Maine fuel report now includes wood pellets and cord wood

By Luke Geiver | December 07, 2011

For the first time, wood pellets and cord wood have been included in the weekly heating fuel survey produced by the Office of Energy Independence and Security for the State of Maine.

“The governor is very concerned about the state of Maine’s economy and about job growth,” said William Strauss, president of FutureMetrics LLC. “[Gov. Paul LePage and OEIS Director Ken Fletcher] called upon us to help him more fully understand the economic benefits and job creation that converting heating oil to pellet fuel would bring to Maine.” Strauss, along with Les Otten and Dutch Dresser from equipment manufacturer Maine Energy Systems, helped provide the OEIS with information related to the potential of wood pellets used in home heating applications for the state, following LePage’s request.

The addition of wood pellets to the heating fuel survey not only provides more credibility to wood pellet fuel for the state, Strauss said, but it also “clearly shows that wood-pellet-fueled central heating systems have a significantly lower cost of operation than natural gas systems and a huge advantage over heating oil and propane.” The data for the most recent fuel report shows that Strauss’s statements are correct. On Nov. 28, the price of fuel oil converted into million Btu, totaled $26.25 or $3.64 per gallon, the price of propane $34.27 or $3.13 per gallon, the price of natural gas $15.00 or $1.50 per 100 cubic feet, and the price of wood pellets $14.30 per million Btu.

Through a presentation given to the governor titled “Growing Maine’s BioEnergy Future,” Strauss also highlighted several key points that show the potential of wood pellets used for home heating. For a state that ranks No. 1 in heating oil use with over 70 percent of the households using heating oil (only 12.01 percent use wood), the presentation states, “if Maine were to convert 20 percent of its homes from heating oil to locally produced wood pellets used in modern efficient boilers, it would create or sustain about 9,000 permanent and stable jobs.” Those jobs would be in pellet delivery services or from the labor required to produce the fuel supply. If that 20 percent of Maine homes were to convert, it would require 660,000 tons of pellets per year in a state that already has the capacity to produce 290,000 tons of pellets per year. And, the presentation notes, a 20 percent home heating fuel switch would also prevent the state from losing roughly $200 million in export dollars and 12,000 jobs.

For the heating and plumbing installers that would be used to help that 20 percent make the fuel switch, $264 million would be generated if each home purchased a wood-fueled home heating system at $16,000 each. But regardless of any hypothetical fuel switch, Strauss’ presentation also includes several cost comparison charts indicating that wood pellet fuel has been, on average, cheaper than most other fuels such as heating oil, propane, or natural gas since 2004. Since 2004, the only time heating oil has been cheaper than wood pellets was during a stretch from December 2008 to June of 2009. But, as of September 2011, the price disparity between heating oil and wood pellets is the second largest since 2004.

Although Strauss emphasized the cost disparity between wood pellets and other heating options, he pointed to the correlation between job creation and wood pellet fuel as the most important aspect of his presentation to the governor. “The job ‘destruction’ that reliance on imported fossil fuel generates compared to the job ‘creation’ that will accrue from producing the fuel from sustainably managed forests in Maine,” he said, should be the main takeaway.