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What You Need to Know About Your Home's Oil Tank

Your Realtor just showed you a few homes and the one you LOVE has an oil tank, but the thought of oil heat makes you worry about the unknowns. Or maybe you are trying to sell your home and for some reason the home oil tank is making your home hard to sell.

Home Oil Heating Tank

If you’re a buyer, take the time to learn about the tank on the property. It is ideal to educate yourself prior to writing an offer, but certainly before your inspection period is over. If you’re the seller, reassure the buyer and reveal all you know about your oil tank so that their concerns are diffused and no surprises or unknown issues arise during your transaction. Either way, it’s important to familiarize yourself with your heating needs in regards to oil heat and specifically, the oil tank.

Know Your Tank

Oil Tanks have not always been regulated, monitored or even had any type of enforcement at all. And they have been installed in various ways over time. In fact, most homes built prior to 1960 still use, or at one point, have used oil heat.

Know what type of tank you have and where it is located.

  • Do you have an inside or outside tank? If it’s inside you may have a plastic tank, but if the tank is located outside, you most likely have a steel tank. Newer tanks are made of composite, stainless steel and fiberglass. Some tanks are actually bundled where there is a small tank inside of a larger tank for even more safety.
  • Where is your tank installed? It could have been installed easily next to the home, in the crawl space or even buried underground. At one point it was the trend to bury the tank because it can be quite an eyesore to install it above ground. However, this has caused problems with monitoring and maintaining the tank regularly, as well as environmental issues with possible leaking. The current thinking on the best place to install your oil tank is inside, in the basement on a concrete floor for ideal stability. It’s easier to monitor here and protected from the elements of nature. If you do not readily see the tank, walk around the home and look for pipes poking up out of the ground. If you see old copper lines, know there probably is or was at one time an oil tank installed below ground. Prior to settlement, ask your inspector to locate the oil tank and note it on the inspection report if there is one.
  • How much oil does your tank hold? Once you have located the tank, find the gauges, filter and shut off valves. Know your consumption rate and how much supply is needed in order to make sure you have the right size tank for your situation. It is important to always know how much oil you need to purchase and how much is left so that you never run out. Know how to check the tank levels in case the gauge quits working (with a stick). You do this by having the tanks measurements and following the chart below. Notice the H (means tall) and V (means wide) on some tank sizes. Check the levels regularly to prevent your tank from running empty. Keep in mind that it could take a couple of days or weeks to get it delivered, and you will be charged an emergency delivery fee if you run out.
  • Home Oil Tank Chart
  • Who do you call to service your tank? Once you know the type of tank you have, where it's located and how to monitor how much oil you have and need, find a reliable company to get into a supply contract with to make sure your tank never goes dry. Keep your tank at least a quarter full to prevent running out. Ask your oil tank service and supply company if they offer automatic delivery. This way you won’t have to wait until you get close to running out to order more; they will automatically deliver it to you.

It’s also a good idea to shop around for oil vendors and ask for estimates of their charge per gallon so you know how much oil you will need to budget. You can also ask your Realtor to contact the seller’s agent for bill copies from last year’s oil deliveries so you know what to expect.

Maintain Your Tank

It’s very important that you know your tank and have it assessed, inspected, serviced and maintained regularly.

If you have an above ground tank:

  • Check the site area. Check the platform that the tank sits on and make sure the legs and brackets are in good condition. Also make sure the tank is sitting in a protected area out of the rain, snow, and wind. Check for trees nearby. Make sure there is good access for the delivery driver and other professionals, but also make sure access is monitored to prevent theft of both the tank and the oil.
  • Check the tank itself. Make sure it’s not rusty, cracked, scratched, bulging, warped or corroded. All of these can lead to leaks, which is the main concern when dealing with oil tanks. Check the connectors, pipes, filters, vents, valves and around the drain. Make sure the vent whistle and the gauges work.
  • Check flow rates and make sure there are no blockages.

