5 On Your Side

Negotiating with companies eases pain of propane prices

Posted November 22, 2016
Updated November 23, 2016

If one business charged half the price of another for the same product, usually you'd buy from the one charging less.

Many propane gas customers, though, are paying a higher price for fuel without realizing it.

In recent months, more than a dozen homeowners complained to 5 On Your Side about propane price discrepancies. Some customers were angry after finding out they paid double what a neighbor paid.

With more than 335,000 propane customers across the state, the price discrepancies are a problem.

Whether it heats your home, runs your appliances or sparks the fireplace, propane is a versatile option.

Unlike natural gas, which is piped to homes, a truck delivers propane to a tank that's either above or below ground. Once the tank is filled, you get an invoice that shows the cost.

"I'm like, 'Wait, a thousand dollars? I usually spend $500 dollars. What happened?'" said propane customer Anya McGuirk.

After pricing problems with two propane deliveries, McGuirk wants others to know about her very simple fix.

The first issue began when AmeriGas filled her tank last year.

"So, I called them up," McGuirk said. "Some nice lady answers the phone, (and) I said, 'I think there's a problem with my bill.'

"She said, 'You mean the price, honey?' I said, 'I think somebody in your office must be smoking crack.' I hear some clicking—click, click, click—she comes back and says, 'OK I just credited your account for $550.'"

After just minutes on the phone, AmeriGas dropped the price from $4.21 to $1.99 per gallon—a refund of more than half of what she was originally billed.

"I was dumbfounded," McGuirk said. "Really, because I was expecting that I was going to have to say, 'Yeah, I did the research, and everybody else—I called this other company, and they're giving this price.'"

McGuirk ran into the same situation when AmeriGas filled her tank this year. She said she was originally billed $3.79 per gallon, but then she got on the phone to contact the company.

"(An employee) gets my account up, and she said, 'I don't see a price listed yet,'" McGuirk said. "She said, 'How does $1.99 sound?' (Then) she credited my account."

Richard Fredenburg is an LP Gas Engineer with the North Carolina Department of Agriculture. Fredenburg said there's nothing illegal about propane companies charging those kind of rates, even though it seems unfair.

"Legally, it's OK," Fredenburg said. "Morally, I can't defend it, but you pay different amounts for the same products in different stores."

The Department of Agriculture oversees propane installations, inspections and transportation, but Fredenburg's agency doesn't regulate price. No other organization regulates propane prices, either, Fredenburg said.

"(Propane companies) charge what competition will allow, pretty much," Fredenburg said.

Price starts with competition, but then changes based on the company you use, how much you need, when you need it and how you get deliveries, whether you rent or own your home and even whether you rent or own the tank.

The advice from experts: shop around. But they acknowledge that's easier said than done because many companies, including AmericaGas, charge fees for everything from draining the gas in your existing tank, to pick-up, to disconnect and even a restocking fee.

As for McGuirk's adjusted price, a spokeswoman for the company said, "Our local managers and employees are given wide discretion to adjust pricing with our customers because we know they have many choices in propane companies."

That's why McGuirk believes the simple fix is the one that saved her nearly a $1,000.

"You have to call them up and negotiate," McGuirk said.

1 Comment

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  • Kenneth Jones Nov 24, 2016
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    This is a good story, especially for the oncoming winter. I'm surprised anyone would charge so much for propane these days, but it's nice to know you can negotiate down. Personally, I would like to know the price before I purchase.