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How Much Does Propane Tank Installation Cost?

Average National Cost
? All cost data throughout this article are collected using the RS Means construction materials database.
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Updated On

April 7, 2024

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Propane is a go-to fuel source for many homeowners residing in rural areas, so installing a tank to provide a constant supply is a logical step. Your next step is determining the propane tank installation cost on your property. And like many major home projects, installing a propane tank is no easy feat.

It requires careful budgeting to foot the bill and coordinating with local professionals to ensure a smooth installation. This article delves into the factors that impact the cost of a propane tank installation, average prices, and whether you can install one yourself.

Looking for a propane tank installation company? Use the tool below to get quotes from top-rated local plumbers today.

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  • Most homeowners pay around $2,500 for a whole-home propane tank installation.
  • Installation costs vary dramatically based on whether you install the tank above-ground or underground.
  • While some homeowners may have the equipment and experience necessary to install a propane tank, this project is usually best left to the professionals.

How Much Does It Cost to Install a Propane Tank?

The cost of installing a propane tank varies dramatically based on factors specific to your installation, including the size and location of the tank. Most homeowners pay around $2,500 for a whole-home propane tank. However, propane tank prices can dip as low as $300 or as high as $5,000 or more.


How Do Propane Tank Installation Costs Differ By Size?

The cost of a propane tank varies by size. Tanks range from 100 gallons or less to massive 1,000-gallon tanks perfect for heating an entire home. For the most part, larger tanks cost more than smaller ones. The chart below outlines average installation costs based on size.

Tank SizeAverage Cost
100 gallons$300 to $500
120 gallons$350 to $600
250 gallons$450 to $1,000
330 gallons$550 to $1,400
500 gallons$700 to $3,000
1,000 gallons$1,500 to $5,000+
Today’s Homeowner Tips
Propane tanks don’t hold their maximum capacity. For example, a 1,000-gallon tank doesn’t contain 1,000 gallons of propane. Instead, the tanks only hold 80% of their total capacities for safety reasons. Because of this, a 1,000-gallon tank holds 800 gallons of propane.

The video below reviews propane tank sizes and which one you may need for your home:

The Complete Propane Tank Sizes Guide

100 Gallons

A 100-gallon tank is one of the smaller options available, although you can find even smaller tanks for specific purposes. These tanks can power a few things, such as a generator, for a couple of days. However, they can’t power much for long unless you frequently refill the propane tank. On average, you’ll pay around $300 to $500 for one of these tanks.

120 Gallons

The 120-gallon tanks are slightly larger than their 100-gallon counterparts, serving a similar purpose. Like the 100-gallon models, they can’t power many appliances for too long, so they’re best suited to occasional uses. On average, this tank costs between $350 and $600.

250 Gallons

A 250-gallon tank offers a solid capacity without going overboard, making it ideal for a handful of larger appliances. For example, you can power a hot tub, stove, fireplace, or water heater. Although the compatibility will depend on the specifics of the appliance and how frequently you use it, a 250-gallon tank can be a good option. These tanks usually cost between $450 and $1,000.

330 Gallons

A 330-gallon propane tank takes things a step up but still doesn’t hold enough propane to power a full-sized household for a long time. Of course, it can work for smaller homes and individual purposes, like the 250-gallon tank. It costs between $500 and $1,400.

500 Gallons

A 500-gallon tank is perfect for heating an entire home or supplying power for several appliances. It has a large enough capacity to provide plenty of propane for various needs, making it a good option for all sorts of purposes.

These tanks usually cost between $700 and $2,500 for an above-ground installation or up to $3,000 for an in-ground installation.

1,000 Gallons

The 1,000-gallon propane tanks offer an impressive capacity best suited to larger homes and smaller businesses. They work well for heating larger homes, powering numerous appliances, or powering a backup generator for days.

These models usually cost between $1,500 and $3,000 for an above-ground installation or up to $5,000 or more for an in-ground installation.

How Does Location Affect Propane Tank Installation Pricing?

When installing a propane tank, you can position it in one of two places: above or underneath the ground. Each option has its merits, and the one you select will significantly impact the final cost of your installation.

Installation TypeAverage Cost
Above-ground tank$300 to $3,000
In-ground tank$1,500 to $5,000+

Above-Ground Tank

An above-ground tank is a solid option for homeowners with ample backyard space and a stricter budget. Installing these tanks is usually more affordable, as the process doesn’t require as much time and labor as an underground tank.

Above-ground propane tank in a backyard
Image Credit: Canva

These tanks are easily accessible, making checking for issues and refilling a breeze. Maintenance and other repair work is straightforward, as there’s no digging necessary to access the tank. This can cut costs in the long run, saving you time and labor.

Most homeowners pay between $300 and $3,000 for an above-ground propane tank installation. However, it’s important to note that the cost may rise based on building code requirements. For example, placing the tank on a concrete pad in a specific section of your yard is commonly necessary, which can raise the final cost.

