...but at $4.50 it is about the price of electricity, which would seem to put a serious dent in the tendency of people to use it!
What amazes me is that so many households leave the heat set at 70+* F all winter long. Granted, prices weren’t as high over the past winter as they are today, but I’m still surprised the general population didn’t turn the thermostat down much last winter given the elevated oil prices. Even if oil is $5 a gallon next winter, a substantial number of households will still have the heat cranked up (and bitch about oil prices). The ones that can’t afford it might even “rough it” and turn it down to 67* F. Does the entire house need to be this warm? Does any of the house need to be this warm? When burning oil only, we leave our house set at 60* all winter long. Yes, it’s a little chilly when you get out of bed or the shower, but once you throw some cloths on it’s not bad at all.
So while I feel for the people that can’t afford $4.50 oil, I don’t have any sympathy for the folks who use 1500+ gallons a year to keep their home 70+* all winter long… Can’t afford the oil? Buy a sweatshirt!
No one can guess whether a pellet boilers makes economic sense. To do so you’d have to know the price of pellets well into the future, as well as the price of LP (an alternative fuel) as well as oil...for years ahead.
You’’d also have to know the installation cost as well as the service, etc. for the Pellet boiler.
In a general sense, it is not financially prudent to react to ANY short term situation by spending 10K+ on a aux. heating system. Just because the power goes out for a couple days does not mean I will buy a 20K backup generator, etc.
I would not sell the pickup (I don’t have one anyway) just because of a bubble in gas prices.
There are always early adopters and that is fine, but they are often left holding the bag. If the payback is so great and so fast, it would be just as well to wait a year or two and then change. Example: I called about getting PV Solar installed. The people never showed up. I emailed and they said they were busy meeting demand........translation: I’ll get a much better deal by waiting!
The installation, boiler, burner, hopper, etc costs, including the cost for removing a preexisting oil heat system, should run in the 12.5-13k range. However, installation costs are reduced dramatically when you use your oil system and boiler in series (~$10k). This also has the added benefit of REALLY, REALLY, REALLY long showers, as well as a heating backup in case one or the other fuel is used up. Also, when your relatively unreliable oil burner breaks, you have a heating solution that can keep you warm for months instead of hours.
The price of pellets will be stable for several years. MEsys has a relatively large amount of money, and I’m sure they have a contract for their entire projected winter fuel needs. Also, I heard that someone was purchasing multiple pellet mills at the Hearth, Patio, and Barbecue Expo, so I wouldn’t worry too much about the stability of pellet prices. Europe has plenty of pellet production, it’s just cheaper over here due to the difference between the dollar and the euro. Maine’s forest industry is doing terribly right now, and a chance to let them run their machines and actually turn a profit will drive an increase in production capacity.
From what I hear, half a year (4 ton delivery) of fuel is going to cost about a grand, meaning a 2k (plus or minus $100) total cost for your winter’s fuel.
The cost of pellets in Maine has risen at a 8-10% range over the past three years and three new mills have opened or will open within the next two weeks. The cost for oil, LP and Propane will continue to increase due to the costs of transportation (mainly from the Middle East or Africa) and the increased influx of cash into the commodities market. The price may moderate somewhat but the concensus is that prices will never reach $2/gallon again for heating fuel. This means the cost for heating your home with pellets or wood will ALWAYS be cheaper than that of oil from now on.
Also with the strength of the dollar falling, the correct time to purchase a “replacement system” is as soon as you can financially afford it. I do not agree with the analogy of a $20k backup generator system when the power goes out but when it will cost over $1000/tank for a fill up of oil and it may only cost me $2400-2800 for the heating season for pellets, I’d be a fool to not try to protect my family from the short term and long term consequences of not preparing when I could.
I don’t hsve a crystal ball to tell the exact future but the likelyhood of increases in pricing for oil with the worldwide demand going up nearly 1% per week is nearly certain. Worldwide production of oil has actually not kept up with the increase in demand for the first quarter of the year (1st time in history) falling to 99.87% of demand. Stockpiles of oil in the oil producing nations made up the difference but won’t last forever. Preparing when there is not a crisis is nearly always less expensive (and usually is possible) while after the actual shoe drops “a man can be sure of nothing”.
Also, when your relatively unreliable oil burner breaks, you have a heating solution that can keep you warm for months instead of hours.
The price of pellets will be stable for several years. MEsys has a relatively large amount of money, and I’m sure they have a contract for their entire projected winter fuel needs. Also, I heard that someone was purchasing multiple pellet mills at the Hearth, Patio, and Barbecue Expo, so I wouldn’t worry too much about the stability of pellet prices. Europe has plenty of pellet production, it’s just cheaper over here due to the difference between the dollar and the euro. Maine’s forest industry is doing terribly right now, and a chance to let them run their machines and actually turn a profit will drive an increase in production capacity.
