Wood and pellet appliance sales surge amid demographic heating changes

Fuel prices, extreme weather & heat pumps driving changes

By John Ackerly & Caroline Solomon

 

With rising gas, oil and electricity prices, wood and pellet stove manufacturers are struggling to keep up with a demand not seen in more than a decade. In Europe, demand for stoves is even larger, with lines forming outside hearth stores in hopes of getting one installed before the next heating season.

 

This recent surge comes on the heels of major demographic shifts already underway in wood and pellet heating in America. Households in southern states are retiring old stoves and not buying as many new ones, while in many northern states, demand has been surging. And while wood and pellet stoves are far more dominant in rural areas, there has been significant growth in some urban areas in recent decades. 

 

From 2000 to 2020, the number of U.S. homes using wood and pellets as a primary heating fuel grew very slightly, from 1.68% in 2000 to 1.70% in 2020, based on U.S. Census data. In real numbers, that means 2,075,845 households are using wood or pellets as a primary fuel. An additional 8 to 9 million homes use wood or pellets as a secondary heat source, making it the most popular secondary heating fuel after electricity. (The US Census gathered this data in 2000 and 2020 by asking the following question: “Which FUEL is used MOST for heating this house, apartment, or mobile home?”) 

However, this national data obscures some important local and regional trends. In some urban areas, wood heating is growing rapidly, while in some states it is falling rapidly. This is one of the first analyses based on US Census data to identify these trends in wood heat, which have been playing out over the last 20 years.  

Nationally, electricity continues its ascent and will likely become the most common heating fuel by 2030, if not before. In 1940, when the US Census began tracking heating fuel, wood was the second most common household heating source after coal. Wood heat steadily dropped, bottoming out in 1970 at 1.3% of homes, and then peaking at 3.9% in 1990. Primary wood and pellet heat could see a dramatic rise again if oil and gas prices stay high, for example going from 1.7% of homes back to 2.5% or even 3%, but that would still barely register on national graphs like the one above.

 

Overall, the only sources of heating that are rising between 2000 and 2020 are electricity, solar and wood, although wood only had a tiny rise. Fuel oil, propane, coal and gas all fell. 

Based on US Census Data. Compiled by the Alliance for Green Heat.

Urban vs. rural wood heat trends

 

On average, urban areas in the US saw an increase of 7.05% in wood heat, while rural areas saw an increase of 5.58%. But in 3 states, the number of homes using wood or pellets in urban areas more than doubled, and nearly doubled in 2 other states.  

Based on US Census Data. Compiled by the Alliance for Green Heat.

Michigan and Pennsylvania are both in the top 5 states for wood heating growth in urban and rural areas. Interestingly, the fastest growth in rural areas is not in the states where wood heating is most common. It’s important to note that the rapid increase in wood heat in some states does not always correlate with stove sales. One possible explanation is that many homes that used their stoves as a secondary heater in 2000 are using it as a primary heater in 2020. 

 

For the Northeast and Midwest, the urban change is much higher than the rural change; and in the South, urban wood heat usage is decreasing at a slower rate than rural wood heat usage. The West is the only region in which urban wood heat usage is falling more quickly than rural usage. 

 

But wood and pellet heating remains mainly a rural phenomenon. About four times the number of homes heat primarily with wood or pellets in rural areas than they do in urban areas. As a percentage, in 2020 less than half a percent of urban homes heat with wood but nearly 7% of rural ones do. 

 

More than 80% of Americans live in areas classified as “urban” by the US Census, which includes thousands of towns and suburban areas around cities. In 2010, Census data found 57% of households who primarily heat with wood live in rural areas, 40% in suburban areas and only 3% in urban areas.

 

The growth of wood heat in urban areas may reflect a much faster growth of pellet stoves, compared to wood stoves. In some states, hearth retailers sell more pellet stoves than wood stoves. Nationally, experts often say that about a one quarter to one third of all stove sales are pellet stoves, but there is no reliable data indicating exact percentages or where they are installed. Some urban areas, in addition to areas that experience frequent weather inversions, are beginning to ban the new installation of wood fireplaces and wood stoves. This is an effective way to ensure wood smoke does not get much worse where wood stoves are already common. For the smoke issues that do remain in more urban areas, wood smoke is primarily driven by outdoor fire pits, chimmneys and fireplaces.