In-Ground Tank

An underground propane tank is an excellent choice for homeowners who don’t want the eyesore of an above-ground tank. These tanks are buried a few feet underground, so they’re hidden out of sight. Of course, a couple of pipes and gauges are visible above the ground, but much of the system is tucked away beneath the soil.

Propane gas tank buried underground
Image credit: Adobe Stock

These tanks have a layer of protection against severe weather and freezing temperatures, using the earth around them as a buffer against the elements. On top of that, the fire risk is much lower in case of a gas leak, as the tank is covered in soil.

These tanks can last decades with routine inspections and maintenance, but it’s important to note that costs associated with upkeep are often steeper, as the tank is harder to access.

Most homeowners pay between $1,500 and $5,000 or more. The additional costs are directly associated with the increased difficulty, time, and labor required to complete the underground installation.

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Which Factors Impact Propane Tank Installation Cost Estimates?

Aside from the propane tank sizes and location factors, a handful of additional factors contribute to the final cost of your propane tank installation. These factors can significantly impact your final bill, so it’s essential to consider them and budget accordingly.

Distance From the House

Most contractors follow the National Fire Protection Association requirements for propane tank distances when installing a residential propane tank. Some areas may not require you to follow these guidelines, but many do.

For example, under these guidelines, you may need to install your 500-gallon tank at least 10 feet away from your home and any combustion sources. Septic drain fields can further restrict the placement area.

Since your installer will need to install pipes from the tank to supply propane to your home, costs will increase. More trenching is necessary to lead the lines to your home, as are more materials, time, and labor. So, the further away your propane tank is from your home, the more you’ll pay in installation costs.

Inspections and Permits

Like most building and home-related projects, installing a propane tank often requires specific permits. The permits for your project will vary based on your area, but many areas require homeowners to obtain specific permits before completing the project.

These permits often cost between $25 and $50, although costs might be higher in some areas.

Additionally, remember to budget for inspection costs. If you install an in-ground propane tank, you’ll usually need to have an inspector examine it for leaks and check the valve for signs of issues. This often costs between $50 and $75 annually, although costs may be higher or lower in some locations. 


Labor cost is a primary factor contributing to the number on your final project bill. The more time and labor necessary to complete the project, the pricier it will be.

Generally, above-ground propane tanks are more affordable, as they don’t require as much labor to install. However, if you need to pour a concrete pad for the tank, you can expect to pay more to hire another contractor to pour the pad.

In contrast, an in-ground propane tank typically costs more than its above-ground counterparts. These installations entail an excavation process to prepare the site for the tank. On top of that, trenching might be necessary (depending on the tank’s distance from your home) to install pipes that bring the propane to your home.

This takes more time and translates to higher labor costs. However, costs will vary between propane companies, so get more than one quote.


The initial preparation is key when installing a residential propane tank. If you’re installing an in-ground propane tank, your installer will need to excavate the site to prepare for the propane tank. Generally, it costs between $50 and $200 per cubic yard to excavate an area.

On the flip side, if you’re installing an above-ground propane tank, you might need to pour a concrete slab. Requirements for concrete slabs and propane tanks vary based on location, but some locations require you to pour a concrete pad for the tank to sit on. The cost of the concrete pad varies based on its size, location, and the contractor you hire to complete the task.

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What Are the Benefits of Installing a Propane Tank?

Propane tanks offer an array of benefits that may appeal to various homeowners, whether you reside inside city limits or far beyond them in a rural area. From a reduced carbon footprint to versatile uses, propane can be an outstanding choice for all sorts of power needs.

Reduced Carbon Footprint

If you’re looking for a more environmentally friendly way to heat and power your home and its appliances, propane can be an excellent option. It’s a clean-burning alternative to other fuel sources yet comes at an affordable price and is widely available.

Its clean-burning nature means it doesn’t cause as much soot and scale buildup on appliances as gasoline or diesel. This translates to a decreased need for frequent maintenance, longer appliance lifespans, and increased heating efficiency.

It’s non-toxic and nonpoisonous, making it an excellent substitute for natural gasses that can wreak havoc on the environment if they spill. Propane doesn’t contaminate the soil, even if it does spill underground, making it an excellent choice for homeowners who want to install a buried tank.

Versatile Uses

Propane is a versatile fuel source that can adapt to different needs. You can use it to power your home’s heating setup if you have a propane furnace or similar heating system. It works to produce hot water, power cooking appliances, and dry clothing.

You can use it to heat your pool as summer ebbs into fall, power your fireplace for cozy nights, and even power various types of construction and landscaping equipment. It also works to power some outdoor grills for a delectable barbeque or to step in and power your generator as an alternate power source when the electricity goes out.

Convenient Alternative to Natural Gas

While accessing natural gas lines to power a home in a city might be a breeze, this isn’t always the case for rural homeowners. The story looks considerably different for those who live more than a hop, skip, and jump out of city limits. These homeowners often don’t have easy access to a natural gas line, so bringing one to their home can cost tens of thousands of dollars if it’s even an option.

With a propane tank, the concern of bringing a natural gas line to your home becomes a thing of the past. Propane is readily available nationwide, and many suppliers offer scheduled deliveries to ensure you never run out of it.

