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Wood Pellets: A Convenient, Affordable Alternative to Heating Oil

The rise in heating oil and propane prices has consumers in the northeast once again evaluating renewable heating fuels and technologies.  One alternative that has gained widespread attention is the use of wood pellets in space and central heating.

Wood pellets have been manufactured in the US since the early 1970's.  Consumer awareness has grown with increasing cost and price volatility of heating oil, propane and natural gas over the last decade.  Today the market is somewhere between 600,000 to 800,000 tons annually in New England and New York with perhaps as many as 300,000 homeowners and a small number of municipalities and businesses using pellet fuel as primary or supplemental heat.

The vast majority of pellet consumers provide space heat with pellet stoves, which will likely continue to be popular.  However, a diversity of central heating boilers and furnaces are becoming available in the northeast, with high and fully automated European systems making recent market inroads.

The discount in heating cost with pellets is significant.  With current heating oil prices averaging over $3.75/gallon, and delivered pellet fuel averaging $250/ton, pellet heat currently costs around $18/MMBTU and heating oil around $34/MMBTU.  Propane is even more expensive at $48/MMBTU with average fuel price over $3.50/gallon.

Most pellet fuel is distributed and purchased in 40 lb. bags, but bulk delivery options are increasing across the northeast.  With automated central heating systems and bulk fuel delivery, pellets are becoming almost as user friendly as heating oil or propane.    Across Scandinavia and much of western Europe, central heating and pneumatic bulk delivery are the norm.

The heating oil industry ought to be leaders in helping develop this new opportunity!  The heating oil industry understands energy delivery, heating system sales and service, and how to talk to homeowners and businesses about alternatives.  New England Wood Pellet works with many oil dealers now who deliver bagged pellet fuel, and some that are diversifying into the sale of pellet heating systems and bulk delivery.  If Europe is any indication, there is tremendous growth potential.  The pellet industry and the heating oil industry should work together to advance this home-grown, renewable heating fuel alternative.  By doing so we will see new growth opportunities and help reduce our region's vulnerability to global energy volatility over which we have little control.

For more information, check out www.nebioheat.org.  A major conference and tradeshow focused on heating with biomass fuels will take place in Manchester NH April 14-15, 2011.  Learn more at www.heatne.com.

Founded in 1922 by industry pioneer Steve Walker, New England Wood Pellet is the largest manufacturer and distributor of wood pellet fuels in the northeastern US.  With a total capacity of 250,000 tons per year from three manufacturing plants in Jaffrey NH, Schuyler NY and Deposit NY, the company produces enough fuel to directly displace nearly 30 million gallons of heating oil annually.  Visit www.pelletheat.com for more information.

Charlie Niebling
Excerpts from Heating Oil News



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