The Shrinking Wood Stove/Wood Heat Market

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PHOTO: JOSEPH MEHLING
Dan Melcon, by his wood stove in White River Junction, VT, remains devoted to wood heat.

The American market for wood heat is dwindling, and
this emergency reserve of fuel — so entwined with the spirit of
individualism and independence — is being elbowed to the
sidelines by a glut of oil and natural gas. It seems that the
same collective amnesia that allows us to build gargantuan
sport utility vehicles has made us forget that a wood stove
is one of the last practical defenses against another energy
crisis. After we attended the convention of wood, gas, and
pellet stove manufacturers in St. Louis, I discussed this
situation with Dan Melcon, who has made a career of
monitoring the “hearth products” industry. — Matt Scanlon


MOTHER:One look at the most current
trade show in St. Louis is enough to convince a prospective
wood stove buyer that the industry is in a real transition.
The place was full of multi-thousand dollar gas and pellet
stoves … combination fish tanks and radiant beaters. But I
saw virtually no actual wood-burning stoves. My first
question to you is: Why has the wood stove seemingly
disappeared from the wood stove industry?

Dan Melcon:
[Laughs] It’s true, but I haven’t heard anyone ask me that
question in a long while. I did an article a while back
entitled “Whither the Wood Stove?” so I can appreciate what
you are referring to. I think that the wood stove has largely
disappeared from the wood stove industry because of declining
energy prices for one, the mentality that wood stove heat is
a hassle, the perception that wood heat is an environmental
“bad guy,” and finally, simple demographics.

MOTHER:So as oil prices plummet, wood heat seems less of a bargain?

D.M.: It
seems that way, but wood heat is still one of your least
expensive forms of home heating. The variable is how you
account for your own labor. Throwing logs into a stove is, to
some degree, labor intensive. So it depends upon how you
value that. But in terms of cost per million BTUs, wood,
along with natural gas, is still one of the best buys. Gone,
however, are the days when your oil bill exceeded your house
payment. Oil is selling for well under a dollar a gallon,
about 50% less than in the heyday of wood stove enthusiasm.

MOTHER:It’s hard for me to swallow that
Americans are gladly disposing of a bargain for the sake of
sheer convenience. I mean, the practicality of wood beat
is still only an oil-crisis away.

DM.:
Wood heat is regarded by a lot of people as work, and work
that they don’t have to do now. It might be because their own
economic situation is better or it might be because the cost
of the other energy options is a lot less expensive than it
had been. And also, as a society, we have gotten away from
some of the core values of [MOTHER EARTH NEWS’ ] readership:
being selfsufficient and harboring our natural resources and
using them wisely. Whether you look at the incredibly
wasteful sport utility vehicles or at the ostentatious square
footage of new housing, we’re not nearly as concerned about
living on a small planet anymore. Part of that care should be
heating with wood.

MOTHER:To be fair,
the government has played an indispensable role in the demise
of the wood stove. Now you have to be a combustion physicist
to go into business.

D.M.: The government was
the trigger point for it. In the 70s and early ’80s, when you
were heating with wood, you were one of the good guys. You
were getting local energy and it was renewable. It was taking
petrodollars out of the pockets of the OPEC countries.
Whereas now, the perception is that wood stoves are a dirty
form of energy. One of the most frustrating things from my
point of view is that the appliances that are available now
are so much better than the ones that the vast majority of
people experienced. When people ask me what I do, my short
answer is that I’m in the “wood stove business.” A lot of
people’s response is, “I thought that wood stoves were
outlawed.” Yes, the EPA is regulating them, and other than
automobiles, it’s the only consumer product the EPA
regulates. The perception again was that the government had
to step in because the old stoves were a major pollution
problem. There were problems, especially in the West, where I
lived. But the problems were as much of maintenance and
operation as they were problems of poor design. In the past
10 to 15 years, the industry has really made quantum leaps
in stove design and in reducing emissions … getting
corresponding increases in efficiency. When people talk about
wood stoves, they think of all those Model T’s that are in
the field that were built in the 70s and ’80s.