Since the tank is installed on your property, you don’t need to worry about connecting to a network of existing natural gas lines. Instead, you pull directly from the installed propane tank, eliminating the need to pay tens of thousands of dollars in natural gas hookup costs.

Lower Operating Costs

Propane is a cost-effective alternative to other forms of power, like natural gas or electricity. This makes it an excellent choice for homeowners who want to save money in the long run, as running everything in a house can be expensive.

For example, a propane water heater can produce up to two times as much hot water as an electric unit in the same timeframe. The story is much the same with other appliances throughout your home, so the savings add up quickly.

Professional vs. DIY Propane Tank Installation

While DIYing some home projects to save money is a feasible option, it’s not a viable choice for most propane tank installations. Here’s what you need to know about DIYing your propane tank installation versus hiring a pro.

Doing Propane Tank Installation Yourself

Installing a propane tank as a DIY project is doable with the proper experience. However, these projects often require a concrete slab or heavy machinery to excavate a hole for the tank. And since you are dealing with combustible gas, we don’t recommend installing a propane tank without professional assistance.

If you get the proper permits and DIY this project, the costs associated with renting heavy machinery and other tools can climb nearly as high as hiring a professional. On top of that, you’ll need to devote hours to the installation, so in the end, it might be more cost and time-effective to hire a pro.

Hiring a Professional for Propane Tank Installation

In many cases, hiring a professional is the best way to handle a propane tank installation. The professionals have the heavy equipment necessary to tackle jobs like these, so you won’t have to worry about renting and transporting the oversized tools to your home.

On top of that, there’s no guesswork involved, as they’re professionals with extensive experience in the industry. Since hooking up the pipe system correctly can be complex, having a licensed plumber do it for you is often your best bet.

Here are a few tips to help you find a professional in your area:

  1. Do a quick search: Look up local professionals offering propane tank installation services near you. Talk to friends and family about their experiences and gather recommendations.
  2. Select top providers: Read through company reviews to weed out sub-par providers and select a few highly-rated options.
  3. Obtain quotes: Contact each provider and obtain a personalized quote for your project.
  4. Compare: Use the quotes you get from your top picks to compare your options.
  5. Select a provider: Choose the provider that best fits your needs.
  6. Schedule an appointment: Call the provider you choose to schedule an appointment to complete the installation.
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So, Is Propane Tank Installation Worth It?

If natural gas isn’t a viable option for your home or you prefer the benefits of propane, installing a propane tank can be a worthwhile venture. It’s an excellent alternative for many homeowners, providing impressive benefits, from a reduced carbon footprint to versatile uses.

Since propane tanks can last decades with proper inspections and maintenance, they’re an excellent investment for those considering the merits of at-home propane tanks.

You can expect to pay as little as $300 for a small, above-ground propane tank installation or as much as $5,000 or more for a large, in-ground propane tank installation. Ultimately, the price will hinge on factors specific to your installation.

FAQs About Propane Tank Installation

How long does a 500-gallon propane tank last?

A 500-gallon propane tank can last anywhere from two to eight months. The exact lifespan will hinge on factors specific to your situation, including the size of your home and heating needs.

How much does it cost to fill a propane tank?

On average, it costs between $2 and $4 to fill a propane tank. The cost of filling your propane tank will depend on the size of the tank.

How deep should a propane tank be buried?

Most propane tanks are buried several feet beneath the ground. The hole size depends on the size of the tank. For example, a 500-gallon propane tank usually needs a 12- by 5- by 6-foot hole that situates the tank a few feet underground.

How far should a propane tank be from my house?

In most cases, buried propane tanks must be at least ten feet from the house. However, they can be further away from your house but will require a longer propane line and increase your installation costs

Editorial Contributors
avatar for Jonathon Jachura

Jonathon Jachura


Jonathon Jachura is a two-time homeowner with hands-on experience with HVAC, gutters, plumbing, lawn care, pest control, and other aspects of owning a home. He is passionate about home maintenance and finding the best services. His main goal is to educate others with crisp, concise descriptions that any homeowner can use. Jon uses his strong technical background to create engaging, easy-to-read, and informative guides. He does most of his home and lawn projects himself but hires professional companies for the “big things.” He knows what goes into finding the best service providers and contractors. Jon studied mechanical engineering at Purdue University in Indiana and worked in the HVAC industry for 12 years. Between his various home improvement projects, he enjoys the outdoors, a good cup of coffee, and spending time with his family.

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Roxanne Downer


Roxanne Downer is a commerce editor at Today’s Homeowner, where she tackles everything from foundation repair to solar panel installation. She brings more than 15 years of writing and editing experience to bear in her meticulous approach to ensuring accurate, up-to-date, and engaging content. She’s previously edited for outlets including MSN, Architectural Digest, and Better Homes & Gardens. An alumna of the University of Pennsylvania, Roxanne is now an Oklahoma homeowner, DIY enthusiast, and the proud parent of a playful pug.

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