Friday, February 9, 2018

The wood heater tax credit comes and goes

Labs now test wood and pellet stoves
for efficiency but some manufacturers
ignore those tests and tell consumers
their stove are 75% efficient and
thus qualify for the $300 tax credit.
Dec. 2019 - A federal tax credit had not in been in place for wood or pellet heaters in 2018 and 2019, but in December of 2019 it was made retroactively available back to Jan. 1, 2019 and through Dec. 31, 2020.  Congress stated that stoves needed to be 75% efficient to qualify, but manufacturers have ignored that and claim that almost all stoves qualify.

The Green Act, released by House Democrats in 2018 would have given wood and pellet heaters that are 75% efficient or higher a 30% tax credit, just like solar.  A similar bill in 2019 came very close to passing but didn't.

Feb. 9, 2018 - Today President Trump signed into law a budget deal that included a one year, retroactive extension of the wood heater tax credit for 2017.  Thus, consumers who bought stoves that are presumptively 75% efficient or higher may qualify for a $300 tax credit on their 2017 taxes.  Stoves purchased in 2018 or 2019 are not covered.  Click here for more detail on the 2017 tax credit extension.

Nov. 18, 2016 - Republican leaders on Capitol Hill say they do not intend to consider a tax extenders bill, that could have extended the $300 tax credit for wood and pellet stoves into 2017.  Currently, that credit is set to expire on Dec. 31, 2016.  Next year, a tax reform package could revive a wood and pellet stove tax credit, and make it retroactive to Jan 1, 2016.

Renewable energy and energy efficiency incentives appear less likely under a Trump administration with both houses of Congress controlled by Republicans.  A $300 tax credit for stoves was not significant enough to really tip the scales for that many consumers, and when it did they were just as likely to buy a very low efficiency stove, due to misleading advertising by most stove manufacturers claiming that nearly all of their units are 75% efficient.  This loophole that industry created has diminished support for the stove tax credit among key energy efficiency groups and may reduce its chances of being included in a bill in 2017.

Dec. 18, 2015 - The United States Congress passed a massive omnibus spending bill to fund the government and provide tax breaks to businesses and individuals.  Among them is the $300 tax credit to purchase a wood heating appliance.  The bill extends that credit through Dec. 31, 2016 and is retroactive to Jan. 1, 2015.

In a far more widely anticipated move, Congress extended the 30% tax credit for residential solar PV panels through 2019 and then gradually reduce it.  This credit was set to expire at the end of 2016 and offers that industry a level of support and certainty for strong growth.

For wood and pellet heaters, the bill extends the $300 tax credit, contained in Section 25C of the IRS tax code, which states taxpayers are entitled to a $300 tax credit for the purchase of a wood or pellet heating appliance that is 75% efficient or greater.  Consumers need to obtain a certificate from the manufacturer, stating that the appliance is qualified for the credit.

For consumers who purchased a wood or pellet stove in 2015, or who will do so in 2016, they will likely be entitled to the $300 credit if they have not used up their $500 lifetime maximum credit for energy efficient property. 

Wood and pellet stove manufacturers routinely mislead the public by claiming that virtually every single stove they make is at least 75% efficient, flouting the letter and intent of the law, which was to only qualify stoves at 75% efficiency or higher. As of May 15, 2015 all stoves and boilers certified in the US are tested for efficiency using the CSA B415.1-10 efficiency test.  This efficiency test provides a guideline for how to test and not all stoves will achieve an efficiency of 75%.

“Higher efficiency wood and pellet heaters deserve renewable energy incentives to help American families reduce reliance on fossil fuels and to encourage companies to build higher efficiency appliances,” said John Ackerly, President of the Alliance for Green Heat, an organization that advocates for wood and pellet heating. “In the past, some in industry has made a mockery of this tax credit, misleading tens of thousands of consumers into thinking they are buying higher efficiency stoves.  Its time to start measuring efficiency and reporting it honestly and only qualifying those heaters that are 75% efficient or higher,” Ackerly said.

The Alliance for Green Heat estimates that a third of all wood and pellet stoves could meet the 75% efficiency threshold, giving consumers a wide range of choices.  Appliances that are 75% efficient using the European lower heater value (LHV) are usually between 69 – 71% efficient using the North American higher heating value (HHV).  A leading industry expert, Rick Curkeet concluded in a 2008 letter to an industry trade association that "the intent of the solid fuel appliance incentive program recently enacted by Congress is ... to require a minimum of 69.8% efficiency."

Stove manufacturers are now required to disclose their efficiency and more than a quarter of all EPA certified stoves now have actual, verified efficiencies posted on the list of EPA certified stoves,  A few stove companies, such as Blaze King, Jotul, Kuma, Seraph, Travis, Woodstock Soapstone publicly disclose actual efficiencies of most of their models on the EPA website and almost all of those models appear to qualify for the tax credit.  However, other manufacturers still list one efficiency with the EPA, but maintain another efficiency definition that allows them to claim their stoves are 75% efficient to qualify for the tax credit.

Unlike other heating and cooling appliances, prior to May 2015 wood and pellet heating appliances did not have to test or report efficiencies and there are still few accepted norms on advertising practices.  Websites and promotional materials of many major stove brands contain exaggerated efficiency claims, some of which may come from the company’s internal laboratory, not from a reputable, third party lab.  


