Our main fuel is LPG (Liquid Petroleum Gas), which is delivered to a large tank in the garden and from there it feeds the heating boiler and cooker. When we moved here we contacted the supplier whose name was on the tank. They sent us a contract which we signed without really paying it too much attention. Big mistake.
LPG was 4 times the cost of mains gas!
The bills were awful, about 4 times what we were paying for mains gas! In fairness we had moved from a modern insulated property to an old solid-stone wall house which is harder to heat and just before the coldest winter for a century struck, but even so, 4 times as much for a smaller property!
Save Money on LPG – Liquid Petroleum Gas
Now we’re a bit more knowledgable and so, to help those who like us find themselves on LPG with no options a few tips that could save you money.
You Have a Choice of LPG Supplier – Whoever Owns the Tank
When you move into a house with an LPG tank, you don’t have to buy your gas from the tank owner whose name is on the side. Yes they own the tank but if you change supplier they sell the tank to the new supplier. It doesn’t affect you at all.
You Can Change LPG Suppliers Every 2 Years
The contracts last for 2 years and you have a legal right to change supplier then, although they’ll sign you up for 2 years. If you don’t have a current contract and many people haven’t signed a new one for years, then you can change at any time.
Calor, Flogas and Avanti
There are three main suppliers; Calor, Flogas and Avanti. Spend a little time phoning them and get a quote from each. This will be in two parts; a price per litre of gas delivered plus a standing charge for the tank, around £60 pa for an aboveground tank. Both are subject to 5% VAT.
No Transparent Pricing on LPG
Calor, Flogas and Avanti do not have prices displayed on their web sites. There isn’t an open comparison website either so the only way to compare prices is to contact them individually.
Haggle for the Best Price on LPG
Start by telephoning them all and getting a price. You’re in the land of haggle, just like the market in Tangiers where they ‘make you good price’ by doubling it to start!
Now, when you have the best price, ring the other two suppliers and see what they can do about their quote. Take the new best quote back to the previous best priced supplier and see if they can beat it. You can go round as many times as you like.
Things to Check on the LPG Gas Supply Contract
- Your contract will be for two years
- Make sure the price per litre is fixed for twelve months and that the second year price is capped not to increase beyond a stated amount. Make no mistake, they will increase the price as far as they can in year 2.
- Check the tank rental charge – this can be daily, monthly or annual.
- Read the contract carefully before you sign and go back to them for clarification in writing of anything you are unsure of or unhappy with. Do not sign anything where they’ve left a box blank. In my experience they’re as slippery as eels. Once you’ve signed, they’ve got you, remember that market in Tangiers? No refunds.
How we Saved Over £1,000 on LPG
Now, here’s our experience. For one hour’s work we have saved £1,172.00 on the price we were paying over two years.
We use about 3,000 litres of LPG a year. Our gas was being supplied by company 1 at 42.5p per litre plus VAT. When the contract ran out they offered us £100 credit on the account to sign up again at the same price.
I picked up the phone and company 3 said we were far from a depot but they’d get back to us, which didn’t happen, so forget them.
Company 2 came back with 29.5p per litre plus VAT, capped at 3p increase in year two plus £250 credit for switching.
Back to company 1 who now could offer 29p per litre, plus £250 credit on the account and year two capped at 3p increase. Both companies were about the same on tank rental.
I then moaned about a few service issues we’d had and said it wasn’t enough to tempt me to stay. Now we’d just had a tankful delivered (1174 litres at 42.5p) and they offered to credit that down to the new price, giving me another £166 which is when I agreed.
Final LPG Fuel Savings Calculation – £1,172.00
So previous cost over 2 years would have been about 6,000 litres at 42.5p plus 5% VAT – £2,677.50
New cost will be 3,000 litres at 29p and 3,000 litres at 32p plus 5% VAT – £1921.50
Savings £756.00 plus £250.00 plus £166.00 gives a total of £1,172.00
I wonder how many people are paying more than they need to.
John Harrison 2016
Recently I was contacted by the Mail on Sunday who have published an article on this problem – you can read it here: Are you being held to ransom by suppliers over the price of LPG?