How To Avoid Minimum Use Fees
We understand that getting charged a minimum use fee can be frustrating and confusing for our valued customers. In this blog post, we want to address your concerns, clarify these fees, and offer solutions to help you avoid them.
What are Minimum Use Fees?
Minimum use fees are different from leases because fees can be avoided by simply using the required amount of fuel. Leases are paid no matter what you use. We offer customers the use of our tanks and equipment at no cost if a minimum of 150% of usable fuel capacity is delivered within the year. If you use the minimum amount, there is no yearly fee.
Why Does Hall Charge Minimum Use Fees?
Minimum use fees serve several purposes:
- Tank Expense. First, tanks are valuable investments, and as steel prices rise, their prices naturally follow suit. Tank costs have doubled in recent years. Ensuring that our tanks are in use is crucial for maintaining our operations. It’s not economically feasible to have a $1,000-$3,000+ asset at a customer’s home if no or little fuel is used per year.
- Tank Maintenance. Second, the fees contribute to covering the cost of ongoing tank maintenance, ensuring your safety and the proper functioning of the equipment.
- Taxes & Insurance. Lastly, the fees help cover the property taxes and insurance Hall Propane pays for the equipment, regardless of whether fuel is used.
Avoiding A Minimum Use Fee:
There are several strategies you can employ to prevent a minimum use fee:
1. Expand Your Propane Appliance Usage:
Adding more propane appliances will increase your propane usage, reducing the likelihood of falling below the minimum usage requirements. Hall Propane offers various appliances, including log sets, tankless water heaters, space heaters, cooking appliances, dryers, and grill and generator hookups.Here’s a real-world example of how switching from a traditional to a tankless water heater helps:
- A family of four switches to a tankless water heater.
- The tankless water heater uses an average of .5-1 gallons of propane per day for showers, laundry, dishwashing, etc.
- Their annual propane usage for the tankless unit would be ~182.5-365 gallons.
- This helps them reach their minimum usage with the added benefit of being more efficient than electricity and providing continuous hot water.
- Read more about how switching to gas appliances from electric also lessens the load on the electrical grid and readies your home for a smaller generator.
2. Service Unused Appliances:
If you have an appliance that you no longer use, consider using it more to reduce your home’s overall energy consumption. It’s more efficient to heat part of your home than the whole home, especially in spring and fall. It makes more sense to spend money on fuel heating your home than the minimum use fee.
3. Purchase The Tank:
If you own the tank, you are exempt from minimum use fees. Plus, Hall offers a discount per gallon to all customers who own their tank. We are happy to provide you with tank and regulator prices.
*Tanks are much more expensive than you might think, that is the main reason for the fee. Tank prices have more than doubled in the last 5 years.
Once you purchase a tank, you’ll need to add it to your home’s tax value and homeowner’s insurance for liability and theft protection.
4. Consider A Smaller Tank:
We can help evaluate your propane usage patterns to determine if switching to a smaller tank is feasible. This option may help you consistently meet the minimum usage requirements and potentially avoid fees.
Remember: the price you pay per gallon of fuel may go up with a smaller tank because larger tanks receive bulk fuel discounts.
5. Monitor Your Tank Every Spring:
Check your propane tank in May or June to gauge the fuel level. If it is below 40%, contact us, and we can assess whether a delivery is necessary. By staying proactive, you can ensure your tank is adequately filled before the fee is applied.
Remember that filling the tank in summer reduces your gallon total applied toward the fee calculation in the next year.
Clients Choose Hall For Dependable & Experienced Service In NC & VA.
Your experience as a valued customer is important. By explaining the purpose behind these fees and offering solutions, Hall seeks to alleviate your frustration and ensure a positive customer relationship. Remember, our team is always available to assist you and find the best options for your propane needs. Here are some key points to remember:
- You are not charged for the fuel you did not use; the fee is solely for using the tank, regulators and other equipment when the minimum annual usage is not met.
- This fee may be adjusted annually based on rising costs, such as tank prices, maintenance expenses, property taxes, and insurance fees.
- In order to maintain transparency and openness in all our dealings, current fees are posted in our offices.
The experienced team at Hall is always here to address your concerns. Contact us today if you have any more questions about minimum use fees.