Commissioner of the Department of Conservation, Patrick McGowan shows off some wood pellets in his Augusta, Maine office. Photo by Ramona du Houx


Article by Ramona du Houx

Throughout the state wood pellet stove dealers are experiencing record sales. They have initiated layaway plans, are selling units faster than they are receiving them and are taking backorders. One dealer said that a year ago he received an enquiry about the stoves once a month, now the phone rings all day.

Eighty percent of homes in Maine are heated by oil. This year that’s about to change. During Governor Baldacci’s State of the State address last January, he announced a taskforce for a wood-to-energy initiative. Wood pellets will play a pivotal role.

“Wood pellets are a great option for the people of Maine. Some are converting their systems, pulling out their old natural gas, oil or propane furnaces and installing wood pellet furnaces to heat their homes or businesses,” said Commissioner of the Department of Conservation, Patrick McGowan, who is heading up the initiative. “Most people are buying wood pellet stoves and to supplement the oil, propane or natural gas furnaces and they have found real savings. The DOC changed over our forestry operations for the 07-08 winter, and cut costs in half. Now with oil prices even higher, we will see greater savings.”

With home heating oil at $4.70 a gallon, it amounts to thousands to heat an average Maine home. Residents are now looking for home heating security. Wood pellets, made in Maine, are a local natural resource. The pellets are made from sawdust, or wood waste from mills or forests. They vary in quality depending on the stock source. Maine’s forests could be part of a readymade solution to the energy crisis.

“This is a Maine solution, using a Maine natural resource, processed at Maine plants, employing Maine people at a stable price. Energy prices connected with fossil fuels have all gone way out of sight. What we know is there is no shortage of oil; they are blaming it on speculators for the most part. But, it’s greed on the part of oil companies. People of Maine are struggling. It’s not your local oil dealer that’s making this money. He’s still working the same margin they worked on for the past two decades.”

McGowan (photo below) should know for he once was an oil dealer before he worked for the Small Business Administration during the Clinton Presidency.

“The major oil companies are making these gross profits, like never before in the history of the business. I would hope that the oil dealers would see the wisdom of changing over to wood technology,” he said, “Just like a hundred years ago, when Maine used coal and wood and transferred over to oil. It’s time to update and change with the new technologies that add value to our sustainable, natural resources. Saving money on energy costs is good common sense.”

On average wood pellets are a 50 percent savings. As of July, premium pellets were selling for $250/ton, which for the same heat output in BTUs is close to paying $2.10/gallon for #2 heating oil; a tremendous savings, with home heating oil selling for over $4.70/gallon. Depending on the square footage of the home or business and the amount of oil used, the initial investment would pay for itself in 3 – 10 years. The average Maine home would burn seven to eight tons of pellets per year.

“Because Maine is 80 percent dependent on oil for residences and 99 percent dependent on fuel oil, we have the worst oil dependency in the county — with the oldest housing stock,” said McGowan. “These old houses need winterization to cut energy costs. We need more wind power, tidal and solar. We need more pellets, biofuels, bio-bricks and woodchips. We’re looking at incentives or loan programs to encourage people to make the switch.”

Incentives could be similar to the solar rebate program and/or the proposed geothermal credit, providing cash rebates for about one-quarter of the cost to install pellet stoves or boilers in residential applications and pellet or chip boilers for larger public/private business applications.

Currently, Maine’s commercial forests contain enough waste wood to heat 150,000 homes and small businesses with wood pellets without reducing fiber supplies to existing mills.

“Maine’s wood-to-energy initiative is a way to promote sustainable economic development in the forestry sector while reducing our dependency on foreign oil. Maine has the best forestry inventory than it has had in 60 years. It’s a very healthy forest,” said the commissioner. “Unfortunately, we send a lot of logs to other countries. Then they add value to them and make more money. This is a situation where we could sell the wood in Maine, produce and mill it — in Maine — and sell the product to the people of Maine. We need to add value to our own forest resource. As a result the pulp and timber industries would receive an economic boost as heating oil is replaced by a value-added, wood-waste product — pellets.”

Wood-to-energy program goals:

• reduce Maine’s dependence on foreign oil specifically, and fossil fuels,

• reduce heating costs,

• enhance markets for Maine’s forest products, and

• maximize the benefits that Maine people realize from the use of our forest resources.


With 19 million acres of forests, wood-based alternative fuels make sense.

