Minimum Usage Requirements | Propane Collective

Minimum Usage Requirements

for leased tanks only

Like many suppliers, InterState requires that customers with leased tanks use a certain amount of propane per year. Minimum usage requirements help to ensure InterState doesn't lose money on the highly discounted terms it has extended our Members.

Usage Requirements

Leased tanks under 494 gallons need to use a minimum of 300 gallons per calendar year.
Leased tanks 494 gallons and over need to use a minimum of 500 gallons per calendar year.
Minimum usage requirements begin with your first full calendar year of usage, i.e.
if you become a member in 2024, the requirement will begin 1/1/2025.
If minimum use levels are not met, customers will be charged their margin rate multiplied by the number of gallons needed to meet the minimum usage requirement. Maximum fee of $150.

EXAMPLE: A residential routed customer leasing a 250-gallon tank using 200 gallons in a given calendar year would be charged as follows:

Example of Minimum Usage Fee Calculation:

Usage requirement:

Subtract actual usage:

Equals Shortfall:

Multiply by Margin:

Total minimum usage fee:

300 gallons
- 250 gallons

= 50 gallons

x .89

= $44.50 fee for calendar year.

Why is there a minimum usage requirement?

Propane tanks are expensive pieces of capital equipment, costing several thousand dollars each. A certain amount of revenue per tank must be generated each year to offset suppliers' investments in this equipment.

Is the usage requirement only for leased tanks?

Minimum usage requirements only apply to leased tanks, they do NOT apply to customer owned tanks.

I use less than 300 gallons per year; should I join the Collective?

If you lease your tank and use less than 200 gallons per year, membership in the Collective most likely won't make sense for you.
If you lease your tank and use between 200 and 300 gallons per year, membership in the Collective likely will save you money. You'll need to compare the total cost with what other suppliers charge. Most suppliers have a minimum usage requirement. If they don't, they'll likely be making that cost up in the price you pay for propane.

What other options do low users have?

The best bet for those with very low usage is to purchase a tank. InterState may be able to assist with that. There are other local outfits that sell used and new tanks. Be sure you know the quality of what you're buying.