Wood Pellet Stoves

Wood pellet stoves look good and can keep you toasty warm. Photo credit: Hearth, Patio and Barbecue Association

There are two types of pellet stoves: freestanding decorative models, and those that can be inserted into an existing fireplace. You can also buy an actual wood pellet burner that is more utilitarian and resembles a boxy furnace similar to the one in your home.

DEAR TIM: Natural gas heating costs are expected to soar this winter. I thought I read about an inexpensive wood stove that burned some sort of pellets. My home is fairly well insulated and has a two-year old furnace and five-year old replacement windows. Should I buy one of these stoves? Will I save money doing so? Sherry A., Louisville, KY

DEAR SHERRY: The heating appliance you mentioned is most likely a pellet stove. These interesting devices burn countless small pellets that are made from wood that otherwise might be wasted or discarded from lumber mills and other raw wood sources. The wood pellets come in two different grades: premium and standard. The premium pellets produce less inorganic ash when burned. Wood stoves that burn premium pellets also require significantly less maintenance. Some pellet stoves also burn pellets with corn!

What are the types of pellet stoves?

But some people may debate with you the affordability issue of a new pellet stove. You may be able to buy an inexpensive used pellet stove, but a new one can often cost $2,000 or more. There are two types of pellet stoves: freestanding decorative models, and those that can be inserted into an existing fireplace. You can also buy an actual wood pellet burner that is more utilitarian and resembles a boxy furnace similar to the one in your home.

What are the differences between natural gas heating and a pellet stove?

If you are like most people who heat their homes with natural gas, the heating is done automatically. In other words, you set your thermostat or you program an automatic setback-type thermostat and do nothing for the entire heating season. The furnace turns on and off automatically and produces heat as you need it. A pellet stove is not as user friendly. You need to feed it pellets and the feeding schedule might be daily or every few days. If you stop feeding the stove, it will eventually run out of fuel. If time indeed is money, then you need to think about what your time is worth to feed the stove.

How fuel is needed for a pellet stove?

If you decide to abandon your new furnace for a pellet stove that produces the amount of heat you need, you might discover that you need between three and four tons of pellets per heating season. This quantity can vary significantly depending upon the amount of cold weather, the size of the home and the desired interior temperature a person or family requires to stay comfortable.

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The pellets are often available in 40 pound bags that might cost $3.50 each. Experts in the industry often suggest buying the pellets in bulk so that you get a discount and have enough fuel for the entire heating season. For sake of discussion, let's say you will need 3.5 tons of pellets, or 7,000 pounds. This means you will need to buy 175 bags at an estimated discounted price of $3.20 per bag. I compute a wood pellet fuel cost of $568.75 plus tax and perhaps a delivery charge. Keep in mind that the cost could be significantly higher for premium pellets, and can vary in different parts of the nation.

What is the cost difference in gas vs pellets?

Now it is time to look at last year's heating bills. Get out all of your utility bills from last year. If your bills are like mine, you will note that the electricity and natural gas usages are split and the costs associated with each are listed. Even though your current gas furnace uses electricity to operate the blower, let's just look at the natural gas part of your bills.

Add up the total cost of natural gas for October through and including April. These are the normal months when you heat your home. The peak heating months are typically December, January and February, but I'll bet your furnace operates to some degree during the other four months. Now add up the gas costs for the other remaining months. This gas cost includes what you might spend to heat water, dry clothes and cook food for the six months you do not heat your home. Subtracting this total from the total gas costs experienced from October through April will give you a rough estimate of what you actually spend in a given season to stay warm.

Once you have the estimated heating cost, you need to project what the higher cost might be this year. Your local utility company can assist you with this calculation. If your projected heating cost is less than the cost of the pellet fuel, you know it is smarter to stay with what you have. To save money on heating your home, the projected cost of natural gas must be higher than the annual cost of the wood pellets and the amortized cost of the pellet stove, plus any costs associated with its installation and ongoing maintenance.

One other issue comes into play when trying to make a decision on wood pellet stoves. The free-standing models are very attractive. A person may be willing to spend more money for an appliance that produces heat and looks good at the same time.

Pellet stoves also allow for zone heating. If you want to heat just part of your home during certain hours of the day, you can turn down the regular furnace thermostat and rely on the pellet stove to produce heat for the room or rooms you might be occupying. The exercise of trying to calculate the actual cost may seem easy, but alas there are some emotional issues that may come into play as you put the pencil to the paper.