Two-thirds of companies report an increase in per-gallon profit margins, despite uncertainty from the ongoing conflict in the Middle East. More companies are utilizing AI, and employee recruiting and retention continues to challenge dealers.
Gray, Gray & Gray – A Frazier & Deeter Company, (www.frazierdeeter.com), a consulting, accounting, and business advisory firm serving the fuel oil and propane industries, has released the results of the firm’s 35th Annual Energy Industry Survey. The survey serves as an important benchmark for delivered fuel marketers throughout the U.S.
The 2026 Energy Survey results are based on reported operational and financial data for the heating season spanning April 2025 through March 2026. This year’s survey featured additional operational insights from Angus Energy, an industry leader in data analytics, and the Propane Education & Research Council (PERC).
“Although disruption in product supply from the ongoing conflict with Iran created uncertainty in the market toward the end of the season, most heating oil and propane dealers emerged intact,” says Marty Kirshner, CPA, MSA, the Partner leading the firm’s Energy Practice Group. “The challenge now will be planning effectively for the coming season.”
Some of the highlights from the results of the 2026 Energy Industry Survey include:
- Use of artificial intelligence (AI) by fuel dealers has increased significantly during the past year, with 67% reporting they have incorporated AI into their business operations, a jump of 50% over 2025.
- Recruiting and retention of personnel continues to be a challenge for dealers. 50% report between 1 and 5 open positions.
- While 66% of dealers responding to the survey report they have a formal marketing budget, 40% of companies spend less than 2% of their gross revenues on marketing.
- Despite numerous challenges facing the industry, only 2% of dealers reported a decline in profitability, while 66% have increased their per-gallon profit margin.
Complete results of the 2026 Energy Industry Survey, including a breakdown by gallons, are available at www.frazierdeeter.com or by calling (781) 407-0300.
Number of states in which you do business
1 State: 66%
2 States: 15%
3 States: 10%
4 States: 2%
5+ States: 4%
Other: 2%
Total Number of Full-Time Equivalent Employees
1-5: 2%
6-10: 11%
11-20: 23%
21-30: 15%
31-40: 10%
41-50: 9%
51+: 29%
Number of customers per Service Technician: 1,008
Total Number of Vacant Positions
0: 25%
1-5: 50%
6-10: 15%
11-20: 2%
21-30: 2%
31-40: 3%
41-50: 2%
51+: 1%
Do you recruit from vocational or trade schools?
Yes: 70%
No: 30%
What are the most effective employee recruitment platforms you’ve used outside of vocational or trade schools?
LPGasJobs.com: 32%
Facebook: 26%
LinkedIn: 42%
NextGenPropane.com or GenerationNextEnergyPros.com: 23%
Other:44%
Other responses:
- Other Recruitment Websites (Indeed, Zip Recruiter, SEPATec)
- Word of Mouth
- Local Advertising (Signage, Newspaper, etc.)
- Referrals (Employees, Friends)
- Vocational schools
What percentage of your drivers are cross-trained as technicians?
0%: 13%
1-25%: 46%
26-50%: 25%
51% or more: 16%
Are you cross-training employees to keep them employed year-round vs. laying them off during the off-season?
Yes: 73%
No: 27%
Average number of service calls per customer: 0.57
What is the HOURLY rate you pay?
Customer Service Representatives: $24.24
Delivery Drivers: $28.85
Dispatchers: $28.01
Salesperson: $31.33
Service Manager: $44.09
Service Technicians $32.66
How do you pay employees commission on securing new equipment installations?
Percentage of gross margin: 48%
Dollar per account: 24%
Other: 29%
Other responses:
- No Commission
- Percentage of Sale
What percent of the health insurance benefit is paid by the employer?
0-50%: 25%
51-75%: 33%
76-100%: 42%
What was the biggest change you made to retain employees in the current year that you have not done previously?
Wage and salary increases: 36%
Flexible work schedules: 20%
Improved employee relations and training: 9%
Employee training & cross-training: 11%
Deferred compensation: 2%
Bonuses: 13%
Additional paid time off: 4%
Other: 4%
Does your company currently have any deferred compensation plans in place to retain key employees?
Yes: 45%
No: 55%
Has your company considered changes to delivery planning for high‑K customers in response to recent cold snaps and higher overtime costs?
Yes: 63%
No: 37%
How are you protecting your business against a cyberattack and data loss?
Encrypted cloud-based data storage: 55%
Anti-malware software/Endpoint protection: 65%
Secure data backup for disaster recovery & business continuity: 67%
Written information security plan (WISP): 36%
Staff training: 55%
Cybersecurity insurance: 55%
Engaged a cybersecurity consultant: 26%
Not sure what I should be doing: 1%
Which of the following artificial intelligence (AI) use cases does your company currently use or pilot?