In one of the only academic studies of U.S. wood heating trends published in 2012, the authors identified changes in wages and other energy prices as key drivers of demographic shifts in wood heat usage. That study, Analysis of U.S. residential wood energy consumption: 1967–2009, is an excellent overview of many factors impacting wood heat, and was done at the end of a 4-decade period of gradual decline in wood heat. This was before wood heat began trending up in 2000, ending its decades-long decline. 

Little research has been done in recent years on wood and pellet heat usage in urban and rural areas. One of the very few comprehensive analyses of U.S. wood heat usage, a report from 2012, called its lack of a breakdown of urban vs. rural wood heat as a “shortcoming” that was due to a “lack of time series data corresponding to urban/rural areas.” 

 

State and regional wood and pellet heat trends 

 

The states with the highest percentage of homes using wood or pellets as a primary heating fuel have remained relatively steady over the years. New Mexico was ranked sixth in 2010, quickly rose to third place in 2019, and then dropped back to fourth in 2020. One potential reason there could be more rapid changes in primary heating with wood and pellets is that a stove can be a primary heater one year and a secondary heater the next, which is usually not the case with central heating systems using oil, gas or electricity for fuel.

Based on US Census data. Compiled by the Alliance for Green Heat.

Many states experienced dramatic increases in wood heat usage from 2000 to 2020, while others saw declines in wood heat. The majority of the states which saw an increase in wood heat were not in New England and the Pacific Northwest where it is most popular, but in second tier states a bit further south. States where wood heat dropped the most are the warmest, southernmost states in the country.

 

Based on US Census Data. Compiled by the Alliance for Green Heat.

Aggregating by region, the general trend seen with states located in northern vs. southern regions holds. The two regions that saw increases in wood heat were the Northeast (+51.05%) and the Midwest (+27.73%), while the South and the West both saw overall decreases (-28.31% and -9.94%, respectively). 

Based on US Census Data. Compiled by the Alliance for Green Heat.

 

Selected state graphs

 

The residential heating mix in each state tells a different story over the years and presents different challenges to lowering the greenhouse gas intensity of heating fuel.

Wood and pellet heating has typically been the second most common primary heating fuel in Maine after oil. Wood did not prove to be any more popular in Maine in 1970 than it did in the rest of the country, but when heating oil costs rose, wood heating bounced back in a much dramatic way.

Wood heating in Washington state closely parallels Maine, starting at over 50%, diving to under 2% in 1970 and then rebounding in 1990. Electricity, however, has been extremely popular in Washington, probably due to milder winters, and local, cheaper hydroelectricity.

One of the largest, unknown stories about wood heat is that it was far more popular in the south in the 1950s, 60s and 70s than the rest of the country, including New England. This was largely because many rural Black communities were not included in gas or electricity infrastructure projects that enabled wealthier communities to get off wood and coal. Many households that rely on wood heat to this day do so not out of choice but out of necessity, and represent a significant, though little-noticed, energy justice issue.

 

Policy considerations

 

The rapid rise of wood heat presents a number of policy considerations that are frequently overlooked. Wood and pellet heating is often seen more of a public health nuisance in some circles, an energy lifeline in others, and a solution to shed fossil fuels in others. All of these narratives are valid and must be balanced at the local, state and federal level. 

 

Lack of understanding of the issues is a major barrier, as many policymakers and organizations often confound the issue of burning industrial pellets to make electricity with the sustainable use of premium pellets for local heat. And many still assume wood heat primarily involves cutting live trees, instead of sourcing wood that is already down or dead and has no other use. There is little awareness that pellet heat is consistently far cleaner than cord wood heat. Finally, there is still a lack of awareness that wood smoke, which may smell good to many people, is a serious health issue. 

 

If utilizing the cleanest and most modern wood and pellet heating to reduce fossil fuel use was the goal, federal and state governments could focus tax incentives and rebates on pellet stoves and boilers, as some states already do. Already in Vermont and other areas, the high rate of wood and pellet heat reduces stress on the grid during winter peak load periods, which are likely to get worse as more of our energy needs are electrified. If the federal government wanted to support rural low-income families to utilize free local wood, it could drastically increase its R&D funding to jumpstart the production of automated wood stoves that use computer chips to regulate air supply and prevent smoldering.

