Why You Should Never Fall for a Cap-Price Heating Oil “Deal”

As the weather gets colder, Rhode Island residents’ need for home heating oil deliveries will increase steadily. There are a lot of promotions and deals being offered to local heating oil delivery customers—but we’re here to help you know which deals are worthwhile and which are scams. Particularly, we want to encourage you to avoid falling for the trap that a cap-price heating oil delivery plan provides.

What Is a Cap-Price Heating Oil Delivery Plan?

Many heating oil delivery providers offer heating oil payment plans, which may include a budget plan, prepay plan, or price cap plan. Some of these offers can truly be a good deal by dividing your heating oil payments throughout the year or paying in advance to earn preseason discounts. But a cap-price heating oil plan is really more hassle than it’s worth.

A cap-price plan requires that you pay an insurance price for every single gallon you order—and in exchange, the heating oil company will ensure that your price doesn’t rise above the predetermined cap that you choose. While this may seem like a good deal on the surface, there are three things that invalidate this so-called “discount:”

1. Your insurance price is charged on top of your price per gallon

If you pay 10¢ per gallon for insurance, that’s really like paying 10¢ more per gallon. So while your price per gallon may seem like a steal, you have to incorporate your insurance price into the cost of your home heating oil all season. That insurance price will never go away.

2. You choose your set-price per gallon, when lower rates may be available

Many companies offer you the “opportunity” to choose your cap price per gallon—but keep in mind that there may be providers who offer a much lower rate per gallon. Choosing your own cap may turn out to be more of a curse than a blessing.

3. You don’t always get the lower oil price if the market rate drops

Many times, your price-cap is the price you pay, even if the market rate drops. In 2020 especially, fuel oil prices are the lowest they’ve been in years, meaning that there’s a good chance that the market rate will drop below your cap price. Now since you’re stuck paying the insurance fee, you might not even be able to access the lower rate everyone else is getting.

The Bottom Line

The good heating oil delivery companies truly care about the security and satisfaction of their customers—but some of them offer deals that really are more beneficial for the business than the homeowner. Stick with Hope Energy if you want true, honest, customer-centric care that will always leave you with the best possible price for heating oil delivery in Rhode Island.