The wood source is there. The DOC’s report to the governor states that an estimated 4.4 million tons of branches, treetops, cull trees and other wood fiber is left in the woods after harvests in Maine annually. About 1.8 million tons of that waste wood is good enough to use in the production of quality wood pellets.

Using that waste wood from Maine forests would allow future wood pellet manufacturers to produce about 900,000 dry tons of pellets.

“It’s sustainable, renewable, and lessons our carbon footprint. With oil usage, Maine has a terrible carbon footprint,” said McGowan. “Though we get credits for our forests, they are cancelled out by our dependency on oil.”

There are currently three pellet manufacturers in the state — Corinth Wood Pellets, Northeast Wood Pellets in Ashland, and Maine Woods Pellet Co. in Athens. Corinth Wood Pellets produces a forty-pound bag of pellets every second.

The Bureau of Parks and Lands could supply up to 55,000 tons of pellet-quality wood annually within a 50-mile radius of these three existing pellet plants, assuming target stumpage price of $6/ton can be achieved.

Four more wood pellet manufacturers are in the planning stages.

The DOC is currently working with other state agencies and stakeholders to meet the challenges of supplying this new energy source and installing the stoves.

“Maine needs a fuel distribution system to make wood pellets more convenient for consumers,” said McGowan. “We also need to train more technicians to install pellet stoves.”

Former ski resort owner Les Otten is investing $10 million to launch Maine Energy Systems, a company that will import European pellet boilers, install the heating systems, and deliver the fuel. He plans to begin installing these high-end systems this summer.


The governor is leading an inventory of energy uses at public buildings throughout the state, including state and local government offices, schools and hospitals. The inventory will identify buildings where it makes economic sense to convert to wood pellet heat.

“Public buildings will benefit from the cost savings a wood pellet heat system can provide. School budgets are struggling with oil increases. Wood pellets are the perfect fuel for schools. We definitely will recommend schools convert,” said McGowan. “It’s also a great way to educate children about energy.”

The state will eventually seek bonds to pay for the upgrades to public buildings.

“Thomas Freidman talks about the new jobs that are in the U.S. economy,” said the commissioner. “Clean energy is a big part of that, and wood pellets are a big part of that — along with bio-bricks and biofuels. This is a big opportunity for the people of Maine.”

Replacing 10 percent of the state’s oil consumption with homegrown wood pellets would produce $350 million in economic activity and generate up to 3,700 jobs.

Wood Pellet Facts —

The initial expense is anywhere from $1,300 to $3,000 for a stove and $4,000 to $12,000 for central heating pellet systems. By comparison, an average insulated Maine farmhouse burns 2,000 gallons of oil per year to heat. At $4.60 a gallon that’s $9,200 a year.

The average Maine home would burn seven to eight tons of pellets per year, or $2,000 of pellets.

Pellet-burning appliances are often compared to oil and electric heaters for ease of use. They require less frequent refueling, can be vented through a small hole to the outdoors, and produce virtually no smoke. They are safe and stay relatively cool to the touch, since the stove exteriors are not used to radiate heat. Bags of pellets are more easily and compactly stored than wood and pellets are easy to load into a stove.The low moisture content of pellets results in high efficiency and few unwanted emissions.

Some manufacturers use logs but most pellets are manufactured from wood products that normally go to waste: “trash” wood, such as roadside saplings culled by road crews; limbs, tops, and other residue of logging; sawdust and woodchip byproducts of lumber mills and manufacturing with wood; and cardboard and other wood fiber, such as paper packaging, that normally goes to clog landfills. The raw material is ground, dried, and compressed into pencil eraser-size biscuits of uniform size, dryness, and energy content.

Their high density also permits compact storage and rational transport over long distance. They can be conveniently blown from a tanker to a storage bunker or silo on a customer’s premises. A large number of models of pellet stoves, central heating furnaces, and other heating appliances has been developed and marketed since about 1999. This new generation of wood pellet stoves and boilers are thermostatically controlled, and most of them can be lit automatically.

  • Pellet fuel, with 90 percent efficiency, has been proven to provide the cleanest burn of any solid fuel.

  • With substantially higher BTU value per cubic foot than cordwood, pellets produce more heat. Pellets are more efficient than cordwood, due to their vastly lower moisture content.

  • A 40-pound bag of New England Wood pellets produces only three ounces of ash.