Thursday, February 23, 2017

Wood and pellet stove prices rise 3% in wake of new EPA regulations

Since the EPA announced stricter emissions regulations for wood and pellet stoves, prices increased by an average of 3% over a two-year period when adjusted for inflation, based on a review of 77 popular stove models. Without inflation, prices increased by an average of 4%.

The Alliance for Green Heat, an independent non-profit focused on the wood and pellet heating sector, tracked retail prices for 77 wood and pellet stoves over a two-year period, from February 2015 to February 2017. The EPA announced new regulations on February 3rd and they took effect on May 15, 2015. Even stricter emission limits are set for 2020 and the Alliance will continue to track prices through 2020 and beyond.

We identified 77 stoves made by 7 popular brands with varying price points: Jotul, Blaze King, Harman, Quadrafire, Woodstock Soapstone, Hearthstone, US Stove, and Englander.

It is impossible to tell how much regulations contributed to the 3% price rise, although each of the 7 brands are going through periods of increased R&D as they work towards complying with the 2020 emission limits. The EPA set a maximum of 7.5 grams an hour in 1990, 4.5 in 2015 and 2.0 or 2.5 grams in 2020. Most stoves already met the 4.5 gram limit in 2015, but most do not meet the 2020 limits. It is possible that some companies are starting to pass those costs along to consumers.

There may be steeper price rises as 2020 approaches and companies have to begin more intensive R&D and certification testing.  However, industry is pushing a bill in Congress to delay the 2020 emission standards to 2023.  The Hearth, Patio & Barbecue Association is also suing the EPA to block the 2020 emission standards for boilers and furnaces, but not necessarily for stoves.  The bill in Congress is partially designed to give the litigation enough time to get through the courts.  

We tracked the retail prices of 59 wood stoves and 18 pellet stoves using the sale or final price of the stove listed on the retailer’s website. Overall, the 59 wood stove retail prices rose an average of 4% ($80) or 3% ($45) when accounting for inflation. The pellet stove category saw a greater average price increase of 5% ($106) or 3% ($66) per stove when accounting for inflation.
  • Four-fifths of the 77 wood and pellet stoves increased in price over the two years. Of these, the average price increase was 6% ($125) or 5% ($90) when adjusting for inflation.
  • About one-fifth of the 77 stoves did not go up in price between February 2015 and 2017. The majority of the Englander and Blaze King models we tracked stayed the same price.
  • Four wood stoves out of 77 wood and pellet stoves -- one Jotul, two Hearthstone, and one US Stove -- declined in price. The average decline was 6% ($250).
The EPA is required by law to do an economic regulatory impact analysis (PDF) and determine if the costs of the regulation outweigh the benefits. The EPA predicted slightly higher retail costs, and as a result, a slight decline in demand for new stoves. However, on balance they estimated that the overall health and other benefits vastly outweigh the costs.

Some commentators, members of Congress and editors claimed the EPA regulations would make wood stove prices rise sharply and be unaffordable for the average American.

The EPA also is required to assess the impact of the regulation on small businesses, since more than 90% of stove manufacturers and retailers are small firms. The U.S. Census Bureau reports that the industry employed 15,911 workers in 2011.

Price changes by brand and stove type

The wood stoves with the highest price decreases, Hearthstone’s Bari 8170 and Lima 8150, which declined in price by $620 and $300 respectively, were the priced the highest of any stove on our list in 2015 at $4,999 and $5,299. No pellet stove we tracked declined in price in 2017 and the only two pellet stoves did not increase in price in 2017 (both Englanders priced between $1,000 and $2,000).

Wood stove price increases ranged from 1% (Hearthstone Castleton 8030 and Craftsbury 8391) to 35% (US Stove’s Large Woodstove). Among the wood stoves that increased in price between 2015 and 2017, the average increase was around $125 or 6% more than the 2015 price. Seven of the nine pellet stoves that rose in price increased by an even $100, regardless of their 2015 price, which represented a 3-4% increase. All five of the Harman pellet stoves, which retailed between $2,999 and $3,999 retail in 2015, were listed $100 higher by the same retailer in 2017.

For the sake of consistency, we only used stove prices at one or at most two retailers per brand. We used final or sale prices rather than “suggested retail price” or “regular price” when given. The number of stoves we selected per brand varied based on the number of models available in 2015 and the number of models that continued to be sold by that retailer in 2017.

Englander and US Stove had some of the lowest prices stoves we began tracking in 2015, with a median price of about $1,000. At about the middle were the brands Woodstock Soapstone (median price of $2,400), Quadrafire ($2,550), and Jotul ($2,700). The more expensive stove brands included our study, based on median prices, were Hearthstone ($2,900), Blaze King ($2,950), and Harman ($3,000).

Four out of five Blaze King stoves, three out of four Englander wood stoves and all (two) Englander pellet stoves did not increase in price over these two years. The sixteen Hearthstone wood and pellet stoves we tracked declined in price by an average of 1% ($3.75) per stove, thanks in great part to large drop in price for two of the brand’s priciest ($5,000+) wood stoves.

As for the brands that increased their prices, Jotul’s 19 wood stoves increased by an average of 3% ($79) each. Quadrafire’s and Harman’s wood and pellet stoves both increased by an average of 4% each ($101 for Quadrafire, $122 for Harman). Harman’s wood and pellet stoves increased in price by an average of $122 per stove. US Stove and Woodstock Soapstone had the greatest average price increases of any brand at 15% each (Woodstock Soapstone has frequent sales which we did not take into account). US Stove’s stove prices increased by an average of $155 per stove and Woodstock Soapstone’s increased by an average of $408 per stove.

The EPA regulations had a much larger impact on prices on companies making unregulated outdoor wood boilers and unregulated wood furnaces.  Prices for boilers rose at a sharper rate than stoves, although we did not track those prices and cannot offer any estimates.

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