Understanding the Cost of Installing Above and Underground Propane Tanks

If you’ve chosen to use propane as a source of energy for heating, pool heater, cooking, or for a variety of other applications, you might be considering installing a propane tank. However, understanding the costs involved in installing a propane tank can be complex. There are two types of propane tanks – aboveground and underground – and both have their own set of costs and considerations. In this article, we’ll look at the costs of installing both types of tanks, explore the benefits and drawbacks of leasing versus buying a propane tank, and address frequently asked questions on the topic.

Aboveground Propane Tanks

Above Ground propane tanks are typically easier and cheaper to install than an underground propane tank. If you plan to purchase, the cost can range anywhere from $250 to $4,000 depending on the size of the tank. A small, 120-gallon tank (which might be used for supplemental heat or hot water) typically costs between $900 and $1,000, while a larger, 500-gallon tank (which might be used to heat a larger home) could cost between $2300 and $3,000.  You can also choose to lease a propane tank to avoid the large upfront cost.

The installation costs are less for above ground tanks because they don’t require excavation. However, they do need to be installed on a solid, non-flammable base, usually made of concrete or plastic.

Underground Propane Tanks

Underground propane tanks offer a more aesthetic solution for homeowners as they can be hidden beneath the landscape. However, this comes at a cost. The tank itself usually costs between $2,500 and $4,500, but the installation process, which includes excavation, can add another $1,000 to $3,000 to the total.

Other costs associated with installing an underground propane tank include acquiring permits if applicable and restoring the landscape after installation.

Leasing vs Buying an Above Ground Propane Tank

Leasing

Many propane suppliers offer the option to lease an above ground propane tank. This can be an attractive option as the initial costs are much lower than buying. Leasing often comes with a nominal setup fee, but the cost of the tank is included in your regular propane delivery payments or an annual fee if the tank is for low use appliances.

When you lease a propane tank, the supplier will typically take care of maintenance and repairs, reducing the worry about unexpected costs. However, you are tied to your supplier for your propane and may face restrictions on propane usage or minimum purchase requirements.

Buying

Buying a propane tank can be more expensive upfront but could save you money in the long run. Purchasing a tank allows you the freedom to shop around for propane and you won’t face any restrictions on usage. You’ll be responsible for maintenance and repair, but you have the option of hiring a professional service or learning to do it yourself to save money.

A new propane tank can cost anywhere from $250 to $4,000 for above ground and $2,500 to $4,500 for underground, not including installation. Over time, however, the savings on propane can offset these initial costs.

Frequently Asked Questions

1. How often do I need to replace my propane tank? Propane tanks can last a long time if properly maintained. ASME tanks, the most common type, can last 30 to 40 years. However, the actual lifespan will depend on factors such as the tank’s location, the weather, and how well it is maintained.

2. Can I install a propane tank myself? While it might be tempting to save money by installing a propane tank yourself, it’s not recommended. Propane tank installation involves strict safety regulations and should be carried out by a professional.

3. How much does it cost to fill a propane tank? The cost to fill a propane tank depends on the size of the tank and the current price of propane. The average cost of propane is around $2.50 to $3.50 per gallon, but prices can fluctuate depending on location and demand, as well as tank size.  As above ground tanks are generally smaller than underground propane tanks, the price per a gallon is usually higher and may also include the tank lease.

4. What are the safety considerations for propane tanks? Propane tanks need to be installed in a location where they can be easily accessed by delivery trucks but are not too close to the home or any ignition sources, like open flames or power lines. Both above and underground tanks should have a pressure relief valve. Underground tanks need an anti-corrosion system to prevent damage.

In conclusion, while the cost of installing a propane tank can vary widely depending on the size, type, and installation method, it’s essential to look beyond the initial cost. Consider factors such as maintenance, lifespan, propane price, and most importantly, the safety and regulations associated with propane tank installation. Consulting with a professional will ensure you make the best decision for your energy needs.

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