From what I hear, half a year (4 ton delivery) of fuel is going to cost about a grand, meaning a 2k (plus or minus $100) total cost for your winter’s fuel.
Relatively unreliable oil burner? What makes you think a pellet furnace is going to be reliable ?
And what crystal ball are you viewing that makes you not think the price of pellets are stable?
John
The price of pellets will be stable for several years. .
That is a total guess....but thanks for your opinion!
As to unreliability of oil burners, I would put ANY money on the fact that Pellet appliances are vastly.....VASTLY less reliable. I have seen many oil furnaces and boilers 30-50 years old and older, while even Pellet stove dealers here have used 10-12 years as their guess on Pellet stove life. Sure, they may last longer, but certainly it will be a long time before they reach the reliability and yearly service cost (low) of oil equipment.
It never fails - during any energy crisis (I have seen this since 1972), people will come out of the wood work and be willing to make ANY claims so they can make money. But make no mistake about it, the profit motive does not always offer the customer (end user) a fair shake.
Again, I am not positioning myself against pellet boilers, but only looking at recent history. A lot of people bought corn stoves and furnaces in the last 3 years and now are stuck with corn at twice the price or more. We saw $320+ pellets just 18 months ago. We 100% KNOW that if Pellet makers get a better price by shipping them to Europe and elsewhere...they will.
So my advice is simply for folks to sit back and study all the issues and trends. The exception, obviously, is the early adopters and those with plenty of cash where it really does not matter as much.
Also, when your relatively unreliable oil burner breaks, you have a heating solution that can keep you warm for months instead of hours.
The price of pellets will be stable for several years. MEsys has a relatively large amount of money, and I’m sure they have a contract for their entire projected winter fuel needs. Also, I heard that someone was purchasing multiple pellet mills at the Hearth, Patio, and Barbecue Expo, so I wouldn’t worry too much about the stability of pellet prices. Europe has plenty of pellet production, it’s just cheaper over here due to the difference between the dollar and the euro. Maine’s forest industry is doing terribly right now, and a chance to let them run their machines and actually turn a profit will drive an increase in production capacity.
From what I hear, half a year (4 ton delivery) of fuel is going to cost about a grand, meaning a 2k (plus or minus $100) total cost for your winter’s fuel.
Relatively unreliable oil burner? What makes you think a pellet furnace is going to be reliable ?
And what crystal ball are you viewing that makes you not think the price of pellets are stable?
John
If your pellet burning system is automated, then yes, it’s much more reliable than oil heat. If you have a cheap $3k pellet burner/boiler that you have to refill with 40lb bags, then no, you’ll have to clean it, scrape it, remove the ashes, and lug around your pellets, and it will only be as reliable as you are.
Maine and the surrounding area has a flagging timber business that’s just waiting for some demand. Multiple pellet mills have been purchased in the area, and pre-existing domestic pellet production is so high they have to export it anyway. With several pellet mills coming online that will dramatically increase pellet production in the area (think 2x or 3x the pellet production capacity we have now) and flat pellet demand the price of pellets should either plummet or stabilize (in a perfect free market )
Now, if Germany, Norway, Austria, and Sweden suddenly found themselves without any trees, we might see a spike in pellet prices. As it stands, they’re importing from the US because the dollar sucks, not because they can’t make them over there.
Edit:
As to your corn comparison, corn is something that is not only being used for fuel, food, feed, and furniture, but is also something that must be produced in a field. You have to water it, tend it, fertilize it, keep it safe from pests, and harvest it. Corn does not occur naturally in thousands and thousands of hectares across North America. Trees are much easier to maintain than corn. Corn prices spiked because there is much less unused market capacity, whereas the timber industry is not doing as well as it could and there is plenty of out-of-work labor in foresting towns.
Also, when your relatively unreliable oil burner breaks, you have a heating solution that can keep you warm for months instead of hours.
The price of pellets will be stable for several years. MEsys has a relatively large amount of money, and I’m sure they have a contract for their entire projected winter fuel needs. Also, I heard that someone was purchasing multiple pellet mills at the Hearth, Patio, and Barbecue Expo, so I wouldn’t worry too much about the stability of pellet prices. Europe has plenty of pellet production, it’s just cheaper over here due to the difference between the dollar and the euro. Maine’s forest industry is doing terribly right now, and a chance to let them run their machines and actually turn a profit will drive an increase in production capacity.
