Anyone use a "co-op" for oil or other home heating commodity?

[cnice_37]

When I bought our house 5 years ago I was young and green and blindly signed a contract with the highest priced oil delivery company around. I'm finally out of that contract and was planning on just buying based on price when the need arises.

I came across the Mass Energy Alliance or something like that co-op. Basically a non-profit that pools consumer cash to bring down the price of heating oil. They claim to save on average 15-40 cents a gallon. Not sure how an average has such a swing, but nonetheless I am trying to find out more. It appears to be $20 for a year membership and there are other services offered as well like burner cleaning which I need to get done.

I haven't seen any user reviews on the net, so figured I might ask the home heating gurus on AS. We do use a good $1000+ on oil each year based on hot water needs and those cold nights when the heat kicks on at 4AM.

I've seen these (co-ops) are in other places in the Northeast.... so any feedback?

Thanks,
Craig

 

[Circle B MN]

While wood heat is perhaps your best heating solution, have you considered switching from fuel oil to natural gas...?I would think the savings could be significant.

 

[Misfit138]

When I lived in Texas, I had Farmer's Electric Cooperative, and the savings were really great. I like the idea of a cooperative, and if there were a viable coop where I live now, I would sign up.
So, yes, I had nothing but positive experiences with my coop.

 

[Dalmatian90]

Not a big propane area out here, and natural gas is comparatively less used then other sections of the country due to patterns of development -- it's not economical when you have large areas zoned 1/2, 1, and 2 acre housing lots. Off the top of my head, I'm figuring 30,000 of my county's 135,000 have access to natural gas. It's also a bit more expensive then much of the country since we sit at the end of the pipelines and they can't meet the demand in winter (a favorite trick of electric companies is to build a natural gas plant, and once it's finished come back and add in oil as a back up for use in winter when they can't get enough gas). The PA/NY gas fields will hopefully change that situation in the near future.

Looking at the Mass Energy Alliance's site, the one thing that concerns me is they state their contracts are for a fixed profit above the wholesale price of oil. That part is fine, but what I'd want to carefully compare it to is fixed and capped price contracts with a local dealer -- I'd ask MEA for their take on it too. Fixed price is fixed price; capped price floats with the wholesale up to a certain point. Those usually require you to agree to buy a certain amount of oil and/or pre-pay. If the price of oil spikes during the winter, the capped price may be a better deal then wholesale + fixed profit.

Co-operatives are one of those things that sound great in theory and have a lousy track record in practice in the U.S. Relatively few have survived compared to how many have been started. They usually suffer from one of two extremes -- you get a big disconnect between management and the members, so that management spends like it's other's people's money, and the members don't care. That was the fate of Agway, which had a very big energy business in addition to it's agricultural stuff. A bunch of others suffered from the exact opposite -- too much democracy, and the membership wanted to be so involved with every decision the organization couldn't just make a decision and run with it. That's why similar sized private businesses, with an actual owner whose watching his own money, usually eat the co-ops lunch.

MEA doesn't sound like a traditional co-operative -- which would buy the oil itself, have it's own trucks to deliver, it's own finance department, etc. It's run more as a buying club and it's been around for a while, so I think you can trust it in that respect. You just have to figure out if the local guys can cut you a better a deal with some of the pre-season contracts they offer.

 

[2OLD4THIS]

Oil Co-Op

I belong to a co-op here in CT. The prices are usually around the same or couple cents higher than COD prices. The co-op sets you up with a local company, mine happens to be one of the largest in the area. All the burner services are available just like a full price paying customer, emergency services too. My only complaint is they bill me online and it ends up in my spam folder, so I don't see the bill immediatly and after five days they start hounding me to pay.

 

[Dalmatian90]

I had Farmer's Electric Cooperative,

I wasn't thinking of Rural Electric Co-operatives when I wrote my comments above, but they're organized a bit differently -- first, under the Federal rural electric co-operative legislation put in place during the New Deal (they're regulated by the Rural Utilities Service under USDA), and second that they have monopolies in the area they serve so they're not under much competitive pressure.

There's some really well run ones, but I've also read of a few that seem to be largely financing vehicles for sending the Board of Directors on a Hawaiian vacation each February to discuss board business. Again, comes down to the members being involved enough to keep the Directors & Management in check, without being so involved as to tie them up in knots.

You can find a map of where they are here -- basically most of rural america...though realize while the vast majority of area is RECs, they only serve 11% of the population v. 74% served by investor-owned utilities:
http://www.nreca.org/members/Maps/PublishingImages/FullSizeCoopServiceTerritoryMap.gif

Looking at the map, VT & ME have cooperatives too but New Hampshire is the only one I'm somewhat familiar with. New Hampshire might be unique in the nation -- they never established territories or franchises back in the day. Electricity was a free for all and quite literally whoever strung power lines first on a street got to serve that street. There's a few towns in New Hampshire that to this day have three different electric companies, two private and one co-operative, serving the town since they all raced in from different directions to see who would build a line to the lucrative center of town first.

 

[Coldfront]

We were getting propane from a local co-op but I found I can get it cheaper from another propane Co. I don't really care much for our co-op they have screwed me before on service work as well.

 

[jcl]

i joined energy alliance in NH saved $ .90 cents a gallon on propane last couple years i only used 400 gallons a year. the more you use the higher the discount. They also have discounts on heating oil,K1 and diesel the best $25 dollars I've spent

 

[Coldfront]

So how much are you paying for propane? Saving 90 cents per gallon? I'm at $1.96 right now with local propane Co.

 

[cnice_37]

Well, based on the prices they quote for "average" in my area, I elected to forego the alliance and found a better deal elsewhere.

However, this may be good information for someone else, so thank you all that replied.

The bad news is that I need to fill up about 200 gallons but not so bad @ 3.29/gal plus $50 for first time customer. Their daily price was also the best in the 'hood so with no commitment (lose the $50 if I don't stick it out a year) seems decent.

Also - no natural gas piped in around here. Small town, well water, oil tanks. It is what it is.

 

[jcl]

So how much are you paying for propane? Saving 90 cents per gallon? I'm at $1.96 right now with local propane Co.

Here the local company's adjust the $$ amount on how much you use. Me 400 gals for hot water / dryer & heat when wood stove runs out so last year it was $3.60 a gal I got .90 cents off guy across the street uses over 1000 gals ayear got $1.50 off a gal it only here in southern nh any little savings is my in my pocket!