Lock in propane pricing during summer to avoid price gouging

AmeriGas lock in rate

IONIA, Mich. – It seems ironic to debate the pricing of propane for this winter, but according to gas companies like AmeriGas and the Michigan Propane Gas Association, summer is the time to lock in propane rates.

“Buy propane when it’s cheap and it’s right now,” said Joe Ross, a representative with the Michigan Propane Gas Association.

Ross told FOX 17 that it is just as smart for consumers as it is for retailers to lock in prices for propane for the upcoming winter during the summer when the gas demand is low. This helps ensure that Michigan has a strong source of propane Ross added.

AmeriGas Director of Corporate Communications Kate Stickel said customers should shop around and then establish their supplier early. Many gas companies like AmeriGas offer a voluntary premium program for customers to lock in a lower rate for propane fills throughout the winter.

Yet several Ionia families who rely on propane told FOX 17 that as they shop around in July the prices they are finding are disturbing.

“I can’t imagine how horrible feeling it is for a family with children to worry that they’re going to run out of gas for heat because they cannot afford to pay their Rural bill,” said Rebecca Speer, a Montcalm County resident.

Speer told FOX 17 that last winter alone she and her family burned 799 gallons of propane; and for the last 20 years they have bought their propane from AmeriGas/Rural in Ionia. But, when Speer got the annual letter from AmeriGas asking if they would like to lock in their rate for this winter, Speer said it made her decide to keep shopping.

“We got this letter from AmeriGas saying we had to spend $99 to freeze our price at $2.71 a gallon,” said Speer. “So I called around and everybody else is paying $1.89 a gallon, and AmeriGas’ new customers are only paying $1.499 a gallon.”

When Speer went to her local AmeriGas office and asked the company to waive the $99 lock in fee, or to receive the new customer rate of $1.89 per gallon, AmeriGas said no. Speer said AmeriGas did offer to lower her rate to $2.59 per gallon, but a savings of $.12 per gallon did not satisfy Speer.

When FOX 17 spoke with Stickel, she said that the introductory new customer rates are only available for new customers. However, Stickel encouraged customers like Speer to visit their local office to negotiate rates.

As for the $99 fee to lock in the propane rate for the winter, Stickel said this is a voluntary premium program: AmeriGas can guarantee customers propane throughout the winter season, and at a lower rate, if customers lock in because of a lower demand during the summer.

Speer still shook her head.

“I’m paying almost a dollar more if I paid them this $99, which we’re not going to do that,” said Speer. “We’d like to get our price down to the $1.899 just like the all the customers that they have now.”

For customers still shopping around, gas companies like AmeriGas suggest also considering a pricing plan. For example, lock into a guaranteed price then pay a monthly propane bill, or buy an annual number of propane gallons in advance.

Finally, gas companies remind customers to look into a company beyond their price per gallon, and evaluate the company’s service and reliability.

“What we’re excited about is we’re getting more calls than we ever have from homeowners that want to buy their propane cheaper, right now in the summer, and lock into a good price,” said Ross.

Also, to save more money, Ross said to look into making your home more energy efficient.

“We love to teach people how to use less of our product. So sealing the home is the smartest thing you can do,” said Ross.

For specific tips on heating and energy efficient tips see http://www.heatingmyhome.org

If you feel like you have been scammed or that a propane company is violating the Consumer Protection Act, call the Attorney General’s Consumer Protection Division at (877) 765-8388, or file an online complaint at http://www.michigan.gov/ag

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8 comments

  • Jose Lopez

    After the treatment we had by Rural Gas this past winter we will not be returning to them again, they literally talked to us like they had us by “the short n curlies “,plus they also told us that there was a shortage so customers were only being allowed half fills then the driver said that was a lie n he didn’t know why they would say that when their tanks were all at 100%, my boss was told the same n he is on a keep full plan, what they were doing is selling it at a higher price to other customers n holding back on himbbecause he was locked in for much lower than others, its a war they are waging on our pockets n I as the soul breadwinner was angry! I advise u shop around and read between the lines closing because they will tell you whatever it takes to make a buck at our expense!

  • Heather

    Gas Production Co out of Vestaburg is great! 1.549 for new customers with a lock in at 1.899.. and their service is excellent!

