FutureMetrics suggests 4.3 million homes ripe for pellet heat

By Sue Retka Schill | March 10, 2014

A new white paper from FutureMetrics LLC makes the case for pellet heat, analyzing the number of rural households and the availability of sustainable forestry resources, concluding that not only will buying local for pellet heat lower consumer heat and hot water energy bills, but keep the money in the local economy and create jobs.

In the paper, William Straus, president of FutureMetrics, says more than 4.3 million northern tier homes that are dependent on heating oil or propane will most likely never get pipeline natural gas or home-delivered compressed natural gas (CNG).  States vary widely in the fuel used for heating. In Illinois, 79.7 percent of homes are on natural gas while in Maine 68.7 percent of homes and businesses use heating oil and only 5 percent on pipeline natural gas. 

Drawing from U.S. Census and Energy Information Administration data, the paper looks at the number of household in northern tier states in rural areas that are not on natural gas, estimating the total at about 6 million. Michigan leads with close to 850,000 households, followed by Ohio and New York with about 700,000 each and Wisconsin at about 525,000. Indiana, Minnesota and Illinois hover around 400,000 households, followed by Iowa with 300,000 and Maine and Oregon at around 250,000 households.

Strauss then overlays U.S. Forest Service inventory data to asses which states could sustainably supply 100 percent of its rural homes with wood pellets for heating, citing  Maine, Oregon, Washington, New Hampshire, Vermont and Pennsylvania as all having sufficient resources to supply households in those states, plus the potential to export to other states. 

The paper delves into price comparisons with competing fuels. “The current retail price for pellet fuel in the New England area is between $200 and $250 per ton,” it says. “CNG is not competitive with pellet fuel at a delivered price equivalent to $376 per ton of pellet fuel.”  And, though natural gas has been economical for those who can get, “there is another natural gas market trend that will support pellets remaining cost competitive for heating,” the report says. “As the U.S. exports more natural, prices will be set by global rather than domestic markets.”

“High efficiency fully automatic pellet fueled boilers, and the bulk pellet fuel delivery trucks to serve them, need to become more commonplace in the U.S. just as they already have in many European countries and some areas in the U.S. Northeast like Maine and New Hampshire,” the paper concludes. To view the complete analysis and all the charts offered click here.