MOTHER:Until the EPA began to intervene
in the late ’80s.

D.M.: Right. The EPA
certification process has been in place for ten years now.
July 1, 1988, is when it first officially kicked in and
everything manufactured since then has had to be certified as
clean burning. I’d say about a million stoves were made in
the ten year period since then. But in the late 70s and early
’80s, there were about two and a half million stoves being
sold per year and the government estimates that there are
roughly 15 million existing wood stoves out there. The
analogy I use is that it’s as if people were continuing to
use computers from the early 1980s. The improvements are
there, whether it’s bum time or reduced clearance to
combustibles, cleaner glass, or lower emissions. I think that
if everybody had a certified stove instead of an older unit,
they would use them a lot more because they’re a lot more
user-friendly in terms of fire control now.

MOTHER:Do you really attribute the fact
that they’re holding onto their old stoves to relative
ignorance, or do the old stoves simply accomplish what people
need them to do? My argument against your computer analogy is
that a new computer is capable of doing five or six times as
much work as an early ’80s model, whereas a wood stove
basically accomplishes its mission regardless of design.
Nothing in my review of the new stoves suggests that they are
that different.

D.M.: They’re radically
different in how much cleaner burning they are. But from a
consumer’s standpoint, they both heat the house. And whether
you use two cords of wood or two and half cords of wood a
year, it’s not sufficient incentive to go out and make the
investment to upgrade. All the stoves in this country are
being used far less than they had been anyway, in terms of
the consumption of total cords of wood per year. Consumption
of cordwood has been declining for years. People like stoves,
they leave them in, they want them for backup, certainly. The
ice storms across northern New England and in southern Canada
this year reacquainted people with some of their benefits.
But to a large degree they leave them in the comer and turn
up the thermostat.

MOTHER:What would a
low-end stove installation run a consumer — say a low-end
stove capable of beating a 1,500 square foot house?

D.M.: For an installed package — that is the stove, the
hearth pad the stove sits on, wall protection if it is
needed, chimney installation — you’re going to be between
$1,600 and $1,800 for an installed, certified, clean burning,
cordwood burning conventional stove, on the low end. That
could run all the way up to $3,000 for a nicer cast-iron
enamel stove with whistles and bells. The certification costs
are one large part of why such a basically simple appliance
is so expensive. For instance, almost all the stoves on the
market now have clear ceramic glass to allow viewing of the
fire. And yet this material, because it’s shatterproof, is
expensive. When I used to work at Omni Environmental Services
test lab, part of the safety test included heating the glass
to 1400°F, then squirting cold water on it and smacking
it with a two-inch steel ball swung on a 16-inch pendulum.
It’s very expensive stuff, testing. All these improvements
incorporated as standard features in the stoves have caused
the price to increase as well.

MOTHER:When we are figuring the low cost of wood, is that
taking into consideration the up-front installation
costs?

D.M.: You amortize the total
cost — $1,600 to $1,800 on the low end — along with the cost of
the fuel itself. It’s assuming you’re purchasing cordwood at
about $100 a cord. it does take into account the cost of the
equipment.

MOTHER:A furnace costs a lot
more than that. But I was shocked to find that the least
expensive wood stove I saw costs about a thousand bucks. I
wondered what the world was coming to.

D.M.: Just going through some of the
companies in my mind, Travis Industries’ Lopi “The Patriot”
will heat 1,000 to 1,500 square feet. When you buy it
stripped down, without the fan, without the convection
chamber, without the gold door, it’s list price is just under
$750. it’s a good value.

MOTHER:But
that’s not representative of the standard low end.

D.M.: Of the stoves that are sold out there,
maybe 20% are under $1,000, maybe 60% are about $1,500, and
maybe 20% are $1,500 and up for the stove itself.

