How is your home or business being heated?

The payback of a wood pellet heating system varies based on what existing heating system you are replacing. Replacing electric or propane heating will yield the most savings – as much as $2,000 a year or more for the average home.

Clean heating and cooling can be an excellent investment for a home or business owner. Nearly 60% of homes around New England are still heated with oil, electricity, or propane. Wood pellet heating systems are a great fit for home and business owners who are in need of an oil or propane boiler replacement or use electric resistance heat. A family of four in a 2,000 square foot home can expect the following savings from replacing an existing system with wood pellet heat:

Wood Pellet Heating Expected Savings**

Fuel Type Oil Electricity Propane Natural Gas
Fuel Cost $3.13/gallon $0.157/kWh $3.09/gallon $1.38/therm
Annual Savings $640 $2,980 $1,850 $(500)
Lifetime Savings $12,850 $53,500 $31,050 N/A
Years to Payback 9.9 4.3 5 N/A


With New Englanders spending over 60% of their energy bills on heating, a high-efficiency system that provides both heating and cooling just makes sense. Home and business owners still heating with electricity, oil, and propane can’t afford to not invest in clean heating and cooling.

**Annual savings are average expected savings over 20-year lifetime. Assumptions for expected savings include: fuel prices of $3.13/gallon for oil, $3.09/gallon for propane (Massachusetts winter 2014/15 average, MA DOER), 15.72 cents/kWh for electricity, and $1.38/therm for gas (Massachusetts averages from 2011-2014, EIA) and escalators ranging from 0.8% to 2.1% EIA Annual Energy Outlook 2015, Reference Case for New England); installed cost of $19,000 (installer interviews, includes bulk storage and thermal storage); and use of all available incentives, including a 0% interest Mass Save Heat Loan (see here for more information on wood pellet heating incentives).