Winter’s here; Time for the pellets?

With cold weather having established a firm foothold in the region, thoughts turn to heating homes and the attendant price of oil, propane, and firewood.

Yet there is another option, one that is a growing trend in Vermont.

Chris Brooks, CEO and President of Vermont Wood Pellets, owns and operates the only wood pellet factory in Vermont. Based out of North Clarendon, he and his company obtain locally harvested wood that they then convert into pellets, which can be burned in wood pellet stoves and boilers.

Brooks stresses the local nature of his company.

“I believe in the small [business] model,” said Brooks in an interview. “I think it’s beneficial. People ask me if my wood is certified. I say ‘yes it is, it’s certified by my local community.’ We know where it’s being cut, we know who’s cutting it. What we are taking out of the forest is a manageable pressure for the forest.”

The lumber that supplies the factory comes from within a 30-mile radius that factory, drawing from 100,000 acres of timber cropland in Vermont. He utilizes the services of around 80 Vermont logging companies, while employing 24 Vermont workers at his factory. Each year, between 45,000-55,000 tons of Vermont lumber is converted into 16,000-18,000 tons of pellets at Vermont Wood Pellets. The factory works with the top section of harvested trees (the lower halves go to other businesses), which are debarked, chipped, dried via a wood-fired furnace, and then sent into the pellet mill, whereby the forces of pressure and heat form the pellets themselves. While some brands of wood pellets contain additives, Brooks’ pellets contain none.

Oil was cited as the biggest competitor to the wood pellet industry. Despite this, business has been good — quite good, in fact. Brooks stated that his factory, which is comparatively small in size, cannot keep up with the demand for wood pellets even when running at maximum capacity. Supply is sometimes met by larger, out-of-state mills or even Canadian mills. For instance, New England Wood Pellets in Jaffrey, N.H., turns out 100,000 tons each year, with most wood pellet mills turning out between 50,000 and 100,000 tons a year. As a result, plans are currently underway on the part of Brooks to open a second factory in Vermont.

“We are working to open up another mill as we speak,” said Brooks. “As fast as we can.”

Everything possible is being done to have the factory up and running by next heating season. The new factory will be similar in size to the current factory, he said.

“I can tell you that more and more people are going to pellets,” said Brooks. “The high school in Rutland did, Housing Trust Vermont has switched all of their heating in new buildings to pellets, and the Wallingford school system is also switching. We also supply around 3,000 private customers at this point.”

Alan Benoit, Vice President of Vermont Renewable Fuels, operates one of the locations supplied with wood pellets by Brook’s North Clarendon factory. Benoit then distributes the pellets to customers on a weekly basis, using both a tractor-trailer and a fully pneumatic bulk pellet delivery truck for smaller-scale deliveries.

“We drive all over Vermont and into New York, New Hampshire, and Massachusetts, delivering pellets in bulk,” said Benoit.

December and January witness an upsurge in demand, and Benoit’s delivery vehicles might be on the road as much as five days a week.

Aside from pellet deliveries, Vermont Renewable Fuels is southern Vermont’s only certified Pellergy wood-pellet system installer. Pellergy, a wood-pellet boiler heating company out of Montpelier, produces the heating systems that Vermont Renewable Fuels install. They have installed over 100 systems in Vermont alone, including some modulatin and self-cleaning units. Many units are designed to heat residential buildings, while other units can generated up to 200,000 BTU’s, which could heat a 5,000 sq foot commercial building.

“If you have an existing oil boiler, or a wood boiler, we can actually convert it for you,” said Benoit. “That is the most affordable system. Buderus systems for example are very easily convertible. But not every model is convertible, so we can include a boiler and take our your existing boiler.”

Benoit stated that he experiences a 50-50 ratio of oil boiler conversions to complete installations. Some local installations include one of Burr and Burton’s dormitories, The Manchester Chamber of Commerce, and rk Miles, Inc.

Although the concept of wood pellet boilers originated in the United States during the oil crisis of the 1970’s, Europe is now the stronghold of this industry, where populations have been much more motivated to explore alternative heat sources due to consistently high oil costs. Tens of thousands of European homes are heated with pellet boilers and stoves, with Austria manufacturing many of the available models.

That is not to say that it is not a growing trend in our own country. Benoit pointed to 2007 as a huge year for Vermont in the wood pellet industry, and business has been steadily on the rise.

“There are more systems being installed every month, every week. There are a lot of elementary schools and high schools that are now heated using pellet boilers,” said Benoit. “We deliver to plenty of churches and affordable housing sites as well, along with commercial buildings and homes.”

“I don’t think it has even started to take off yet,” he added. “It’s a matter of education, trying to get people to understand how they work, how easy they are, how reliable they are.”

One disadvantage that Benoit pointed out is the up-front installation costs. Without taking into account the installation itself, wood pellet boilers run anywhere from around $4500 to nearly $14,000. Yet as he also said, the average return on investments is three to five years. Another issue can be space, with crawl spaces and low-ceilinged basements providing an obstacle. To combat this Benoit’s company can install adjustable steel bulk boilers.

Mike Kilburn of Dees Electric in Manchester installs geothermal heat pumps into people’s homes that allow homeowners to utilize solar heat stored underground in soil or rock to heat their homes. As a fellow advocate of renewable energy, he had his own thoughts on the wood pellet industry.

“It certainly has its market, said Kilburn. But when asked if the wood pellet industry was poised for an upward swing in popularity, he stated, “I would think so, but with current market prices that might more difficult to achieve than it would have been two or three years ago. When we were looking at pre-buys in the $5.50 range, everything else looked good. Now a barrel of oil is under $70 — that’s a huge difference.”

Said Benoit, “Wood pellets are equal to an oil cost of $2.20 per gallon, so as long as oil stays higher than that, pellets are more economical. And it compares to about $1.90 a gallon for propane.”

At the time of this article, residential heating oil is $3.17 per gallon, with residential propane coming in at $3.12 per gallon.

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