Bulk LPG - Cheapest suppliers / supply route?

HateLPG

johntb wrote: »

have any one ever only had their tank filled in the winter to the halfway as this dont make any sence to us we had lpg for over 15yrs and have never only been topped up to half a tank

The short answer, is yes!

Certainly, after the supply problems of the past couple of winters, different companies have adopted different strategies to reduce the risk of customers running dry in the event of unexpected bad weather. One company (Shell, if memory serves) actually put out a release to the effect that if a tanker was in an area, and other customers could benefit from a partial top-up, then this is exactly what they would do (i.e. they would try to maintain customers at non-critical levels).

Put another way, they could top you up fully and leave another customer in your area at risk of running dry if the weather turns bad, or they can give you a bit each and know that you will both have continuity of supply for the next several weeks.

LittleVermin

HateLPG wrote: »

The short answer, is yes!

Certainly, after the supply problems of the past couple of winters, different companies have adopted different strategies to reduce the risk of customers running dry in the event of unexpected bad weather. One company (Shell, if memory serves) actually put out a release to the effect that if a tanker was in an area, and other customers could benefit from a partial top-up, then this is exactly what they would do (i.e. they would try to maintain customers at non-critical levels).

Put another way, they could top you up fully and leave another customer in your area at risk of running dry if the weather turns bad, or they can give you a bit each and know that you will both have continuity of supply for the next several weeks.

A couple of winters ago, with national supply problems and icy roads, BP was going round giving everyone a squirt (their policy otherwise was only to fill to the max, i.e. 85%, even if someone only asked for 50% for whatever reason*).

And if you really do run dry some companies will arrange for a cylinder to be emptied into your bulk tank - but this can ONLY be done if your tank really is dry rather than still with 1-2% or more. {Info from Extra Fuel, my independent supplier .. signed up to after I declined to pay BP's extortionate prices any more.}.

*Footnote - so how do I know BP would only fill to the max (earlier contracts they'd sent, but I hadn't signed, said 50% was minimum fill)? I asked for a 50% fill to tide me over until I could be sure I had a new contract with another supplier (Extra Fuel). No, BP said, total fill or nothing - so nothing it was, extra woolly jerseys ... and Extra Fuel very kindly got me filled (from 0%!) as soon as they'd got the switch back from BP, and before I'd signed a contract. BTW BP were charging me 53.95ppl, offered me an initial price of 42.45ppl fixed for 3 months on a 2 yr contract (I was well out of contract) ... while Extra Fuel's price that month (May 2010) was 36.29ppl! Check Extra Fuel's prices against ANSI (Argus North Sea Propane) for the last 2 years here (thanks to HateLPG for the graph).

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Ace_gas_guzzler

Although I've been a bit critical of Countrywide, there are little chinks that shine through sometimes! Last Christmas we were getting very low on LPG so I phoned them to check that we were on their delivery schedule. I was told that I was due to get a delivery by the start of the following week. Nothing arrived and with the snow on the ground and three sons coming back for Christmas, along with two babies, we had to make sure that we had enough LPG. But, no delivery appeared and the tank went to zero. A couple of days later, a little red van appeared with two large propane cylinders which they then decanted into my underground tank. Apparently, a number of bulk carriers from the continent had failed to get through and there wasn't enough gas to go round. They were actually filling up their cylinders from a petrol station near B'ham Airport where the LPG supply had been shut off for motorists but was available for the red van men.
I suppose someone now is going to tell me that I was spun a line and there's no way they could have done that! Oh well, I suppose you've got to be a sucker to use LPG in the first place!
It would be very useful if contributors could give a timescale to the prices they are being offered by the various companies - it would be very relevant in the negotiations with the suppliers when seeking new contracts. Some great help appearing though, so, thanks everyone!

Seraphinaoflondon

Has anyone looked at wood pellets as an alternative? I guess this is the wrong thread, is there one on pellets here on moneysavingexpert? Pellets are made in the UK and around 1/4 the price of LPG.

LittleVermin

Here's Extra Fuel's price for the last 24 months, against ANSI (Argus North Sea Index, for propane). I hope this may help people in their negotiations.



Extra Fuel is an independent based in Manchester but they also supply people beyond the range of their tankers from their depot by subcontracting. So, for example, I had a fill - at Extra Fuel's price of 50.25ppl - down here in Cornwall this morning by Flogas. In other areas they use other suppliers (often independents, I believe). Anyway, Flogas must be content to get some fraction of the price Extra Fuel charge - and when I got my first Flogas delivery almost 2 years ago the driver said he was getting a large number of deliveries to make for Extra Fuel - so who were they? Apparently, at the beginning of each month Extra Fuel phone the 3-4 suppliers they use (e.g. Conoco, ..) for a price for that month - and then post the price Extra Fuel will charge on their website. If the price they have to pay increases appreciably they have had to increase their price mid-month - and one month the wholesale price dropped appreciably so they dropped theirs. But there's only one price per month on the chart, for simplicity, and that's the price I jotted down.

Apologies - I added the above para earlier - but somehow it never ended up posted on the forum. Clicked the wrong button? Is that possible?

BTW, the LPG suppliers use Platts NWE (North West Europe) rather than ANSI, I believe, but a subscription to Platts costs over a thousand a year - and people post info for free on MSE!