If your tank is installed underground:

  • Consider hiring a professional. It may benefit you to get into a maintenance contract with a professional. This is true with the above ground tanks, but especially true for those that are installed underground.
  • Maintain your tank each year. Prior to the winter season, have your oil tank AND your heating system checked, serviced and inspected every year. And while they are there, have them test to make sure condensation didn’t build up and contaminate the oil with water. This could cause the heating system to fail. Your service provider will be able to get the water out if it is found (remember, oil floats on top of water so it would be found at the bottom of the tank, causing a sludge mixture of rust, water, oil and bacteria). If you don’t take care of this problem, your tank will corrode (the same as if it is exposed to the elements). Some professionals even suggest to clean out the tank once every 5 years to help get rid of this water mixture and keep your tank in good working order. Good maintenance is key to prolonging the life of your oil tank.
  • Check for leaks. It is easier to see if an above ground tank is leaking with a visual inspection. If you find that your tank is leaking, do what you can to catch the leak until it can get fixed or replaced. Oil is toxic and harmful to the environment, contaminating the soil and sometimes even the ground water below. For underground tanks, you may have to get the soil around it and underneath it tested in order to find if there are leaks. And when selling your home, the buyer will most likely ask for testing to assure no leaking so it’s good to be proactive to avoid costly surprises.

Federal Clean-Up Laws

The Environmental Protection Agency (EPA) is responsible for handling oil tank leak clean-ups, as well as other environmental hazard and disaster clean-ups. They handle the investigation and supervision of the process and have created clean-up programs to respond to these situations. The EPA handles Emergency Response Programs. It handles the Superfund Program which was created in the early 1980’s to establish processes and compliance procedures for the clean-up of disasters including oil tank spills for sites that are abandoned, with grants available for local communities. The Resource Conservation and Recovery Act of 1976 (RCRA), does the same thing for active sites still in use.

The Underground Storage Tank Cleanup Program oversees all underground storage tank cleanups, and in the 1980’s Congress even established a Trust Fund for Leaking Underground Storage Tanks (LUST) to help cover clean-up and enforcement when the owner is unknown, unwilling to pay, or other circumstances. This was created when it became aware that the useful life was running out of underground oil tanks and there were more and more leaks happening. There are numerous other programs available through the EPA as well. These programs needed to be created to protect consumer health and our environment. For more helpful information, visit the EPA website.

Options for a Damaged Tank

Signs of leaking would result in stains around the leak and dying vegetation around the tank area. If it’s found that the tank is leaking and cannot be repaired, it will either need to be removed or abandoned. (Typically if it is bad enough to leak, a full replacement is the only option and the only true way to know if a tank underground is leaking is to remove it and inspect it.) There are now strict processes and procedures that must be followed either way, so make sure you know all the laws.

Removing the tank is always preferred over anything else:

If able to be removed, always hire a professional. It is the law. Removing the tank keeps your property safe, raises your property value and adds insurance benefits.

  • First the oil is removed from the tank by removing the gauge and inserting a hose to suck out the oil.
  • Then the tank is cut open and cleaned.
  • Then the vent and fill pipes are cut and removed, and the holes are filled with concrete. The tank is then removed.
  • If underground, the soil is tested to make sure the ground wasn’t contaminated.
  • Some indoor tanks are built-in to the home and could create some structural damage (doorways cut, windows cut, etc.) in order to remove it from the property. Always hire a professional.

Everything in the removal process can be recycled or reused. The leftover oil can be filtered and used for heating, the sludge can be processed and burned for industrial use and the metal can be scrapped and melted down for other things.

Removing your Home Oil Tank

But if your tank can't be removed:

It will have to go through a “tank closure-in-place” to abandon it. Abandoning should only occur as a last resort effort. For instance, if the tank is located in the basement and it would be impossible to remove it, the tank will need to be abandoned with the tank closure-in-place. This process requires cleaning, and then filling with sand, concrete or foam.

  • If it is necessary to fill the tank with this closure process, make sure you get the appropriate local permits.
  • Remove the oil in the tank prior to excavating, which will expose the top part of the tank. Once exposed, cut a hole in the tank and monitor.
  • Once it is left to air out enough, someone can enter and clean the tank by wiping and using a squeegee to remove all oil and sludge. This will be gathered, transported and disposed of appropriately.
  • The tank can then be filled and sealed (so no one delivers more oil).
  • Remember, filling abandoned tanks will not relieve the owner from responsibility of contamination. The owner is still responsible for cleanup.