Delivery forecasting / auto‑delivery optimization: 23%
Route optimization and dispatch planning: 30%
Tank monitoring analytics or run‑out prevention: 35%
Predictive service or no‑heat prevention: 11%
Customer service automation (chatbots, call summaries, self‑service): 29%
Pricing, margin, or hedging decision support 16%
Inventory, bulk plant, or supply forecasting: 15%
Marketing, lead generation, customer retention, or churn prediction: 25%
General communications or content generation (customer letters, emails, newsletters): 23%
Safety, compliance, or driver behavior monitoring 25%
Energy efficiency auditing, load analytics, or system performance analytics: 10%
Accounting, invoicing or AR/AP automation: 15%
Hiring, scheduling and workforce management: 10%
We do not currently use AI: 29%
Not sure / don’t know: 4%
If your organization is NOT currently using artificial intelligence (AI), please select all applicable reasons:
Lack of understanding of AI; desire for training: 35%
Intimidated by AI: 11%
Employee resistance: 17%
Concerns about legal, confidentiality or security issues: 30%
Waiting to establish an AI Use Policy: 14%
Not applicable – we currently use AI 39%
How long have your customers been with your company?
Less than 1 year: 7%
1-2 years: 7%
2-3 years :6%
3-4 years: 6%
4-5 years: 6%
5+ years :64%
Unknown: 3%
If you lost customers last year, what do you most attribute your customer losses to?
Competitor with lower prices: 31%
Competitor with similar pricing: 11%
Gas conversion: 7%
Electric heat pump (ducted or ductless/mini-split) conversion: 19%
Customer moving away or passing away: 25%
Customer service issues: 2%
Other reasons: 4%
Other responses:
- Did not lose customers
- Delivery/service Issues (lack of technicians)
If you gained customers last year, what do you most attribute your customer gains to?
Lower pricing: 4%
Competitive marketing/increased sales efforts: 25%
Customer referral: 21%
Poor competitor customer service: 27%
Acquisition: 7%
Diversifications into new products or services: 8%
Fuel conversions from another energy source: 5%
Expansion into new service areas: 1%
Other reasons: 2%
Other Responses:
- Better customer service
- Product offering (variety)
What percentage of your active customers became inactive last year (had no fuel oil deliveries within the last 12 months and/or no propane deliveries within the last 18 months)? 5.82%
What products or services are you considering adding in 2026 to flatten out revenues for your business through the entire year?
Generators: 30%
Plumbing: 25%
HVAC (installation and service): 28%
Electricity Conversion (heat pump): 33%
Pest Control: 14%
Home security: 12%
Septic 10%
Water delivery (water for pools or commercial or industrial uses): 16%
Electrical contracting services (different from heat pump installations): 20%
Other: 30%
Other responses:
- Landscaping (excavation)
- Cleaning services (ducts)
- Renewable fuel options (biofuel blends, green diesel)
- Natural gas piping, more appliance sales and installation, and more contractor work installing tanks year-round in new builds.
- Cylinder filling/trade cages
- Water Treatment
- Delivered on- and off-road diesel fuel, including on-site tank rentals
- Accessory sales
- Starting a separate COD business
- Building a new gas station
- More marine bulk fueling
- Bar
What products or services have you already added to your business to offset the seasonality of your business?
Generators: 39%
Plumbing: 23%
HVAC (installation and service): 55%
Electricity Conversion (heat pump): 41%
Pest Control: 15%
Other: 23%
Other responses:
- Tank Services (Removals, Installs, Refurbs)
- Diesel
- Automotive Repairs
- Gas Stations / Convenience Stores
Are you considering any of the following in the next 12 months?
Key employee plan: 33%
Merger: 14%
Acquisition: 50%
Sale: 20%
Upgrade Software: 44%
Investing in artificial intelligence (AI): 31%
Other: 7%
Other responses:
- Expansion to new products and markets
- Employee Benefits (promotions, bringing all departments together)
What is the most impactful business operations change you made in the last 12 months?
Business acquisition and/or expansion to new location(s): 11%
Upgrading and adding new technology and/or back-office software: 22%
Cross-training staff: 14%
Adding new staff: 9%
Increased and/or better margins: 21%
Added or expanded usage of tank monitors: 14%
Expanded service capabilities: 7%
Other: 2%
Other responses:
- Streamlining jobs and departments for higher efficiency
- Hired business coach
What impact, if any, did recent cold winters have on customers who converted to heat pumps?
No noticeable impact: 14%
Higher customer energy bills: 45%
Inadequate heating performance: 44%
Customers reverted to legacy systems: 30%
Not applicable/Unsure: 17%
What percentage of your customers had run-outs during the last heating season?
Less than 0.5%: 33%
0.6-2%: 46%
3-5%: 17%
More than 5%: 4%
Which of the following general safety programs or policies does your organization currently have in place?
