Heating Oil Basics → Delivered vs. Retail Propane
There are two ways to buy propane: delivered to your home by a local supplier, or retail exchange and refill at stores like Tractor Supply, Home Depot, or gas stations. Most people assume retail is cheaper because the upfront cost per tank looks low. They're wrong — and the math isn't close.
This guide breaks down the real per-gallon cost of each option so you can make an informed decision for your home.
Delivered propane from a local supplier typically costs $1.80–$3.00 per gallon, depending on your region and the time of year. Retail propane through a 20-lb tank exchange at a store works out to $3.50–$5.00 per gallon equivalent.
| Method | Typical Cost/Gallon | 100-Gallon Season |
|---|---|---|
| Delivered propane | $1.80–$3.00 | $180–$300 |
| Retail exchange (20-lb) | $3.50–$5.00 | $350–$500 |
That's 30–50% more expensive for retail. The gap widens as your usage grows.
The sticker price on a retail tank exchange understates the true cost. A standard 20-lb propane tank holds approximately 4.7 gallons — but exchange programs at most stores only fill tanks to 15 lbs (~3.5 gallons) to reduce liability. You're paying for a full tank and getting 75% of it.
On top of that, each trip to the store costs gas and time. Home heating requires hundreds of gallons per season — that's dozens of tank swaps, each requiring a separate trip. Add it up and the convenience premium disappears fast.
Retail propane exchange makes sense for BBQ grills, camping equipment, and occasional outdoor cooking. If you use less than roughly 50 gallons per year, the convenience of grabbing a tank at the hardware store wins over the hassle of scheduling a delivery.
But once you cross 50 gallons annually, the cost math shifts decisively toward delivered propane.
Delivered propane is the clear winner for home heating, hot water, pool heating, and whole-house generators — anything where you're using more than 100 gallons per year. The per-gallon savings compound quickly at volume, and you're not making trips to the store every week.
A 500-gallon home heating tank will last most households through a heating season. One or two deliveries per year, and you're done.
One common misconception about delivered propane: you don't need to own a tank. Most propane delivery companies offer free or low-cost tank rental ($50–$150 per year). Many include it as part of a service or delivery agreement. The supplier installs and maintains the tank; you just pay for propane.
This removes the main upfront barrier to switching from retail to delivered propane for home use.
Track your propane deliveries in the HomeHeat app
Monitor costs, predict run-out dates, and compare suppliers — free, no hardware required.
Yes, for most home uses. Delivered propane averages $1.80–$3.00 per gallon while retail exchange works out to $3.50–$5.00 per gallon equivalent. The break-even is around 50 gallons per year — below that, retail's convenience can justify the premium. Above that, delivery is almost always cheaper.
A standard 20-lb propane tank holds approximately 4.7 gallons when full. However, most retail exchange programs (Blue Rhino, AmeriGas at stores) only fill to 15 lbs — about 3.5 gallons — to reduce liability. You're paying for a 20-lb exchange and getting a 15-lb fill.
No. Most local propane suppliers offer tank rental as part of their service, typically $50–$150 per year or included with a delivery agreement. The supplier owns and maintains the tank; you pay only for propane. Ask about tank rental when you call for a first delivery quote.
Yes, and the switch is straightforward. Contact a local propane supplier, they'll assess your home's needs and install an appropriate tank (typically 120–500 gallons for residential use). Most offer same-week installation if you have an urgent need.