From what I hear, half a year (4 ton delivery) of fuel is going to cost about a grand, meaning a 2k (plus or minus $100) total cost for your winter’s fuel.
Relatively unreliable oil burner? What makes you think a pellet furnace is going to be reliable ?
And what crystal ball are you viewing that makes you not think the price of pellets are stable?
John
If your pellet burning system is automated, then yes, it’s much more reliable than oil heat. If you have a cheap $3k pellet burner/boiler that you have to refill with 40lb bags, then no, you’ll have to clean it, scrape it, remove the ashes, and lug around your pellets, and it will only be as reliable as you are.
I too am going to have to call BS on any pellet burner being more reliable than an oil burner. Just look at the moving parts of the pellet burner, the byproduct buildup, and the complexity of the unit itself (and associated storage/feed system)… it doesn’t take a rocket scientist to see the oil burner should be more reliable.
Regarding pellet prices, I don’t think anyone can accurately say what oil prices or pellet prices will be a year or more from now. My guess is both will be volatile in the come years. You have to keep in mind, pellet prices still rely on petroleum in manufacturing, packaging, and transportation, so if oil goes up, pellets will also to some degree.
The overall impact of oil prices on pellet prices will be far smaller than the price impact on oil prices....The percentage of increase directly related to the price of oil is far less of an impact on the user of oil in production than for a user of oil (as the end user).
The price of pellets in the State of Maine appears to be headed in the right direction currently (stable or possible decreases due to competion) and that has the largest impact on my family. With a resource that is locally produced, I feel far more comfortable than the thought of relying on oil extracted around the world maintaining a constant (yet extremely high) price. I am not removing my current oil boiler, just putting it in a state of suspended animation for the near future.
The winter will come and I will have heat for my family as long as I have a small amount of electricity to circulate the water from the boiler and maintain the feed supply. I need a total of 300watts more for my pellet boiler than for my oil heat...a fair trade for the cost of the BTU’s produced.
Sorry, Pellet Owner, having been in the HVAC business including the design and importation of equipment from Europe, Canada and elsewhere.....you are entitled to your opinion, but to say that ANY pellet boiler is more reliable than an oil burner is misleading. Very misleading. When you show me MILLIONS of automated pellet boilers in the field over a couple decades, then you will have a leg to stand on. Until then, you have your opinion.
As to Pellet pricing....same deal. You and I have no idea if there will all of a sudden be a world demand for US Paper (due to cheap dollar), or wood for building materials, furniture, etc.
Being as we have seen the price of pellets range fro $150 a ton to $375 a ton in the last 24 months, it is very hard to even guess what the future price will be. I certainly hope they stay low and stable. But I would not bet on it!
And that is just the point. If my mother lived in Maine and had to go borrow money to spend 13K on a Pellet boiler so that she could save $1200 a year, I would go a lot of research before telling her to do so. Would 13K spent in new insulation, windows and other systems save her as much or more? Would a low cost switch to LP (which is cheaper than oil now in most places) save her something? Any capital purchase of that size requires more than the “fear factor” in my opinion.
I applaud the fact that more and more biomass boilers and furnaces will be available soon. However, those entering this market from the sales or importing end should have a long term plan for making market penetration (and money) and sometimes the WORST thing that can happen is a bunch of people jumping into things before the entire situation ( service, parts, fuel supplies, reliability, etc.) is worked out.
You create this wonderful blog devoted to wood burning, expand it to include pellets and presumably all things biomass, and then predict future pricing of pellets is likely to rise faster than oil (which you predict will decline after this bubble is over), and recommend that people convert to LP rather than biomass systems? You’ve got me very confused about your intentions.
Your pellet angst seems primarily directed towards the Maine Energy Systems (MeSys) attempt to do boilers in Maine in a big way. Is it simply the size of this venture that has you apprehensive? There has been much discussion about the price tag being $12,000 or more. MeSys chose to advertise what they feel to be a relatively conservative INSTALLED cost and now everyone says their system is way overpriced. Well, as I stated earlier in this thread the boiler equipment cost is just over $8,000 and a few people have pointed out a couple of other pellet boiler units priced under $7,000 - so can we agree that the cost of the MeSys equipment is not out of line with other pellet boiler options?
Your next biggest concern seems to be new foreign (european) equipment and no one to stand behind it - you say you would prefer the independant route. However, you seem to have a preference for the european boilers - just not the Bosch/Janfire unit from MeSys - so that leaves you with Tarm as the one proven commodity with a track record (and it costs $11k for the equipment). Or you can look at other “independent” european units that are coming to America in lots of 5 on ships every couple months and you have to buy it from the one dealer in “your region” that happens to be 500 miles away. MeSys wants/plans to install thousands of systems and will need a large number of local trained service and install technicians. So perhaps you being in the HVAC business will be fine tinkering with your independant unit when it goes on the fritz but I don’t think other less skilled homeowners would benefit from that approach.