 

We can expect some cities and states to restrict new installations of wood heaters in densely inhabited areas and others to expand modern, automated heat at the commercial and residential level. Such outcomes are not inconsistent but require more educated debate among policymakers and the public. Already some of these policies are helping to shape the rise and fall of wood and pellet heat across America, but are likely a small influence compared to market forces. 

 

Conclusion

 

While wood and pellet heating has changed little in the last 20 years at the national level, regional and state changes have been significant. At a national level, studies show that reductions in household size, growth in heated floor area per house, and increased access to space cooling are the main drivers of increases in energy and GHG emissions after population growth. Improved generation efficiency and decarbonization of electricity supply are bringing about GHG emission reductions. Wood and pellet heat may be on the rise again, meaning it could factor more into national discussions of energy security and decarbonization.

 

This paper looks at the size of primary wood and pellet heating at the national and state level, but the role of secondary wood and pellet heating is equally, if not more, important in terms of sheer BTU output and reductions in fossil fuels.  Similar challenges of understanding, guiding and managing the pros and cons of wood heat are emerging across the northern and southern hemisphere and particularly in Europe, where the energy implications of Russian’s invasion of Ukraine are most acute. 

 

The next 20 years will likely see an even more rapid shift in residential heating fuel, as climate change becomes a more urgent issue. Electrification is emerging as the dominant, most obvious solution to home heating but wood and pellet heating may emerge as larger factor in the Northeast region and in various other states.

 

Further Reading

Households heating with wood or pellets declined by nearly 10% between 2011 and 2016 (AGH, 2018)

Increase in wood as main source of household heating most notable in the Northeast (EIA, 2014)

More than 30% of homes heated with wood in some counties (US Census, 2018)

Gas stoves and fireplaces appliances need better regulation and transparent efficiencies

Public comment from the Alliance for Green Heat 

April 8, 2022

RE: Docket Number EERE-2021-BT-DET-0034: Notice of Proposed Determination of Miscellaneous Gas Products as a Covered Consumer Product

Thank you for the opportunity to comment on miscellaneous gas products as a covered consumer product. 87 Fed. Reg. 6786 (February 7, 2022).

In the United States, efficiencies of gas stoves are often unavailable, and it can be very confusing. The only reliable database is maintained by the Canadian government and consumers often do not know to check it, even if they want a more efficient appliance. Consumers who are trying to save on heating bills often use their gas stove or fireplace to heat the core of the house instead of using the gas furnace to heat entire house. Gas furnaces can waste up to 30% of their heat from leaking ducts. According to the DOE, “Ducts that leak heated air into unheated spaces can add hundreds of dollars a year to your heating ... bills."

We found that very few websites provide accurate information about gas appliances for consumers, in part because there are many gray areas due to lack of regulation. The CEO of one US manufacturer of gas stoves that we spoke to did not know if was required to test for efficiency or even if his products had been tested even though they were designed and marketed as heaters. We also called many retailers and received a wide mix of contradictory information. One told us we had to ask the manufacturer about efficiency. One had no idea how to determine efficiency. And one provided an efficiency from the “nameplate” but when we checked that number with the Canadian database, it was different. We concluded that consumers should beware of efficiency claims on manufacturer websites or from retailers and to always check the Canadian database if they wanted to know the efficiency of a product.

As a result of this, we strongly support the DOE finding that decorative hearths and outdoor heaters qualify as covered products under EPCA. Gas fireplaces and stoves are often used daily to provide heat for homes, as both a primary and secondary heat source. Consumers stand to save significant amounts of money and gas if these heaters are regulated and have to meet minimum efficiency standards. Many retailers advertise that gas inserts can easily serve as the primary source of heat for your home and claim that they use “50% to 90% less gas than gas logs and up to 75% less gas than a gas furnace.”3

Advertisements often
tout the heating benefits
of gas over wood in a
variety of ways.

We also support DOE’s determination to include propane products in the scope of this proposed coverage determination for miscellaneous gas products. Stoves and fireplaces that use propane are nearly identical to those that use natural gas and are very popular in areas that are not served by gas pipelines. The same companies that make gas appliances also make propane ones and it makes little sense to regulate one and not another and would create a confusing and artificial distinction for manufacturers, retailers and consumers. Propane is typically even more expensive than natural gas, so consumers stand to save far more if they have transparent and minimum efficiency ratings.

