Jeff Adair: Strength in numbers pays for heating oil
Think of the town of Weston and what comes to mind? Those familiar with the eastern Massachusetts community of about 11,500 are bound to mention wealth.
Home to CEOs of major corporations and several sports and entertainment bigwigs, this town 17 miles west of Boston has the highest per capita household income in the Bay State, nearly tripling the statewide median.
That, however, doesn't mean everyone is on Easy Street. Behind the doors of many homes are some people who have no idea how they're going to afford this winter's heating bills.
Nationwide, heating oil prices, currently around $4.50 a gallon, is 36 percent higher than 2007 and more than double since 2005.
"In Weston, there are so many people who are retired on fixed incomes ... there's so many people over 80 living in their own houses," says Lee Marsh of the Lexington Street Neighborhood Association. "Some say, you should sell your house. Well, right now you can't afford to sell your house either."
Thanks to a local oil-buying group developed through the association, Weston residents may have a savior. A small one at least.
Since its founding in 2005 by Jan-Charles Fine, participants of the group have saved a "considerable" amount on heating oil compared to the retail price.
"It varies. Last April, it was 80 cents a gallon less than the retail price. Two years ago, we had a fixed priced and it was almost a dollar below," said Fine, an entrepreneur and former Peace Corps volunteer who has a history as a community organizer.
The group works like a co-op, but technically it's nothing more than a database. There's no organization. There's no legal structure. No money passes through Fine's hands. In fact, Fine has never met many of the members.
"I didn't want any liability," said Fine. "Everyone has to write their own contract with the supplier. No one is committed to do this."
Then how does it work?
Through e-mail, Fine collects names and telephone numbers, sets up a spreadsheet, and then sends out letters to oil companies seeking bids.
Fine said if an oil company can add four to five households a year they're doing well. With the group, even though there's no guarantee everyone will sign up, companies have the opportunity to add 45 customers, something that would normally take them a decade.
"Normally, we have a 95 to 98 percent retention rate," said Fine, noting that the companies also view it as a good deal since the bills must be paid in full upon receipt.
The group checks references, and after consulting with members, Fine makes a decision.
The group has not always gone with the lowest bid, since it requires full service.
"We have a lot of elderly," said Fine, and if a person were to experience problems with their burner overnight and have no service, "they could freeze to death."
In its first year, the group had about 25 members and this year Fine expects around 50 who will purchase around 70,000 gallons in total.
Fine has relied on word of mouth until this year. Wanting to help its constituents, this year the Weston Council on Aging put an announcement in the local weekly about the group.
Fine could, if he wanted to, expand the group beyond town borders but that would eat up too much of his time and create headaches.
His is not an original idea and this is something any neighborhood could do to save a few bucks on oil, instead of us waiting on Congress to do something about the high cost of crude. It's all about the strength, the leverage a group has, versus that of a single person.
Anyone with a little patience, and basic Internet and negotiation skills could do this, said Fine.
"I'd urge and encourage people in other towns to do this," he said. "It's very simple."
Jeff Adair is a Daily News editor and writer. He can be reached at firstname.lastname@example.org.