Written safety policy: 73%
Written personal protective equipment (PPE) policy 9%
Distracted driving policy: 63%
HazCom program: 45%
Safe lifting education program: 45%
Near- miss reporting policy or program: 28%
Safety rewards program: 19%
Does your company participate in your state’s Low Income Home Energy Assistance Program (LIHEAP)?
Yes: 78%
No: 12%
Not sure: 10%
During this past heating season, did Low Income Home Energy Assistance Program (LIHEAP) funding uncertainties, delayed payments, or administrative disruptions create operational or cash-flow challenges for your company?
Yes, significant challenges: 17%
Yes, minor changes: 39%
No: 36%
Not applicable: 9%
Have you developed a strategic business plan laying out what your company will look like 2-5 years from now?
Yes: 59%
No: 41%
If you have developed a strategic business plan, what is the biggest change as a result?
Expansion: 26%
Cross-training employees allows us to focus on other areas like HVAC: 12%
Less dependency on fossil fuels: 4%
More focused employees: 10%
Diversified product mix: 11%
Achieved a certain valuation: 3%
Increased marketing presence: 11%
We have not developed a strategic business plan: 23%
Have you implemented a succession or continuity plan for the next generation?
Yes: 57%
No: 43%
What do you feel are the primary challenges/issues facing your organization?
Employee recruitment and retention: 55%
Employee training: 27%
Regulatory uncertainty (federal, state or local): 48%
Investing in technology: 28%
Succession planning: 28%
Strategic planning: 23%
Customer retention and competition for customers 36%
Margin pressure from rising operating costs: 43%
Other: 4%
Other responses:
- Cybersecurity & data protection
- Insurance
- Generational differences with employees
- Market expansion costs
- Increased Heat Pump Market Competition
- Fuel Supply & Pricing Volatility
Which of the following approaches do you think are the most effective strategies for growing your organization?
Retention of existing customers and greater focus on cross-selling your services/products: 68%
Addition of new customers in your existing geography: 76%
Addition of new customers in new geographies (adjacent to your existing geography): 41%
Addition of new service/product offerings: 38%
Acquisition of another company: 22%
Other: 1%
Other responses:
- Give them fast service
Do you create a marketing budget each year?
Yes: 66%
No: 34%
What percentage of your gross margin do you spend on marketing?
Less than 2%: 40%
3-4%: 33%
5-6%: 22%
More than 6%: 6%
How do you track the effectiveness of your marketing?
CRM Platform: 28%
My marketing manager is responsible for tracking: 43%
My marketing manager provides regular reporting: 43%
I don’t track my marketing effectiveness: 31%
Other: 5%
Other responses:
- Outsourced Marketing Provider
- Online Tracking (Google, etc.)
- Attribution modeling
How many gallons of fuel oil did you sell during the 12 months ended March 31, 2026?
Fuel Oil – Residential
0-999: 26%
1m-4999: 45%
5m-9999: 19%
10m-14999: 7%
15m and over: 3%
Fuel Oil – Commercial
0-999: 49%
1m-4999: 23%
5m-9999: 14%
10m-14999: 9%
15m and over: 5%
What percentage of biofuel do you blend?
0%: 32%
1-10%: 31%
11-20%: 22%
21-30%: 10%
31% or more: 5%
What percentage of active customers are on a budget plan?
1-20%: 47%
21-40%: 36%
41-60%: 14%
61% or more: 3%
What percentage of active customers use a price protection plan?
1-20%: 52%
21-40%: 28%
41-60% 16%
61% or more: 5%
What percentage of your customers’ OIL tanks have tank monitors?
0%: 32%
1-25%: 44%
26-50%: 16%
51-75%: 5%
76-100%: 3%
Do you charge customers for tank monitoring?
Yes: 50%
No: 50%
If you charge customers for tank monitoring, what is the total annual fee you charge them?
Fuel Oil: $186.98
What is your company’s average gallons delivered per stop?
Avg. fuel oil gallons per stop: 193
Stops per hour: 2.2
Gallons delivered per hour: 425
If you offer service contracts to customers, what is the average service contracted price?
Fuel Oil
$100-$200: 11%
$201-$250: 20%
$251-$300: 32%
$301-$400: 19%
$401+: 5%
NA – we do not offer service contracts to customers: 33%
Do you have bulk storage facilities?
Yes: 88%
No: 12%
How are you maintaining profitability in times of rising costs?
Increasing per gallon
profit margins: 66%
Offering other paid-for services: 22%
Focusing on correcting my Ks: 35%
Looking for ways to make larger (and fewer) deliveries: 57%
Optimizing fleet utilization and delivery routing: 39%
Increasing enrollment in service agreements, budget plans or auto-delivery: 13 or 24%
Reducing operating or overhead costs: 43%
Implementing new pricing strategies or fees: 26%
I have lost profitability: 2%
