Leasing a Tank is Cheaper Than Owning a Tank!

Contrary to popular belief, it's cheaper to lease a tank than it is to own a tank, even if you pay more for the propane and even if you pay a termination fee when you no longer use the tank.

Consider this:

  • You have $1,000
  • You have two investment choices:
    • Install a tank that you own; or
    • Lease a tank from Caywood Propane and invest the $1,000 in an IRA that is invested in the stock market earning typical annual returns.
  • You use 750 gallons a year.
    • If you lease a tank from us, you pay $0.25/gallon more than if you own your tank
    • If you own your tank, you invest the $0.25/gallon savings (that's $187.50 per year) in an IRA that is invested in the stock market earning typical annual returns.

Under these circumstances, it will take you 29 years to save money by owning your tank - eve after paying our current $225 termination fee! If you use less than 705 gallons a year, you will NEVER save money by owning your tank.

This simple example also ignores the value of the complementary Price Protection you get with our leased tanks (minimum value of $50/year), the value of the tank monitor we place on the tank (minimum value $50/year) or the cost of maintaining or repairing a tank - or moving it should you happen to move some time in the next 29 years.

Sounds great, so you might ask, "What's the catch?"

Turns out there are four:

  • You have to buy your propane from us. In fact, it's against the law for anybody else to put gas in our tank, or for you to let them do it.
  • You often pay more for the propane. in our example, it's $0.25/gallon.
  • You have to take delivery of at least 500 gallons per year. If you don't meet the minimum purchase for a year we are going to charge you $100 rent for that year.
  • There's a termination fee. This fee currently is $225, but is subject to change. It doesn't matter how or why the termination occurs. The only exception is if another customer approved by us takes over your lease.

Even with all of these catches, leasing a tank is a great deal.