We are concerned that DOE may have underestimating the annual shipments of miscellaneous gas products. To the extent the DOE relied on figures from HPBA, they must consider that HPBA shipment data typically only includes appliance shipments by their member companies, not by all companies that make and ship gas appliances. In recent years, some of the largest gas appliance manufacturers have dropped their membership in HPBA, and as a result, shipments from those companies would probably not be included. HPBA does not disclose which companies provided data and which didn’t. Even for member companies, they cannot require disclosure of shipment data, but it appears member companies usually participate.

Thank you. Sincerely,

John Ackerly
President
Alliance for Green Heat

Wood Heating Trends in Utah

The proposal by the Governor of Utah to ban the wintertime use of wood and pellet stoves was met with intense opposition from a large majority of Utah residents and the wood stove industry. It also underscored the need for Utah state agencies, the media, and the public to better understand the role of wood heating and its prevalence in the United States. This short paper compares census data of wood heating in Utah compared to the rest of the country.

As of 2013, 10,500, or 1.2%, of Utah residents use mainly wood and pellets for their primary heating, far less than the national average of 2.1%, according to the US Census. There are likely to be an additional 40,000 to 50,000 who use it as a secondary heat source, though the US Census does not track secondary heating.  The EPA however estimates that there are about 93,000 wood and pellet stoves in Utah, some of which may not be used at all or only occasionally.

Utah is one of the states that buck the national norm, in that far more homes heated with wood and pellets in 1990 compared to 1940. Utah residents gave up wood heating faster than the United States as a whole, with the number of homes mainly heating with wood hitting a low point in 1950, two decades before the rest of the country. But between 1970 and 1990, Utahns embraced wood heating far more aggressively than the rest of the country. The number of Utah homes mainly heating with wood rose from 0.3% in 1970 to 3.2% in 1990, a high point that the state has not hit since then.


The rapid growth of wood and pellets in Utah since 1970 is likely due to many of the same reasons it has grown so quickly elsewhere: both gas and oil prices had been climbing, until gas prices finally dropped in 2008 and oil prices just starting dropping in 2014.  And, the increase of wood and pellet heating may also be linked to an increased desire for household energy security by both conservative and liberal households, but for different reasons.

Median household income remained relatively static in Utah for most of the 2000s before they began falling in 2008 and rising again in 2012, compared to the US where incomes first decreased in 2007 and only started recovering in 2013. Often, more households turn away wood heating as incomes rise and this is likely a factor in Utah since 2012 as well.

Since 2005, the percent of Utahns using wood or pellet as a primary or sole heat source has ranged between 1% and 1.4%, and since 2010 has remained steady at 1.2%, significantly below the national rate of 2.1% that has remained unchanged since 2009. Wood heating peaked in 2009, at the height of the recession and dropped slightly as the economy has picked up.

Wood and pellets are the fastest growing heating fuel in Utah, followed by electricity, as it is the US overall. Wood and pellet heating as a primary heat source had increased nearly 40% in Utah from 2000 to 2013, slightly less than the nation overall.

Utah is quite different than national heating trends when it comes to gas and oil. Gas heating has grown 30% in Utah since 2000, yet has only grown by 4% nationally. This increase in gas heating may be tied to slower growth of wood heating in areas with gas lines, while wood heating remains robust in areas without gas lines. Accurate county data could confirm this.  And oil heating has dropped far quicker in Utah than it has in the nation overall, although it has not been a very widespread form of residential heating in Utah.

Utah has the lowest percentage of homes heated primarily with wood in the West.  The Census does not have county level data of wood heating in Utah, but typically rural counties have far more wood heating than more urban ones.  And, lower income counties typically have more primary wood heating and higher income counties have more secondary wood heating.

EPA Estimates of Fireplaces, Stoves and Boilers in Utah

The EPA figures, above, estimate nearly a quarter million wood fueled devices in Utah.  A majority of those are fireplaces and studies show that a large percent of fireplaces are never used or only used once a week, unlike stoves which are often used every day.  About 93,000 units are stoves, nearly 16,000 of which are pellet stoves, 48,000 uncertified stoves (most made prior to 1990) and 26,000 are EPA certified stoves, made since 1990.

As this chart shows, 84% of Utah residents heat with gas, one of the highest percentages in the U.S. The second most popular heating fuel is electricity, which heats 11% of Utah homes, followed by propane, which heats 2%.  The fourth most common heating fuel is wood and pellets which account for 1.2% of homes.