The price per gallon for fuel purchased under this program is determined by the price we pay for it. The program is offered at a time of the year in which factors such as demand and inventory levels have a downward effect on prices. These prices are then passed along to you at a time of the year where demand and inventory levels typically have an upward effect on prices.
When we sell the heating oil to you, we enter into supply contracts with our suppliers for that product. We must take delivery on all of the product we contract for. If we do not, we must pay for it anyway. On our plan, you don’t lose the money for the excess gallons. It is kept on your account and can be used for future purchases such as the pre-purchase plan for the next year.
We only pre-purchase a certain amount of fuel for this program in advance because we don’t want to purchase too much. Once this amount is sold, we must then go back to the market and buy additional gallons. We pay whatever price the market is then trading at. This price is usually higher because it is closer to the winter months where demand plays a bigger role in determining price.
Simply put, automatic delivery is the most efficient way for us to deliver oil. Scheduling, routing, dispatching and the actual delivery of the product are all made more efficient and thus reduces our costs, which allows us to offer the plan at the price we do.
We are only able to pre-purchase product so many months in advance. Remember, we have to pre-purchase the fuel so that we can sell it to you at the price established. Those purchases are made on a month by month basis. If you use all of your prepay prior to expiration, that's fine. If not, we don't have purchases made beyond that to cover the sale. Upon expiration each year, we settle the books. We zero out any remaining gallons and the new plan starts, based upon purchases we were able to make for the upcoming season. Please see the contract terms for more information as terms may change from year to year.
The minimum delivery is 150 gallons.
Yes there may be. If we are not in your area on the day you need a delivery we would typically charge you for that trip. That charge is currently $25.00 however that is subject to change. If you need a delivery after normal working hours a charge of $89.00 will be made for the trip and another charge of $25.00 would be made if we need to start the heating system. By becoming an automatic delivery customer, you never need to worry about running low or paying these fees. We would make the delivery based upon the weather.
We deliver to the Lehigh Valley and surrounding areas.
The CAP fee is only charged if you are on the BetterWay plan and have a CAP in place. The CAP means that we guarantee you a MAXIMUM price that you would be charged for delivery during the course of the year. Simply put, your price can go down with the market but will never go higher than your CAP price. We only pass along the costs associated with purchasing these market hedges, similar to insurance.