Oil Co-op Proposal Results

  

To: ALL BONNET SHORES FIRE DISTRICT RESIDENTS

Date: August 6, 2008

Ref: Results of Proposal for Bonnet Oil Co-op

Due to a volatile oil environment, our group came together to explore the possibility of gaining some leverage with oil vendors by combining households in Bonnet to negotiate a better oil price. Although we don’t fit the true definition of a co-op, we were able to gather information for your use.

We contacted eleven (11) oil companies to see if there was interest in the venture. Out of the 11, seven (7) were interviewed based on their responses. Attached is a summary of those findings. Also included in this packet is a list of terms and typical usage per scenario for each program.

All information received will be posted on the Bonnet website and on CAP. All residents who graciously filled out our survey expressing interest in pursuing this "experiment," will be emailed a copy of the results or hand delivered for those without email addresses.

If you are interested in participating with any of these companies, please mention you are a Bonnet Shores resident and, if noted, refer to the corresponding code on the summary. If you choose to remain with your existing oil company, that is fine also.

PLEASE KEEP IN MIND WE ARE NOT MAKING RECOMMENDATIONS. NEITHER THE FIRE DISTRICT NOR WE ACCEPT ANY RESPONSIBILITY REGARDING YOUR DECISION. You will be signing an individual contract with your chosen oil company. **We hope that this information has been of service to you as one of our neighbors.

Questions? Contact Janice McClanaghan 783-8285; Miki Dickinson 789-2577; Dan Rigney 782-4545


TYPICAL USAGE CHART

EXAMPLE: 840 GALLONS USED PER YEAR TIMES (X) DIFFERENT PROGRAMS:


Variable:

Petro 840 x $4.04 = $3,393.60

White 840 x $4.03 = $3,385.20

Kent 840 x $3.93 = $3,301.20


Fixed:

Petro 840 x $4.399 = $3,695.16

White 840 x $4.449 =$3,737.16

*Not offered by others


CAP:

Petro 840 x $4.89 = $4,107.60

White 840 x $5.099 = $4,283.16

*Not offered by others

CAP With Fee:

White 840 x $4.949 = $4,157.16 + $99 fee = $4,256.16

 

      NOTE: ALL PRICES SUBJECT TO CHANGE. EXAMPLE ONLY!


OIL CO-OP Provider Matrix (8/6/2008)
See below for glossary of terms

Company Pricing Options Service Contracts Budget Offered Contract Season Additional Offers
Petro

Contact:
Bill Reilly or
Bob Colardo
736-2356

Mention Code:
Bonnet2725

 

3 Price Oil Plan
1. Variable 7/28 $4.04/gal

2. 1 yr. Fixed $4.399

3. CAP $4.89

Can change a variable to 
fixed at any point

*Prices discounted 
.10 for Co-op

 

Bonnet members receive 2 yrs for the price of one.

Value Program      Hot Air $99

Premium Program  Hot Water  $149 (includes zone valves)

 

Yes   
12 month smart pay or 30 day billing

Standard credit check

 

One year from sign up

One year from sign up

$100 worth of oil free

Free programmable thermostat

Upgrade boiler $200 credit

People can choose any option at any time as part of co-op

$50 to BSFD for each new customer brought in

If you have signed a contract already, you cannot change oil price. Perhaps can help w/service contract.

 

White Oil

Contact:
LuAnn Lambert
467-6510
 or cell
529-8317

 

4 Price Oil Plans

1. Variable: Tank Car plus $.45 fluctuates daily 7/28 $3.58 + $.45 =$4.03 

2. Fixed: $4.449 per gal thru 06/30/09 

3. CAP: $5.099 No higher, but can go lower if prices drop 

4. CAP: $4.949 with a $99 fee

 

$199 less $50 Group contract = $149

Zone Coverage add $12 /zone

Need to buy oil to get service contract

 

Yes 30 days or even monthly budget From day sign until 06/30/09 People can choose any option

Everyone will be included in program, including those who have already signed a contract with White.

