It’s impossible not to notice this season’s low oil prices. In the wood heat world, where the easiest way to promote a fuel switch is (arguably) to emphasize cost savings, this isn’t the terrific news it is for people whose oil bills have dropped. On the other hand, it gives us an opportunity to look at oil and wood cost trends and to highlight some of the other reasons that modern wood heat makes sense.
First, it’s critical to look at trends and price stability. History shows us that average oil prices are steadily increasing over the long term, and much more steeply than wood prices. In addition, oil prices are notoriously volatile. Consumers are economically safer with predictable fuel costs that aren’t tied to geopolitical decisions halfway around the world.
Second, 100% of what consumers spend on regionally produced wood pellets remains within the region, versus just 22% of what they spend on heating oil. Annually this results in millions of dollars leaving the Northern Forest region entirely. Buying “local heat” supports forest health and the forest economy, sustaining and creating jobs for loggers, truckers, pellet manufacturers, installers expanding into new markets, and so on. Just as buying local food helps people feel connected to the land and the people who grow their food, so can buying local heat create an affinity for working forests.
Speaking of pellet production, it’s important to note that bulk delivery of wood pellets continues without a hitch, even when retailers sometimes run short of bagged pellets. Our region has capacity to bring more pellet production online, creating more jobs and providing a market for low-grade wood from local forests.
Finally, a reality check: wood pellets are still economical compared to heating oil. For example, last February, bulk wood pellets in New Hampshire cost about 50% less than oil per BTU. This week, they’re nearly 30% lower – still a substantial savings. Despite the drop in oil prices, wood pellets still come out ahead. I know that’s where I’d put my money (and in fact, I do!).
So, are we on solid ground to continue to encourage more people to shift to wood pellets? Absolutely. They’re less expensive, we doubt oil prices will stay low, and we have confidence in people’s affinity for local jobs, benefits and working lands. We will continue to help shift much more of the oil-dependent Northern Forest to an energy economy based on modern wood heat. For more about how you can explore this option, see our webpage.