MOTHER:Are there any other
manufacturers at the low end that offer good value?

D.M.: Jotul of Norway is the largest
manufacturer of wood stoves in the world. They make a
cast-iron stove called the 602. This design predates WWII.
They modified one of these models so it passes the EPA
standards. It’s a small unit; it’s more a zone heater for a
room. It’s not a whole house heater, but it retails for about
$600. Waterford Stoves out of Ireland has a nice real low-end
box cast-iron stove [the 104 MKII] that also is in the $600 price range. There are some
stoves designed to go to mass merchants and home centers.
There’s a company out of Virginia called Englander that makes
some. There is a company that’s a subsidiary of Jacuzzi up in
Ontario called Century Heating Products that makes some
low-end stuff. And there are other good values to be had,
you’ve just got to scour those dealers. John Gulland
instituted a great Web site for a potential buyer that I
refer to often.

MOTHER: Do you think the industry has any
regrets about leaving behind the pioneering spirit of wood heat? Do they feel that they’ve inherited an unfortunate
situation from the government that they’re making the best
of? Maybe they’re just making good money right now and that’s
the end of it.

D.M.: No, a lot of people in
the industry are very uneasy about where we are headed. They
feel like we have in fact left our roots and abandoned the
core philosophy that brought people into the business in the
first place. Many are not comfortable with it at all.

MOTHER:Trade shows are always exercises
in splendor, but that opening presentation of an enormous gas
stove with a waterfall running over it struck me as a perfect
metaphor for what is wrong with the heating business right
now.

D.M.: Right. It’s like: “What the
hell is all this about?” To be honest, that’s my reaction: Is
this appropriate? Do we need this? Is this what we have been
about historically? The answer in my mind, obviously, is no,
but the reality is that the industry is changing, and it is
changing to reflect consumer choices and consumer demand.

MOTHER:Are there more manufacturers now
than there were five years ago?

D.M.:
The number of wood and pellet stove manufacturers continues
to decline. During the energy crisis, around 1979, there were
about 2,000 manufacturers that had listed products. By the
time the EPA regulations kicked in about ten years ago, the
number had dropped to about 500. That was natural attrition.
The market declined; people that did not build good units, or
were not good business people, or who could not adapt to
improvements in aesthetics got squished. The next big squeeze
was with the EPA rule. To mitigate it, they had temporary
exemptions for small manufacturers of less than 2,000 stoves.
There are now about 60 manufacturers that make certified wood
stoves, but only 20 really do any volume and make more than
1,000 stoves. I’d say 20 companies make less than 1,000
stoves, 20 make less than 500, and 20 make more than 1,000.

MOTHER:The majority of the time, it
seems that new stoves are purchased as a decorative adjunct
to an existing beating system. These are not primary systems
anymore.

D.M.: I think it’s fair to say
that almost no one is buying a hearth product because they
have to. In the ’70s, with those tremendous oil bills, you
had to do something about it. Now that’s not the case.
They’re making the choice for aesthetic, ambiance, lifestyle
reasons. One thing that has never been lost is the universal
appeal of the fire. I always say that watching fire
and falling water are two things that intrigue and entrance
people. That appeal is always there, but now it’s a matter of
choice, not necessity.

MOTHER:It will
shock MOTHER EARTH NEWS readers to hear that people are not buying wood
stoves because they need them anymore but because they look
pretty.

D.M.: A perfect example of your
statement is that currently there are 500,000 sets of vented
gas logs sold every year, which pour 50,000 to 100,000 BTUs
per hour straight up the chimney. It’s incredible. I’m in
rural Vermont, where there is no access to natural gas. When
the oil companies say we can sell you a gallon for 70 cents
and 20 years ago it was $1.20, you heat with what works best
and most simply. Nobody’s buying because they have to. It’s
because they want a fire in their home.

MOTHER:This explains why an
overwhelming number of pellet stoves — and some of the gas
stoves — actually require electricity to run.

