Wood pellet pricing has remained steady over the past decade and is expected to remain so, pleasing many bulk pellet delivery customers in the Northeast this winter.

While fossil fuel costs are historically volatile, the cost of heating with locally sourced wood pellets remains steady over time, so pellet households can have some peace of mind heading into a cold winter.  Maine Energy Systems (MESys), a bulk wood pellet delivery provider based in Maine, has already offered its customers locked in pricing for the rest of the heating season.

Wood pellet pricing isn’t expected to fluctuate because unlike other fuels, pellets are created from byproducts of other forest industry endeavors, so their availability and price don’t behave the same way.  With the decline in the paper industry in the Northeast over the last several years, there has been a decline of several million tons per year of demand for sustainably harvested waste and pulp wood.  Significantly, urban waste wood, sawdust, and other sawmill by-products are also in excess supply.

Wood pellets are typically made from wood that’s already harvested for lumber, flooring, furniture, paper, tissue, and packaging, or from those trees in the harvest that are not suitable for those primary industries.  Using pellets to reduce the heating carbon footprint of homes is a logical and cost-effective path for those who reside in colder climes.   With bulk delivery, customers don’t see or handle the pellets, so it’s as easy as most conventional heating fuels.

The graphic below shows the cost difference in heating an average home in the Northeast.  The costs used in this graph are the projected per gallon costs of #2 heating oil and propane by the US Energy Information Agency in October 2021.  Pellet pricing is based on actual cash price of a ton of bulk delivered pellets.

Projected Oil and Propane costs used are from US EIA projections published October 2021 for the ’21-’22 heating season.  Pellet cost is actual cash price per bulk-delivered ton through Maine Energy Systems.

Wood pellets are an appealing fuel source for economic and environmental reasons.  Homes heated with pellets can drastically reduce their carbon footprint since wood pellets are a carbon neutral fuel at the point of combustion according to the US Environmental Protection Agency (EPA).  Pellet heating also keeps dollars spent on fuel within the Northeast, benefiting the regional economy and jobs.

Policies encouraging homeowners to rely on renewable fuels are multiplying.  Currently there is a 26% Federal Tax Credit that can be applied to the total installation cost of a new central pellet heating system, and many states offer rebates of thousands of dollars.  These incentives combined with a price-stable, environmentally friendly fuel source are allowing many families in the Northeast to reap the warmth of modern wood heating.

About Maine Energy Systems

Maine Energy Systems (MESys) builds and distributes the world’s finest fully automated wood pellet boilers and furnaces for residential, commercial, and industrial use throughout North America.  MESys also delivers bulk wood pellets to many of the Northeast states using state-of-the-art pellet delivery equipment that’s specifically designed to deliver wood pellets with the least amount of dust possible.  This ensures that pellet heating systems continue to serve homes, businesses, and institutions at their best.

About the Biomass Thermal Utilization (BTU) Act

Right now, there is a 26% Federal Tax Credit that can be applied to the total cost of installing a central wood pellet heating system and the credits slated to continue through 2023.  The BTU Act is a powerful supporting policy for renewable heating.  There is a current proposal in Congress to extend the BTU Act to include commercial and business installations for biomass heat and lengthen it through 2033.

The impact to the local economy is large: every dollar that’s spent on heating fuel in Maine results in about 68% of that dollar leaving the Maine economy, according to the US Energy Information Administration (EIA), and this is similar across New England.  The BTU Act will help keep millions in fuel dollars in New England’s economy.

The BTU Act impacts homeowners through immediate savings on heating and the ability to access both the Federal Tax Credit and state rebate incentives.  Also, businesses and commercial applications of renewable heat will benefit and support the growth of heating with renewable, environmentally friendly, local fuel.  The BTU Act is simply a way to support a technology that’s clean and efficient at a comparable cost to fossil fuel systems.  This alleviates the cost barrier of installation for consumers, especially in high fuel cost times like now.