  • Rebecca Emelanderspeer

    Hello, speer here, the day of my interview with Dana. I spoke to another montcalm resident, just the day before he purchased fuel from Amerigas , I believe he said1.79 gal. Why is it so different per customer. Part of those20 years using Rural/Amerigas I was also in Ionia County and Rural never did this, so I can only conclude that Amerigas is the source of the problem. Thank You

  • Willowbilly

    Let me cheer you up a little. If you guys were in Alaska, you would understand true price gouging. I had my bulk tank filled last week by Amerigas at $4.94 per gallon. They didn’t even kiss me on the cheek. Not hooked 12 months ago with the new customer rate of $3.42 per gallon. Up over $2.50 a gallon in 12 months. Ouch.

  • Caliber44

    IF THERE EVER WAS A NEED FOR THE FEDS TO GET INVOLVED, IT IS IN THE PROPANE GAS INDUSTRY !! IT SEEMS LIKE THEY HIKE THE PRICE UP FOR ANY REASON, AND THEN LIE TO THE CUSTOMERS AND THEN THEY HIKE THE PRICE UP AGAIN WHEN IT GETS COLD,… SO WHY ARE THE FOLKS IN THE MIDWEST WHERE IT DOES NOT GET SO COLD PAYING THE SAME AS FOLKS IN THE NORTHEAST WHERE IT GETS MUCH COLDER MUCH SOONER ?? WHY IS THAT ?? WHY CAN’T THEY PRICE PROPANE BY THE AMOUNT EACH STATE SELLS AT ANY GIVEN TIME OF THE YEAR ?! IT SHOULD BE CHEAPER THE FURTHER SOUTH YOU LIVE, AND WHEN IT GOES UP IN THE NORTHEAST BECAUSE OF COLD WEATHER, THEN WHY DOES IT GO UP EVERYWHERE EVEN WHERE IT IS STILL WARM ?? I SAY ITS A RIPOFF BY THE CONGLOMERATE COMPANIES THAT SELL PROPANE, OTHERWISE IT WOULD BE SO EXPENSIVE !! IT IS MOST SAD FOR THE PEOPLE WHO CAN NOT AFFORD TO PAY SUCH HIGH PRICES AND HAVE TO SAVE ALL SUMMER JUST TO GET A HUNDRED GALLONS BEFORE WINTER, AND MOST CAN NOT AFFORD TO GET A FULL TANK EVEN THOUGH THERE ARE PLACES TO GET HELP WITH THAT !! WE ARE ONE OF THOSE UNFORTUNATE PEOPLE WHO CAN NOT AFFORD TO PAY THAT MUCH, SO WE USE ELECTRIC HEATERS, AND KEEP THE FUNACE ON OR ABOUT 60 DEGREES IN THE WINTER MONTHS, AND SOMETIMES HAVE TO LOWER IT TO ABOUT 50 DEGREES JUST SO WE WILL NOT RUN OUT BEFORE WE CAN AFFORD TO BUY SOME MORE !! OUR STOVE IS PROPANE, SO WE COOK OUTDOORS A LOT USING WOOD, AND CHARCOLE, EVEN IN THE WINTER OUR NEIGHBORS THINK WE JUST LOVE TO GRILL OUT, BUT I JUST USE THE GRILL WHEN ITS LIT JUST NOT TO WASTE IT… WE CAN’T USE IT FOR HEAT, BUT WE CAN SAVE ON PROPANE BY USING IT IN THE WINTER MONTHS… WE DO NOT USUALLY TELL OTHERS WE ARE THAT POOR, BUT OUR BILLS PREVENT US FROM SAVING ENOUGH TO FILL THE TANK WHEN NEEDED, SO WE JUST MAKE DO WITH WHAT WE HAVE UNTIL WE CAN AFFORD TO BUY MORE !!! JUST LIKE NOW, THE PRICE IS WAY TO HIGH BUT AT LEAST ITS BEEN WARM HERE LATELY !!! HOPE THEY DO SOMETHING TO PREVENT SO MUCH GREED !!!! THATS THE MAIN PROBLEM, GREED !!!