# Pre-buy

By Nick Bruzzi · Published 2026-07-08 · https://heatprice.com/glossary/prebuy

A contract in which you pay up front — usually in the summer off-season — for a set number of gallons at a locked price for the coming winter, and the dealer delivers against that prepaid balance.

A pre-buy protects you from mid-winter price spikes but offers no downside: if the market falls below your locked rate, you're still bound to the higher price. And because you've prepaid in full, you're an unsecured creditor if the dealer fails before delivering — a real risk in Rhode Island and Massachusetts, which — unlike some neighboring states — don't require dealers to financially secure prepaid funds, though § 5-82-1 and Chapter 93A still regulate the contract and give you recourse.

Source: R.I. Gen. Laws § 5-82-1 (guaranteed-price plans; 12-month cap, 14-day written confirmation).

## See also

- [pre-buy vs price-cap](https://heatprice.com/guides/prebuy-vs-cap-price-heating-oil-contracts)
- [Price-cap contract](https://heatprice.com/glossary/price-cap-contract)
- [Fixed-price contract](https://heatprice.com/glossary/fixed-price-contract)

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