Some companies offer package deals to remove the tank when replacing it with a new one. Always ask and find out what different companies offer prior to settling on a company.

And don’t forget to factor in that some areas will give fines for oil contamination. It is always best to do routine inspections and maintenance and replace with a new tank prior to it leaking.

New Tank Installation

If you have decided to stick with oil heat and replace the tank, first check the manufacturer’s specifications to know if it is best placed inside or outside. Here are the other things you should consider:

  • Who will install your new tank? Find a certified heating oil tank provider and installer to install your new tank (and even remove the old tank).
  • What size tank will you need? Maybe your family grew and you need a bigger tank. Or maybe you just want to save in the long run with the cost per gallon being less with a bigger tank. Residential heating oil tank capacity is measured in gallons or can be measured in inches by height, width and depth. Standard one or two bedroom homes need a 275 gallon tank. Any larger homes may require a 300-500 gallon tank. You will know how big of a tank you will need by how much oil you are planning to use.
  • How much space do you have to store a tank? The amount of space you have may limit the size of your tank.
  • What are your house specs? How many people are in your home, what is your home’s square footage and how many bedrooms does it have?
  • How conscientious are you on energy use?
  • Do you travel a lot or otherwise leave the home a lot? If you're away from home frequently, be sure to factor this into your needs.

The professionals can help you determine the right size needed for your property, with safety being number one concern — they will make sure to locate the safest place to install the tank. Money spent on hiring a professional and having your tank installed correctly will be well worth it! Correct installation also helps with efficient heating.

Convert to Another Heating System

We will just briefly mention that you do have the option to convert your heating system to a new gas or electric system. Just keep in mind that this option can get quite costly with tank removal, plumbing, ductwork, adding a chimney and more.

Home Heating Systems

Insurance and Warranties

Most oil tanks come with a 10-year warranty from manufacturer. If you keep up with inspections, you will be able to use this warranty if anything goes wrong within this time frame.

After 1998, the date started getting stamped on the outside of the tank so you know how old the tank is (if you don’t see a stamp, it is most likely older than 1998).

If you have had your homeowner’s insurance policy a long time, your oil tank may be covered but newer policies may not cover oil tanks. Check your policy before making any decisions. It is worth the extra expense to add coverage if possible especially if it means saving on out-of-pocket expenses related to tank removal and environmental clean-up.

Oil heat still remains a viable way to warm your home and technology only improves as time goes on. But in case things go wrong, you do have options. You can replace your oil tank and remove the old tank, you can abandon the old tank and put in a new one, or you can change your heating system altogether. Some homeowners have upgraded their heating system and abandoned the tank, with many not following protocol. Depending on location, there may not even be specific protocol to follow, with some homeowner’s doing the work themselves in the past, not providing for a clean environmental fix.

The most important thing to remember is routine maintenance goes a long way. The oil should flow well from the outlet pipe, and nowhere else. And safety is key to any decision you make in regards to your oil tank. The cost to determine if a tank is leaking, and then the cost to remediate this leak could extend into the thousands to hundreds of thousands of dollars depending on damage.

If contamination has occurred and is found, a home cannot sell until it has been cleaned properly. According to State Standards, this can make it hard for these homes to get issued a mortgage. Always know your options and work with your Realtor to get everything in writing throughout the process.

And lastly, each city or county is different but if your area pro-rates the remaining oil in the tank upon closing between seller and buyer, the buyer may have to compensate the seller at closing for any oil left. The oil company can come and measure and write up a letter to give to the closing agent at Settlement. Depending on your local market, the seller, buyer or one of the licensed Real Estate Agents can contact the oil company to start that process.

Hopefully we’ve shed some light on all the ins and outs of oil tanks so that it’s not so overwhelming and there are no unexpected surprises. Bottom line — when in doubt, we recommend consulting your Real Estate Agent to get advice appropriate for your local market.

Want more advice about all things home — including homebuying or selling advice? Nestiny is a great place for homebuyer education and to help you gauge how ready you are to buy a home. Journey Homeward allows you to enter all your wants and needs while the True Affordability Tool will break down your budget, showing what you can comfortably afford. You will also receive a Ready Report that will give you a vital head start in the home buying journey, saving you valuable time and money.

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