If you and your mother in Maine decide that a 10 year ROI is too long, that is fine by me - that is up to the individual. If going to pellets will only save her $1200/year, were you serious when you suggested her return on investment would be better if she invested in better insulation for her house? I think that is a pretty misleading suggestion.
So I keep asking myself, why is he so opposed to pellet boilers (or at least the MeSys boiler plan)? You start a blog presumably to educate people to biomass heating, Les Otten comes along with a visionary idea to try and open up this option to a much larger group of people and you oppose his idea. I just don’t understand??
Uh, my intentions are always very clear. I work for the customer!
I hope everyone make a million bucks...in one day if possible.....but not at the expense of someone who cannot afford it!
No doubt there needs to be early adopters. I don’t know who MeSysor or anyone else is....just speaking from experience and math.
What you may be surprised at is that I am not a pimp for the industry and manufacturers. I lived through the first pellet boom and saw tens of thousands of customers fork over hard earned money for stoves that were defective and not stood behind. What do you have to say about that?
In the end, I actually DO pimp for the industry and manufacturers since if they took the long term (and quality) view, it would benefit the entire market - makers, retailers and end users. I certainly applaud any efforts by business and government to further the use of clean biomass. But when folks start making statements about better reliability than oil, two year paybacks and stable prices for pellets (given the recent history), my BS meter goes up.
A ten year ROI is certainly a long time for most people. You will not replace 10% of boilers in Maine given such a scenario (my opinion, of course). With inflation and interest rates likely to rise, and the credit crunch, the cost for that 10-12K initial investment can be $800 to $1000 a year in interest alone.
In terms of the brand names, I love ‘em all....well, except the idea of throwing pellets and coal into batch fed boilers! Harman are very well known.....but I think anyone who studies the field will see that Euro models have evolved further than most domestic brands and are also subject to more efficiency and “build” standards. That is a good thing. But if the demand is there, it will not take long for the Domestic makers to produce better units.
So, it is all good. I think products should be sold on their honest merits. We have had this discussion here many times before and even some industry insiders have agreed that pellet central heating is a tough ROI expect in those homes which use a LOT of heat. There are many other reasons to go biomass...of course. Local availability, renewable, etc.
In summary, I am certainly not saying that folks should not buy a biomass boiler! BUT, if a person is doing so for the savings of $$ as the primary reason, the purchase will take some research to assure that- without rose colored glasses - that the payback will be there.
Noticed that some of the advertisers at the bottom of the page are software used specifically in Oil Futures trading.....?? I also notice that the ads are balanced by sites used for purchasing pellets, stoves, etc.
Futures trading is the one specific thing that has been responsible for the dramatic upswing in the per barrel price for oil. More than production, more than problems in the Middle East more than any other factor. I understand the desire to make money in the market but the individual trader in oil futures should understand they are a part of the oil price problem and should at least understand the rammifications of bidding up the prices by dumping their money into the market.
On the other side of the coin, I am really enjoying the lively banter of the other “posters” on this site freely supplying people such as myself with years of information gleaned from hands-on experience in the bio-mass heating scene. I am going to be installing a pellet boiler (or boiler stove) in parallel with my current oil boiler to even out some of the spikes in the price of heating. Based on the posts to this site, I have narrowed my search and learned a few of the possible pitfalls of pellets but now feel much more confident of my decision to buy an “alternative” heat source in these uncertain times.
Most ads on the forum are placed there automatically by google. Our discussions have probably put the proper keywords in, so those ads show up....heck, they probably pay well. I get a % of the revenue from the ads (only when you click on them).
Oil is down almost $8 since we started this conversation. Just a blip? Maybe......but when everyone is crowing (and then betting) that oil is gonna get cheaper, people stop speculating as much. If Heating oil goes down to $3.00 (not likely, but possible), I’d certainly tell people to lock in and stock up.
Glad you learned something. I understand that we tend to play devils advocate, but that is a side of the equation that is good to consider.....and you are unlikely to hear it from sales folks. Good luck in your quest and let us know which unit you come up with. Hopefully, cheaper oil will be tagged along with a stronger dollar and Euro equipment may come down in price! It used to be that the imported stuff was the same price or less than the domestic brands.
Fuel oil delivery as of today is $4.399 per gal. here in western Ma. (Pittsfield) and that`s the lowest price available. The high is $4.68 per gal.
