when some major interruption in oil supplies could precipitate speculators from pushing up prices.

 

[Suminod]

Thanks to all, it's helpful I'm getting a baseline of what others are paying. From what it sounds like, she's def paying too much. I just made a quick call and they stated that is wasn't so much of a contract, rather, it was the agreed budget on what she'd pay per season and it was divided monthly (but isn't that what a contract is?). They also stated that it's capped at 3.17/gallon and that stipulation expired on July 2016.

 

[B1GEast]

How old is the furnace? You may want to upgrade or you can have a device that reduces the amount of oil used if you don't need that many btu's to heat your home, also consider newer windows as well. There are a lot of companies that can do an energy audit. Save where you can.

 

[HooperScooper]

Our house is about 2600 sf and we use approximately 1000 gallons of oil every year (for heat and hot water). Depends also how well insulated the house is. Spot price for oil must be around $2.30 a gallon today.

If she's being charged a flat monthly fee it's probably because she signed a contract where the oil company takes your average annual consumption of oil, multiplies by the current price and divides by 12. The contract also could have a fixed price for the oil per gallon. Some people like certainty. In times where oil prices are going down that's not a good idea. They then true up at the end of the 12 months of the contract. So if you used less oil or the actual price of the oil at the time of delivery was less (if you didn't lock in the price) than they used for the initial pricing then you get money back. This is an option that a lot of people who are on a fixed budget like to keep their monthly bills the same. We just pay after each delivery. So in the winter our monthly bill might be $500 or more but in the summer we don't have any oil deliveries so it's nothing. You need to see what contract she signed.

 

[8893]

Our house is about 2600 sf and we use approximately 1000 gallons of oil every year (for heat and hot water). Depends also how well insulated the house is. Spot price for oil must be around $2.30 a gallon today.

If she's being charged a flat monthly fee it's probably because she signed a contract where the oil company takes your average annual consumption of oil, multiplies by the current price and divides by 12. The contract also could have a fixed price for the oil per gallon. Some people like certainty. In times where oil prices are going down that's not a good idea. They then true up at the end of the 12 months of the contract. So if you used less oil or the actual price of the oil at the time of delivery was less (if you didn't lock in the price) than they used for the initial pricing then you get money back. This is an option that a lot of people who are on a fixed budget like to keep their monthly bills the same. We just pay after each delivery. So in the winter our monthly bill might be $500 or more but in the summer we don't have any oil deliveries so it's nothing. You need to see what contract she signed.

This^^^.

It's likely a form of budget plan, which is what we do. Here are the options our oil company has:

http://wilcox-energy.com/payment-plan-chart/

We do the budget plan with price protection, which locks us in at a capped maximum price and charges a monthly fixed rate for a 12-month period based on the then-current price multiplied by your usage last year. If the price of oil goes down we still pay the lower price, but there hedging fee for locking in (iirc I stand to lose something like $60 over the life of the contract if the price never goes above our locked rate). We get a credit at the end if we've used less oil or if the price goes down; we have to pay a balance if we use more or if the price goes up. You should see which plan she has and take it from there.

 

[August_West]

I used to do the budget plan, and locking in low right now doesn't seem like a bad play.

The last two years though I have simply shopped around ( I think I've used at least 3 different companies) at fill time and paid for the fill at the going rate and have saved a considerable amount over what I was paying before that.

It can be a risk though.

 

[Rewster]

We used to budget. I now use a website called cashheatingoil.com whenever we need oil. All you need to do is put in your zip code and they will tell you the lowest prices in your area.

They won't tell you the name of the company until you commit.

It has been much cheaper for us so far(been using for about 9 months).
The drawback of course is you pay the whole nut at the of delivery. In the winter months it can be difficult with the holidays(2 kids).

In my area right now you can get oil for about $1.82 a gallon

I have no affiliation to this company

 

[SubbaBub]

meh, I think I calculated once that the price of oil had to swing by 50 cents a gallon to make the lock in worth the fee. There are many types of plans, you'll need to run the numbers based on the expected usage (800-1000 gal/yr is a decent guess), the current price of heating oil and the expected trend for the heating season. Your mileage will most certainly vary.

 

[8893]

I have no question that there are less expensive options if you want to shop the companies and you don't mind paying attention to your oil gauge and monitoring your usage. I use the same company to service our furnace and our A/C units and I don't mind overpaying a little to get great service, which they have provided us for more than 15 years now, in two different houses. They make clear that they give priority service to the customers on their plans. I have a household of girls and women. They have come out in the middle of the night, on holidays, and in snow storms with no issue and no upcharge whatsoever. We've got a long driveway on a decent hill and winter deliveries can present challenges, but these people know to send certain drivers for us to make sure we get our deliveries. Last winter alone that mattered a couple times.

 

[uconndennis]

www.cashheatingoil.com do it

 

[noeynox]

3K, a year doesn't sound too bad, but 280 in summer months would kill me. We have about 2k sq ft ranch. a few years back during a brutal winter we spent almost 6k, but that is cause my wife can't walk past the furnace without turning it up. Bought a wood stove insert as a supplement and spent about 900 on wood and 1800 on oil last year.

 

[WillB4]

I have been 'prebuying' oil for fifteen years. I have been hurt (price paid for in Aug is higher than price going through winter) only two times, so over all I'm way ahead than buying as needed. I use approx 550 gals a year which includes heat and hot water. I've hooked up with a local oil company and have at first put in a new burner (saved a few bucks) and then changed the whole system including going over to a two zone system (saved a lot more). We keep the thermostat at 68 degrees and that seems fine for us.

 

[UConnKev]

We bought a 1800 square foot colonial about a year ago in Rocky Hill and we have found the best price came from Mims Oil out of Meriden; they post their prices online which is a bonus for the savvy shopper. Right now they are at $2.04

 

[Jaker]

Glad I have NG, my bill is only like $35 in the summer and $80-100 during the winter.

 

[jibsey]

Oil could bounce up, in fact the last few days has (barrel). If someone can lock you in at a good price now, not much downside. Oil was close to $4 a gallon not that long ago and could head back with any kind of crisis in the world.

 

[uconndennis]

We bought a 1800 square foot colonial about a year ago in Rocky Hill and we have found the best price came from Mims Oil out of Meriden; they post their prices online which is a bonus for the savvy shopper. Right now they are at $2.04

You shouldn't be paying more than $1.80 a gallon right now. Seriously guys, if you have oil, you have to use www.cashheatingoil.com

you buy on demand and agree to a price and then find out who the dealer is..... Ive been doing it for over a year and generally get the same 2 or 3 vendors

 

[The Viking]

I use cashheatingoil.com as well and love it. They do cash or credit and you almost always get it within 24 hours. Some even claim same day if you order early enough

 

[Duncan Idaho]

http://www.newenglandoil.com/conn.htm
click in your area, gives you an idea what others are offering. The home page directs for all six states.

 

[UC313]

Another one for cashheatingoil.com here. Ive used it the last 2 seasons and the hell with anything else. Im a last minute guy, my last fill up was 249 gals, and I paid $1.81 a gal.