Wood Pellet Prices
Farm and building supply stores provide forty pound packages of wood pellets for retail buying. However, for industrial purposes wood pellets must be bought and stored in bulk. You may find their list on page 24. As a rule, the trade-price usually consists of a per-load fee based on the point of delivery.
Saving of fuel expense by switching to wood pellets can be calculated in the following way: to make our calculation exact, we must take into account that all fuels differ in structure and their units of measurement are different too. That is why the most efficient mode of comparing their price is to compare the amount of energy produced by them in millions of British thermal units. One of the most important factors here is the production cost of one MMBtu of each fuel. Among other factors influencing the price we should mention the efficiency of the heating system and the content of energy and moisture in each fuel;
Wood pellets equals…
- 120 gallons of heating oil
- 170 gallons of propane
- 16,000 ft3 of natural gas
- 4,775 kilowatt hours (kWh) electricity
For pellets
- $1.67 per gallon for heating oil
- $1.18 per gallon for propane
- $12.50 per (1,000 ft3) for natural gas
- $0.04 per kWh for electricity
So, we can see that 120 gallons of oil and one ton of pellets produce the same amount of heat and the conclusion from this is that one gallon of heating oil bought at the price of $1.67 can be cost-effectively substituted by one ton of wood pellets, whose price is $200 per ton.
Now, you can compare your current fuel price and its equivalent, if you were using the wood pellets. The higher is your heating oil price, the more you will save by converting to the wood pellet fuel during the year. If you pay $2.30 per gallon of oil, you will save $.63 per gallon. This is the price difference between $2.30 and $1.67, or 27 percent, representing a yearly savings of $2,700 on a $10,000 annual fuel bill. All in all, using wood pellet fuel can be defined as more cost-effective than using fossil fuels for according to our example all fuel prices are higher, all but one.
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