Crude might be down $8 but we might not ever see it .
I`m actually thinking of another stove and chimney on the main floor to nearly eliminate the oil I buy.
And I can forsee the possibility of not heating the finished basement in the future and getting by with a pellet stove on the main floor. I could live with that if I have to.
Maybe even restore some of the (former) electric heat in rooms that would need minimal or occasional heat.
Only have to move my computer upstairs .
Drastic times call for drastic measures. Heh, heh , heh.
Really now, As a youngster (1950s) I can recall having to cut firewood in the summer to burn in the coal furnace in the late fall before it got cold enough to burn coal safely and efficiently and never having much if any heat in the bedrooms all winter. Still that old coal furnace in the cellar was a luxury back then.
But I can go back even further to the 40s to our other home and recall our weekly baths in front of the old kitchen cook stove, wood, coal , oil ? Can`t remember what combination it was but it had a side heater of some sort in it. We also had an kerosene stove (vented space heater) in the living room. I can recall the white kerosene cans placed upside down behind the stove
glug,glug,glugging periodically as it slowly fed into the pot burner that needed it`s dual wicks trimmed occasionally. There was a 50 gal oil/kerosene drum outside near the porch door setting atop a pair of cross bucks and I assume it was filled on a regular basis. Let`s see now, 50 gals at maybe .10 per gal or less was possible because I do remember oil at .14 a gal in the mid to late 50s.
There was no heat in the bedrooms for sure but I never remember being cold however I remember like it was yesterday having my fathers WWI long woolen brown Army coat on top of me to keep me warm. How I loved that old coat. How I loved my father. It had my fathers smell to it or at least I imagined it.
It seems some of us might be destined to return to the old space heater scenario and maybe that`s not a bad thing either since we have become far too accustomed to the excesses and waste of the modern lives we live.
John
Fuel oil delivery as of today is $4.399 per gal. here in western Ma. (Pittsfield) and that`s the lowest price available.
Crude might be down $8 but we probably won`t see it .
I`m actually thinking of another stove and chimney on the main floor to nearly eliminate the oil I buy.
And I can forsee the possibility of not heating the finished basement in the future and getting by with a pellet stove on the main floor. I could live with that if I have to.
Maybe even restore some of the (former) electric heat in rooms that would need minimal or occasional heat.
Only have to move my computer upstairs .
Drastic times call for drastic measures. Heh, heh , heh.
Really now, As a youngster (1950s) I can recall having to cut firewood in the summer to burn in the coal furnace in the late fall before it got cold enough to burn coal safely and efficiently and never having much if any heat in the bedrooms all winter. Still that old coal furnace in the cellar was a luxury back then.
But I can go back even further to the 40s to our other home and recall our weekly baths in front of the old kitchen cook stove, wood, coal , oil ? Can`t remember what combination it was but it had a side heater of some sort in it. We also had an kerosene stove (vented space heater) in the living room. I can recall the white kerosene cans placed upside down behind the stove
glug,glug,glugging periodically as it slowly fed into the pot burner that needed it`s dual wicks trimmed occasionally. There was a 50 gal oil/kerosene drum outside near the porch door setting atop a pair of cross bucks and I assume it was filled on a regular basis. Let`s see now, 50 gals at maybe .10 per gal or less was possible because I do remember oil at .14 a gal in the mid to late 50s.
There was no heat in the bedrooms for sure but I never remember being cold however I remember like it was yesterday having my fathers WWI long woolen brown Army coat on top of me to keep me warm. How I loved that old coat. How I loved my father. It had my fathers smell to it or at least I imagined it.
It seems some of us might be destined to return to the old space heater scenario and maybe that`s not a bad thing either since we have become far too accustomed to the excesses and waste of the modern lives we live.
John
I am waiting on the details from the tech rep for 3 seperate models of boiler stoves to let me know the specifics on running in the US (60 Hz rather than 50Hz). The models are the ECOTHERM H2O 34 (34 Kw total 15% to room and 85% to the water - cost 7100 to get here but it is great to look at in our living room and would add more than my maximum heat load to my existing setup), the Artel 14 Boiler stove (14 Kw 5% to the room and 95% to the water but if I add storage it should supply nearly all my heating needs with the exception of the coldest days below Zero F), the last one is actually a series, MCZ makes several models of Pellet boiler stoves which could meet my needs as well.
The Artel rep just responded, it will operate fine on 60Hz and the total cost of getting the stove here is $7094.60 - a lot of money but it vents through the wall, is located in living space and would meet my heat and hot water needs for 350 days per year. I need to get a bit more info on the other stoves before I jump.
