Wood-fuelled heating systems, also called biomass systems, burn wood pellets, chips or logs to provide warmth in a single room or to power central heating and hot water boilers.
A stove burns logs or pellets to heat a single room - and may be fitted with a back boiler to provide water heating as well.
A boiler burns logs, pellets or chips, and is connected to a central heating and hot water system. A wood-fuelled boiler could save you nearly £600 a year compared to electric heating.
The benefits of wood-fuelled heating
Affordable heating fuel: although the price of wood fuel varies considerably, it is often cheaper than other heating options.
Financial support: wood fuel boiler systems could benefit from the Renewable Heat Premium Payment and the Renewable Heat Incentive.
A low-carbon option: the carbon dioxide emitted when wood is burned is the same amount that was absorbed over the months and years that the plant was growing. The process is sustainable as long as new plants continue to grow in place of those used for fuel. There are some carbon emissions caused by the cultivation, manufacture and transportation of the fuel, but as long as the fuel is sourced locally, these are much lower than the emissions from fossil fuels.
Costs, savings and earnings
A pellet stove will cost around £4,300 including installation. Installing a new log stove will usually cost less than half this, including a new flue or chimney lining.
For boilers, an automatically fed pellet boiler for an average home costs around £11,500 including installation, flue, fuel store and VAT at 5%. Manually fed log boiler systems can be slightly cheaper.
Pellet costs depend mainly on the size and method of delivery. Buying a few bags at a time makes them expensive. If you have room for a large fuel store that will accept several tonnes of pellets at a time, delivered in bulk by tanker, you can keep the cost down to around £190 per tonne in most parts of the UK.
Logs can be cheaper than pellets, but costs depend on the wood suppliers in your local area, as they cost a lot to transport. If you have room to store more than a year’s worth of logs you can save money by buying unseasoned logs and letting them season for a year. Search for wood fuel suppliers in your area at the Log Pile website.
Savings in carbon dioxide emissions are very significant - around 7.5 tonnes a year when a wood-fuelled boiler replaces a solid (coal) fired system or electric storage heating. Financial savings are more variable - if you replace a gas heating system with a wood-burning system you might save £100 a year, but if you are replacing electric heating you could save as much as £580 per year.
You may be able to receive payments for the heat you produce from a wood boiler through the government’s Renewable Heat Incentive (RHI). This scheme should be launched in Summer 2013.
From August 2011, you may be able to get help with the installation costs of a wood boiler through the Renewable Heat Premium Payment scheme.
Pellet and log stoves are not eligible for Renewable Heat Premium Payments, and are not expected to be supported by the RHI.
What is the Renewable Heat Incentive?
The Renewable Heat Incentive is similar to the Feed-in Tariffs, a comparable scheme for electricity which went live in April 2010. The Feed-In Tariffs have done more than anything else to accelerate the installation of renewable energy capacity in Europe. That's why the founders of Renewable Heat Incentive Limited were so active in the campaign to introduce them in the UK. It succeeded and in 2011 the first phase of the Renewable Heat Incentive will come into force.
Who is it for?
Broadly speaking, the Renewable Heat Incentive is for everyone, including households, landlords, businesses, farmers, schools, hospitals, care homes and more. The RHI can even be used by entire communities, coming together to invest in a renewable scheme from which they will all use the heat and share the income.