Again, thanks to HateLPG for the graph.
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Seraphinaoflondon

LittleVermin wrote: »

Here's Extra Fuel's price for the last 24 months, against ANSI (Argus North Sea Index, for propane). I hope this may help people in their negotiations.

The shape of the charts is very similar, could the difference between them be delivery, retail margin and VAT albeit at reduced rate? Delivery isn't going to be insignificant -- the cost of the tanker and driver, fuel, liability insurance to cover the risk of damage to customer's property. The cost of marketing and handling of very small accounts must also be significant, plus charges for CCs etc.

HateLPG

Seraphinaoflondon wrote: »

The shape of the charts is very similar, could the difference between them be delivery, retail margin and VAT albeit at reduced rate? Delivery isn't going to be insignificant -- the cost of the tanker and driver, fuel, liability insurance to cover the risk of damage to customer's property. The cost of marketing and handling of very small accounts must also be significant, plus charges for CCs etc.

This is an example of how things probably should be!

Extra Fuel are a very non-typical supplier in that they don't have a fixed "contract price", but instead publish a "monthly" price on their website and that is the price you pay when you phone to place an order. This model is still open to abuse, but in the case of Extra Fuel, their price does, by and large, seem to refelct the wholesale price pretty well.

On the down side, it does mean that if the wholesale price shoots up, you get a nasty surprise when you next have to place an order, but on the (very big) plus side, it does mean that if the wholesale price falls, so does the price of your LPG. To my knowledge, Extra Fuel are the only company that passes on falls in the commodity price as and when they happen. And it is nothing if not a fair pricing model!

There is a caveat here. The Extra Fuel price generally seems to be a fair upper mid-market price for the "low" or "average" user (less than about 3,000 litres per year or so). Higher users will generally find that they will be able to get a far better contract price with a more typical supplier who offer a good introductory price and contractual protection against unwarranted price increases (which, as has been discussed on this thread at length, excepts one of the major suppliers, Flogas). For example, I typically use just over 5,000 litres a year (no grain dryers here, but still "eeek!") and my price has only just gone up from 41.5ppl to 43.5ppl in the past month. Extra Fuel simply couldn't come close to that price (their February 2012 price is 50.25ppl)

LittleVermin

HateLPG wrote: »

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a more typical supplier who offer a good introductory price and contractual protection against unwarranted price increases

<snip>

A short exam!

Q1. "contractual protection against unwarranted price increases" - discuss.

Answer: ....the bulk of bulk LPG users have NO way of knowing what is "unwarranted". The 'market' is so opaque that all sorts of tosh is produced as 'evidence' for the necessity for price rises. The "contractual protection" is, I believe, no such thing.

A very small percentage of bulk LPG users read this thread and have seen 1) the historic wholesale LPG price against Brent crude, in $/tonne, published in the recent OFT report (see here) and 2) the monthly ANSI price which now appears, converted to ppl (see here and here).

Info on this thread may have been useful in getting reductions in Countrywide's recent price hike for several readers, but elsewhere out in the sticks (i.e. off-grid) there must be fields full of cash-cows being fleeced by Countrywide Farmers (yes, part of Countrywide Farmers's business model seems to be to farm unsuspecting domestic LPG users ... so long as they don't run a grain dryer!).

Of course, Countrywide is not alone.

The maximum rate of rise in some contracts does allow you to calculate the maximum price you may be paying at the end of your 2 yr contract (and gives you an escape clause if the rise is in excess of the contractual term) so this is useful (so long as you are not then hit for an uplift charge if you want to excercise your escape clause!).

The gist of this was sent to the OFT as part of at least two submissions to the Office for Fair Trading Off-grid Energy Study. Comments to Sharon Dias at OFT* that suppliers need to justify price rises with reference to publicly available data would not go amiss! We'd have to leave it to OFT and UKLPG how they managed this.

* quote from email to me last November
Markets Policy and Remedies team by e-mailing [URL="blocked::mailto:sharon.dias&#64;oft.gsi.gov.uk"]sharon.dias@oft.gsi.gov.uk[/URL]. The OFT is also, as noted in our study report, engaging with suppliers to seek, where necessary, improvement in the clarity of contract terms, particularly concerning cancellation and switching rights. [FONT=&quot]
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*****

There are some local independents which have appreciably lower prices than Extra Fuel - e.g. Cardiff Gas which is currently charging 46ppl, and offering a lower price if you own your own tank (see here) - if you live in their part of South Wales. Some posters have reported some very good local deals from suppliers who don't post prices - but you can count these on the fingers of one hand.

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Ace_gas_guzzler

I've just sent an email to Sharon Dias of the OFT asking her to look into the costs and contracts involved in being supplied with LPG. I informed her that my LPG price per litre has increased by nigh on 80% from May 2010 to end of February 2012. I'd never worked out the percentage increase before..........

I'll let you all know her response.

HateLPG

Ace_gas_guzzler wrote: »

I've just sent an email to Sharon Dias of the OFT asking her to look into the costs and contracts involved in being supplied with LPG.
<snip>

I'll let you all know her response.

Top Man, Ace :-)

Looking forward to hearing her reply!