  1. While standing on your bully pulpit spouting about "manufacturers misleading tens of thousands of consumers" you have become the leading "misleader". You may not like this 75% LHV value, but using the B4.15 standard, most stoves will pass. The EPA has more information than that from the companies you list. Why they do not post it is a question for them. They have all the data from all the stoves.
    I like to support your efforts, but you are so quick to spout righteous, ill informed nonesense, it is very disappointing. If you want to be a spokesman, at least get your data from somewhere. Stop using words like "might" or "may". If you have data, say it.

  2. It is curious to me how you can stand on your self-righteous bully pulpit claiming that your opinion is data while ignoring actual data. You have knack for it! Congratulations. You may not like that 75% LHV was enacted, it was.
    EPA has all the test data from all listed stoves. If the efficiency was important to them, they could calculate it the same way us evil manufacturers do, with Excel.

    If you ever would like to see this companies spreadsheets; once again, I offer them to you. I do not think the “evil ones” are as willing to lie to the Federal Government as you may think. This company does not, and I do not appreciate your biased accusing words.

    Why some efficiencies are updated on the EPA website and others are not, is a question for EPA. Ours were submitted for the stoves we have data for, a while ago and do not appear.

    Instead of using accusational words like “may” or “might”, get you data right and say “is”.

    1. Dear Dave,

      Thanks for your post. As a manufacturer of stoves, you are in a position of influence and I very much want to clarify a few things.
      1. The Alliance for Green Heat supported a change to 70% efficiency HHV instead of 75% LHV. But equally important is establishing a standard way to test and report. Currently, manufacturers can use many, unofficial ways of testing efficiency. We support a level playing field so that all manufacturers and consumers know how efficiency is being determined.
      2. When test labs send their efficiency data to the EPA prior to May 15, 2015, it was almost always marked CBI - confidential business information. So yes, the EPA has lots of data, but by law they are prevented from releasing it because the labs have a practice of sending everything CBI. We tried to get the EPA to release it, but the companies will not let EPA release. We explain this in detail in this blog.
      3. We are not claiming that your company or others are lying to the Federal Government, but what is happening is that many companies use efficiency calculations that exaggerate their numbers, and they justify it by saying that Congress was not explicit in how they should measure efficiency.
      4. The EPA can only post the efficiency numbers of stoves that specifically request those numbers to be disclosed. If you submitted them and the EPA hasn’t posted them yet, you may need to nudge them and confirm that they were properly submitted. We wrote a blog about this, recognizing and thanking those stove manufacturers who are willing to release their efficiency numbers.
      5. There is a good argument to be made that to get tax-payer subsidies for the purchase of stoves that are 75% efficient or higher, companies should have to publicly release their actual efficiency, like HVAC equipment has to do to get Energy Star qualified. Ultimately, I suspect that Congress and the IRS will want to just refer to the efficiencies posted by the EPA on their list of certified stoves and the list of certified boilers. Then, consumers know they data is provided by a third party lab and the same efficiency calculation was made.
      6. Efficiency data is already required for all boilers, and you can see that many boilers are way below 75% LHV on the EPA boiler list. We assume that boiler companies with third party efficiency numbers under 65% HHV will not claim to be over 75% LHV.

      John Ackerly,
      Alliance for Green Heat

  3. John,

    Carry on. I think AGH meets the highest standards of honesty and integrity in the biocombustion community. If there is nothing to hide, let manufacturers report their efficiency numbers to AGH directly where they will see the light of day.

    Please persist with advocating "real efficiencies" or higher heating value (HHV) efficiencies as opposed to "lobbyist's, legislator's, European, counterfeit, or Lake Wobegon efficiencies" that are based on lower heating value (LHV).

    (Lake Wobegon refers to the fictional home town of Garrison Keillor, host of National Public Radio's popular show, "Prairie Home Companion," where, "all the men are strong, all the women are good looking, and all the children are above average.")

    There are overwhelming compelling reasons to use real efficiency rather than the other one.

    1. It's honest. With LHV efficiency, one can measure values greater than 100%. Like Lake Wobegon's children, that's a logical impossibility.

    2. It's the standard for other fuels. It places biocombustors on the same playing field as other fuel burners like natural gas or oil-fired appliances that are rated by HHV efficiency.

    3. It is scientifically respectable. Counterfeit efficiency is clearly favored by manufacturers who profit from this distortion. Hence, lobbiests have evidently succeeded in convincing legislators who don't know any better to specify it in setting standards despite its lack of scientific rigor and integrity.

    We are all biased in supporting the use of biofuels, but nothing is gained through deception and dishonesty. Thank you for your efforts to support honest and transparency.

    Gael Ulrich, Professor Emeritus of Chemical Engineering and founder of the BioCombustion Institute

  4. John, I can see why you don't normally respond to posts and emails. While "not honest people" like to post on your blog without showing who they are or at least a real way of finding out their real intentions are, I am trying to promote a new design or what I feel is a better combustion design. I have a website ( and am a real person. I also have a kickstarter campaign and would like as many people to visit it and ask questions - as many questions as possible so people understand it. I can be found on facebook, Andrew Murray, owner Round for a Reason LLC and Sand Lake Tree LLC.

    If the above commenters are real, my apologies but if your company makes a square, rectangular or horizontal cylinder stove or furnace, it is not the best technology available. Round for a Reason llc is looking for outside help for improvements and ideas.

    While I tried to get into the stove competition, for some reason I don't get a chance to show what my stove can do.