In late February, Pellet Fuels Institute Chairman and producer member Stan Elliot represented our organization at the European Pellet Conference in Wels, Austria. The conference has become a significant meet and greet for anyone making pellets in or for the European market. While there, Stan told me that estimates for pellet appliance sales in selected markets were being shared, and that Italy saw 245,000 stoves sold and installed in 2017. France saw 100,000 appliances installed. Keep in mind, those totals were achieved in countries with 60 million and 66 million people, respectively, barely one-fifth of the population of the U.S. If the U.S. saw the per-capita new appliance sales the Italian market achieved last year, over 1.3 million new pellet appliances would have been sold. Even using modest per-unit consumption rates, we would be looking at 1 million tons of new demand in the home heating market.

While a comparison with the Italian market could very quickly turn into a discussion about policy and taxation differences, I offer these numbers up as a means of catalyzing a renewed conversation on the growth of the residential heating marketing in this country, those responsible for driving toward those goals, and how it all might be accomplished.

The answers to the first two questions, for me at least, are very straightforward. There is no better conversation for the PFI to be engaged in, and while we’ll certainly have to engage a number of marketplace partners, the simple truth is that the growth of the domestic wood pellet market is our responsibility. It is our responsibility because while our marketplace partners benefit from the sale of a new pellet appliance, they also benefit from the sales of other home heating technologies. Wood pellet producers are unique in the home heating space, in that a pellet appliance is the only home heating appliance sale from which they benefit. This is true for no other stakeholder in the broader wood energy/home heating supply chain. Even our woody biomass allies have nonpellet marketplace options in cordwood and chip appliances. Our market grows only when a new pellet appliance is sold, and it is imperative that producers embrace this reality, and work aggressively to get it done. The hard part of course is answering that tricky third question—how do we go about getting that done? While the answers may be elusive, what is crystal clear is that for our members, this is priority one.

The bulk of the next two quarters of my tenure at the PFI will be dedicated to building a cohesive market growth strategy that leverages our enviable roster of marketplace partners and supporters, but recognizes that the best place for our association to be in this effort is at the front.

I’m calling this initiative Operation 100k, a strategic and deliberate attempt to establish 100,000 units as the floor for annual pellet appliance sales in the U.S. We most recently achieved 100,000 units in 2014. Prior to that, annual appliance sale numbers typically came in around 60,000 units. That is simply not enough for the kind of market growth our industry and members want and deserve.

Severity of winters and the price of heating oil are impossible to predict, but it is vital we plan based on the trends we are seeing now—shorter heating seasons and low-priced alternatives—as we look into the future of our industry. Attracting a stable roster of new pellet users year after year is our path to real growth.

The good news is we’ve got some incredible allies, and some great minds, all with a vested interest in accomplishing the same thing: more buyers of wood pellets tomorrow than there are today. I hope you will join me and the Pellet Fuels Institute on Operation 100k. I look forward to working with all of you.


Author: Tim Portz
Executive Director, Pellet Fuels Institute
tim@pelletheat.org
651-398-9154