Wood Heat

Between the impact of the hurricanes and the generally high cost of energy this year, the price of natural gas right now is nearly three times what it was a year ago, and about twice what it was at the peak price last winter. I have no idea of this is a short term spike or will be sustained (the futures price right now is about 20% cheaper than the spot price, which means that the market thinks the price will come down fairly quickly), but even if the current price is temporary, we're looking at significantly higher heating costs this winter than in the past.

I went back through our records in Quicken, and found that last winter (2004-2005) we spent about $1,400 to heat our home for the entire winter. I got that by adding up all our gas bills for the heating season, and subtracting our average summer gas bill (about $25/month, which is what we spend for cooking and hot water). The winter before, which was unusually mild, we spent about $960 on heat.

Unless natural gas prices collapse in the next couple months, we're looking at easily over $3,000 on heat this winter (if we have a typical winter). Urk.

In my mind, this means it is time to start thinking about alternatives. Of course we'll be turning down the thermostat, but that only gets you so much. This is Minnesota after all, and you can't let the house freeze.

But we do have three fireplaces and tons of firewood which we really need to do something with. Open fireplaces (which is what we have) are not a useful source of heat, since most of the heat just goes up the chimney. But fireplaces with high efficiency stove inserts are a useful source of heat, and some of the largest models can put out almost as much heat as our furnace. Running the furnace blower (the fan which circulates air throughout the house) should distribute the heat around the house for about $1 to $2 per day.

I don't expect that wood heat is a practical way to replace natural gas in our house 100%. But if it is sufficient to keep the furnace off on all but the coldest days, that will still save us a ton of money. Since stove inserts seem to run around $2,000 to $3,000 installed, buying one could pay for itself in a single heating season (depending on gas prices). Buying two stove inserts could pay back in 3-4 years. And we have enough trees in our yard to provide a steady supply of firewood in future years even after we use up our current oversupply.

So this is clearly something worth looking into further.

UPDATE: The biggest fireplace inserts cost around $4,000 installed. For that price, you get a capacity of up to 75,000 BTU/hour. A back-of-the-envelope calculation suggests that our home requires a total heating capacity of 135,000 BTU/hour, so that $4,000 could replace about 3/5 of our heating capacity. If we could expect to spend $3,000 on gas this winter, then the wood stove would achieve about $1,800 in savings the first year.

In reality, we can do a lot better. By running the wood heat flat out for the entire winter, the wood heat becomes the first 75,000 BTU/hour of heating, with the gas furnace only kicking in on those very cold days when the house needs more than 75,000 BTU/hour. In other words, the burning wood is our base heating, with the gas furnace the peak heating. If it turns out to be practical to run a wood stove 24/7 for the entire winter (that's a pretty big if), then we could replace as much as 80% or more of our gas use, or $2,400 for the season.

Bottom line: this purchase could easily pay for itself in 2-3 years. As a bonus, we'd be heating our home with cheap (essentially free for us), renewable, non-greenhouse fuels, and modern stove inserts have much lower emissions than regular fireplaces. Plus a fireplace is prettier than a gas furnace. Installing two inserts for $8,000 would replace nearly 100% of our current gas heat and pay for itself in three years if gas prices stay high. Installing inserts in all three of our fireplaces wouldn't get us anything more in terms of savings, but we would get more flexibility.