Information on Heating Oil Buying Networks.
Hundreds of thousands of homeowners across states in the northern part of the country, including Massachusetts, Pennsylvania, Ohio, Michigan, and New York, are able to join heating oil buying networks, groups and cooperatives. These individuals are saving significantly on their home heating bills and oil expenses. While the specifics will vary by program and network, on average homeowners will save anywhere from 10¢ to 30¢ per gallon on their heating oil. Some of the companies will also offer other discounts as well, such as when it comes to repairing your furnace, how water heater or other equipment. Below you will learn how heating oil buying networks work and how they can provide you with significant savings.
Heating oil negotiations and volume
These groups work by using the purchasing power of tens of thousands of member households across numerous counties and states. As homeowners sign up for the heating oil buying networks, they receive the benefit of increased volume discounts with dealers. But the homeowner does not need to negotiate the price themselves. The buying network will do this and they will negotiate significant discounts on home heating oil for their members. The easiest way to think about it may be that these buying networks are like a wholesale buying club for people across the nation who use heating oil to heat their homes or apartments. They have a similar business model to group buying clubs such as Costco or Sam’s Club in that these networks are able to buy a large quantity oil at reduced rates and then pass these savings on to their customers.
The heating oil dealers benefit as well and strongly support the networks. The reason being is that in exchange for a large volume of guaranteed, recurring business (customers), these dealers are able to significantly reduce their normal profit margins as they do not need to worry about, or incur the expense, of selling to one customer at a time.
Who supplies the heating oil?
The organizations will enter into agreements with various dealers across their service areas. While the exact terms of each program and buying network will vary, in most cases you will have access to a highly qualified, full-service heating oil dealer / supplier. They will usually offer numerous services to customers including such benefits as 30-day net payment terms, emergency service, budget billing, available service contracts at reasonable rates, system repairs at reduced costs, and more.
When you join a certain group, your OBN (Oil Buying Network) representative will help you determine which company in the network is best suited for your needs.
Other benefits of the heating oil buying networks
In addition to your oil savings, you will also receive a free comprehensive service contract that includes extensive parts and labor coverage for your heating system, 24-hour emergency service, and a free annual cleaning and tune-up of your heating system. While not quite as common, some companies will also be able to repair your furnace or system and offer discounts for that service as well. Members receive an extensive array of benefits from these groups.
Quality of service provided
It is usually higher when you join these groups. Heating oil networks and cooperatives usually have their customers sign up year after year, and have renewal rates in the mid to high 90% range. This means that most people feel that they benefit from the high quality of service and savings, and they renew their contacts and sign up every year. Not only do customers save a significant amount of money, but most members of the heating oil buying groups report that their quality of service is higher after signing up for the group than it was with their previous supplier. They receivebenefits that they would not normally get when they bought their oil on their own.
Cost to join heating oil buying groups
While of course the prices will vary based upon where you live and the terms of your deal, on average it can cost as little as $20-$40 per year to sign up for one of these heating oil buying networks. But the amount you save on your heating oil, and other benefits such as improved customer service, reduced prices on heating equipment replacement and repairs, and other discounts more than offset the initial fee. The initial fee can be very reasonable when considering the other benefits that members receive.
Some cooperatives may also offer additional savings to low income families, senior citizens, or the disabled. If this is available, it will normally be offered on the initial enrollment fee. When contacting a network, be sure to ask if there are any other discounts available.
If you do not think you can afford the cost, you can check to see if your are eligible for a program that offers free heating oil. Click here to read more.
Companies that offer discounts and how to sign up
There are numerous home heating oil buying groups and networks in Michigan, Ohio, New York, Massachusetts, and throughout the nation. Some of the bigger organizations include Oil Buying Network and HEAT USA. Be sure to review the terms of each of these organizations to determine which may benefit you the most.
Regional and National Co-Operatives
Heat USA is a national heating oil cooperative. Repairs, oil, tune ups, and more is available.
Pilgrim Oil Group - Offers discounts on heating oil.
Co-op Power - New England sustainable energy cooperative
Citizen's Oil Co-op - Can offer both bioheat and oil. Dial (860) 561-6011.
Mass Energy - Heating oil, tune ups, and other discounts. Households may save a few hundred dollars per year on their heating oil. 1-800-287-3950.
Pioneer Valley Oil Cooperative - Sells fuel oil.
LS Fuel Co-Op - Will have oil, propane, gas, and more.
North Country Fuel Association is another cooperative that has both heating oil and propane for customers.
The non-profit New Jersey Citizen Action Oil Group can help families save 10 to 20% on their heating bills. Call 1-800-464-8465.
Citizen Action Fuel Group - Kerosene and heating oil. Phone 1.800.559.4645.
Energy Cooperative of New York - May offer consumers with natural gas and electricity.
Galway Co-Op - Propane.
NYPIRG Fuel Buyers Group - New York families can receive fuel oil and natural gas discounts.
Washingtonville Fuel Corporation
The Energy Cooperative - Operates across the state. Customers can receive heating oil, bioheat, propane, and also renewable electricity. Telephone - 215.413.2122.
Energy Co-Op of Vermont - Heating oil, propane, and kerosene is available.
North Eastern Vermont Fuel Cooperative is leading network in the state.