Propane tank basics

Propane is a liquefied petroleum gas (also called LP gas or LPG). A byproduct of natural gas processing and crude oil refining, it has many uses as a source of energy (indoor space heating, refrigeration, pool heating, cooking, etc.) and is popular in rural areas where homes are not connected to the natural gas pipelines network or in urban areas as an alternative energy to electricity.

One of the main advantages of propane is that it is stored in liquid form in a large tank directly on your property. As such, you are always in control of your energy and need only organize a delivery from a propane company if the level of propane in your tank gets too low. A delivery truck will come to your home and pump gas straight into your propane tank.

Cost

The average four-bedroom American house, if using propane as a primary source of energy, will require a 500-gallon propane tank. This type of tank will cost between $800 and $2,500 to buy and install if it is aboveground and between $1,800 and $3,000 if it is underground. Given the difference in price for the same size tank it is recommended to enquire with and get quotes from different tank manufacturing companies and propane dealers. Propane companies usually offer to lease you a propane tank at a cost of $75-250 per year depending on the propane tank size. Again, it is recommended to compare what different companies offer by requesting quotes with as much information as possible, from propane price, to maintenance options and tank lease.

Size

Propane tanks are designed to store propane at high pressures. They come in different sizes (100-1,500 gallons) and can be situated aboveground or underground depending on homeowner preference. The right size for your home will depend predominantly on how much propane you are likely to use, which in turn is affected by how cold your region is, how many occupants your home has, how many appliances in your home run on propane, etc. To figure out how much propane your home is likely to use, you can calculate your total appliance BTU load and corresponding number of gallons required: each appliance has a BTU rating per hour, which divided by 91,500 gives you the gallons of propane required to run the appliance for that amount of time. You could also get and compare quotes from propane companies: they are used to estimating residential propane usage.

Buy or rent

Choosing between buying or renting a propane tank requires some thought on the length of stay in the home: it is cheaper to rent a tank in the short term (companies require a three- to five-year commitment) but might be cheaper to buy one in the long term. Indeed, buying a tank enables you to fill it with propane from any company (so you can find the cheapest propane price) whereas renting a tank ties you to a propane company for the duration of your propane supply agreement. However, propane tank leases usually includes maintenance, servicing, repairs and customer care – which can take some of the hassle associated to managing your propane appliance system away.

Manufacturing and installation standards

Propane tank manufacturing is highly regulated in the United States. This is because propane is a safe but highly flammable gas and leaks must be avoided at all costs. Therefore, propane tanks are made according to ASME (American Society of Mechanical Engineers) rules, like many other high-pressure containers. Similarly, propane tank installation answers to strict federal and state laws and guidelines, including basic distance rules between propane tanks and the surroundings (house, windows, playgrounds, parking lots, etc.).

Safety

All this means is that propane is a very safe source of energy and propane tanks pose no particular threat. They are strong, they do not explode and they do not rupture. They are installed by qualified service technicians from the propane tank retailer or the propane company you have decided to use to prevent any type of accident from occurring, however small. The only potential threat with propane tanks is installing it yourself and making a mistake (increasing chances of a leak or fault), which is why this is strongly discouraged.