 

Kent County Oil

Contact:
Steve Miller
738-8600

 

One Program: Variable .34 over rack This is a discount for Bonnet people. 
Ex.. 8/1 $3.59 +.34 = $3.93 He will lock in for one year at .34 for Bonnet people. 
Payment must be made within 30 days or price increases .10 per gal.
Yes, but subcontracted to Jerry Barlow. Steve assures reliable, 24/7 service. $189. for whole contract; $79. for cleaning only. 

Zone valves are extra . 
If you call for service after 4:30 pm, you pay more because employee gets time and half.
Yes, it is a 10 month plan starts in June. Will have to "catch up"

Payment must be made within 30 days or price increases .10 gal.

 

Oct.1 to April30 He doesn't require a set number of houses to get the discounted .34 gal. price.

May offer CAP and Fixed later. You would be able to move to it.

 

Koolco

Contact:
Greg Sweet
783-1500

 

1. CAP $4.90 individ. $4.80 for Bonnet

2. *4 Payment pre buy: $4.85 Nov/Dec/Jan/Feb 

3. *Prebuy $4.75

*May not offer 2&3

All prices will go lower if price goes down, but not higher

 

Yes

$260

 

Unsure if budget offered. 

Terms of payment Net 10 days. If past due, no oil delivery

12/01/08 - 03/01/09 (Before 12/01 will be daily price None
Reichert & Sons

Contact:
Bill Reichert Jr. 
568-2130 or 
647-5074

 

One program: .
40 gal. Over rack FOR GROUP OF 50 HOUSEHOLDS OR MORE . 
Must use automatic delivery and pay within 15 days to get price or must use a credit card if not paid with 15 days of delivery. Each delivery invoiced immediately.
Yes, but subcontracted to Trademark Heating located in N. Providence. 

Have been doing it for 10 years. Need to inspect every boiler before issuing a contract.

Yes, started in May. 

Will need your usage for last year so they can figure your monthly payments.

November 1 to March 31, 2009 He will accumulate names till group of 50 reached. If not reached, people will have to go to other companies.
Norm's  
(Div. Of  Santoro)

Contact:
Paul Hutchins
783-2084 or 
837-6976

 

Three Programs:
1. Fixed - 7/29 $4.459

2. Collar Program -Has Ceiling & Floor; therefore it can go
down. 7/29 Ceiling, $4.849 ; Floor $4.349. Usually .50 difference.

3. CAP Program - Ceiling w/unlimited downside. Ceiling $4.849 with $99 fee.

No margin over rack program.

Service Plans run for one full year.

1. Deluxe-$189/yr includes zone valve heads.

2. Supreme Plan
$219. Incl. some water parts.

3. Ultra $299 includes tankless water heaters
Extremely big on service (not at reduced rate)

Yes, for 10 months, usually start in July thru November to begin.

Net 30 days

 

From sign up till 5/31/09 $300 Penalty if break contract as with most companies. 

He considers groups a bigger risk therefore same prices as individual; no discount for group.

Other companies contacted:

Pier -789-9490 (Kevin) No price as of this date 8/4. Prices available in Sept.
SmithCo 789-2520 (Gordon Stuart) Information gathered, but SmithCo. Didn't want it published
Sunrise -783-7398 Not large enough to handle - wants guarantee of payments
Buckley - 789-9711 (Charlie) Contacted several times, showed initial interest. No proposal presented.
HEAT USA - 1-800-660-4328 (Anthony, Mgr. Outreach Dept.) Largest national oil co. No more openings in our area.


TERMS USED IN MATRIX

Variable/Tank car/or Margin over Rack (MOR):
This is the price that the dealer pays at the terminal plus a margin which is his profit. 
e.g. Tank car price of $4.00 plus margin of .40 =$4.40. 
The tank car price can fluctuate DAILY with market conditions.

Fixed Price: This option guarantees that your price will be fixed at this rate
Through the term of your contract. This price will not go higher nor
Will it follow the market down if the prices fall below the set fixed
Price.

CAP Price: This option guarantees that your price per gallon will not exceed
The ceiling price quoted, but if the market price is lower, you will get
The lower price.

CAP Price with Fee: This option guarantees that your price per gallon will
Not exceed the ceiling price quoted, but if the market price is lower,
You will get the lower price. The CAP set is generally lower per
Gallon with the $99 fee. ie., $4.949 instead of $5.099.