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:

  • It costs $2,500 or more to install a used 500-gallon propane tank with lines and regulators in your back yard
  • You might be better off leasing a tank from Caywood Propane and putting your $2,500 in the stock market for the long-haul.
  • Why?
    • The average customer needs to save $0.25/gallon to $0.35/gallon for 20 years to beat historical stock market performance.
    • Can't wait 20 years to get your money back? Well, then you need to save $0.47/gallon to $0.60/gallon to beat historical stock market performance in 10 years

So your choice is simple:

  • Put $2,500 in a stock market fund; or
  • Call around looking for a $0.25/gallon to $0.60/gallon savings every time you need a load of propane for the next 10 to 20 years.

We aren't aware of any price differences this big -- and we have looked pretty hard!

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

Turns out there are four:

  1. 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.
  2. 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 rent for that year.
  3. 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.
  4. You have to put your money in the stock market. Our example assumes you put $2,500 in an indexed stock fund tied to something like the S&P 500 and get an average return of 10% over a relatively long investment period (10 - 20 years). It also assumes that the S&P 500 continues to perform in the future like it has in the past, and there's no guarantee that will happen. Of course, it goes without saying that we are not investment experts, and we are not licensed to give anybody investment advice. If you're looking for investment advice you're on the wrong website. If you are looking for a basic illustration about why you might have options to put $2,500 in something besides more than 1,200 pounds of steel in your backyard, then you are in the right place.

Even with all of these catches, we believe leasing a tank is a great deal. And you'll save a lot of headache by not making phone calls every time you need propane.

Scroll to Top