D.M.: Right. All pellet stoves require
electricity. There are backup systems available, but if
you’re using a pellet stove, you’re on the grid.

MOTHER:And you’re cold without it.

D.M.: You can run them off of 12V batteries.
There are backup units, but again, they are for relatively
short periods of time. Most power outages are for relatively
short periods of time. But that’s not always the case….

MOTHER:Absolutely. This winter we were
reminded in the north country that a single ice storm can
chase you out of your house and into a Red Cross shelter in a
couple of days in the absence of a backup heating system. Did
the storm change the industry’s attitude about wood heat?
Has it influenced sales?

D.M.: Most gas appliances don’t need electricity to
operate, so if you had a gas or wood stove, you were probably
in good shape. But yes, I think the ice storm was a
wake-up call to the industry to get back to its roots. All of
a sudden our products were something that people needed, that
they depended upon in order to stay in their homes.

MOTHER:Are there any governmental
regulations this year that affect the wood burner?

D.M.: At this point, no. The EPA standards
of ten years ago have proven effective in cleaning up the
emissions from individual stoves. The problem of pollution
from wood has largely gone away because of the wholesale
decline in the use of wood heat anyway. Some of the worst
problems with wood heat were in Oregon. I worked really hard
with the Oregon Department of Environmental Quality that came
up with the first standards and which essentially became the
EPA standards. And so the problem essentially went away. At
this point, there are no significant changes on the horizon.
I pay lots of attention to regulations, and there are no red
flags out there.

MOTHER:Where is the industry
beaded? Do you forecast still fewer wood stoves being
produced;, more gas stoves?

D.M.: Wood
stove sales declined from 1981 until 1996 or 1997; there was
a little spike during the Gulf war, with a crisis mentality
and rising oil prices, but it seems to have leveled out.
Pellet stoves came on strong with lots of appeal. Then people
found out that a lot of the primary benefits that pellet
stoves offer — convenience and efficiency — are there in spades
with gas. A lot of the potential pellet market converted to
gas. Pellet stoves went way up, then declined. Wood and
pellet stove sales seem to have leveled out. There will
always be a market for them. There will always be people like
myself who like burning wood, who like the ritual of making a
fire, who like the unique penetrating warmth that comes from
the radiant heat of a stove relative to heated air. That
market will always be there, and it seems to have stabilized.
My suspicion is that it is going to come down to a slight
degree. Here is where I’ll get politically incorrect again.
Watching a real wood fire is mesmerizing: it’s changing, it’s
alive, it’s happening all the time. Watching a pellet fire is
much less appealing. You have a combustion fan that is
blowing into the firepot. As much as the gas industry feels
that a gas fire can mimic a wood fire, it’s not the same. I’m
hopeful that wood will rise again.

MOTHER:It does get pretty hysterical watching the industry
chasing its tail and inventing whirring aluminum flakes that
simulate the undulation of flame in a gas stove.

D.M.: The question is, “Why are you guys
working so hard to create a fake fire when a real fire is
available?” I think the answer to that over time will be a
shift back to wood. But there are still issues that need to
be resolved about fuel. Gas is a no-brainer as a fuel: it’s
piped to your house. Pellet distribution is not a factor in
general. You go to the store, you buy a ton of them or you
have them delivered, and you pour them in the stove.

MOTHER:And much of what constitutes
pellet fuel is wastepaper and waste wood that would otherwise
be disposed of.

D.M.: It’s a waste
by-product that would otherwise end up in land disposals or
something like that, yes. Whereas with wood you either have
to get it yourself or you have to buy it. The old guy with
his chain saw and pickup truck has largely disappeared from
the scene as the economy has gotten better and the demand for
cordwood has declined.

MOTHER:Well,
we’re not planning on selling the pickup and chain saw just
yet.

D.M.: [Laughs], Yeah, I’ll hitch a
ride during the next energy crisis.