Business

Soaring heating oil prices ignite firewood demand

On a recent scorching summer day, workers at Reed's Firewood used heavy equipment to cut and split logs into firewood until it was too dark to see.

Despite the relentless pace, the family-run business is failing to keep up with demand as homeowners shellshocked by the price of heating oil look to old-fashioned firewood as a way to lower their bills this winter.

The cost of seasoned firewood in Maine has jumped roughly 50 percent from a year ago, but it remains a relative bargain when compared with heating oil, which is nearly $2 per gallon more than last year. Many customers are doubling their usual orders and some firewood dealers are turning away customers.

“We've really never seen anything like this before,” said Lloyd Irland, who teaches forestry economics at Yale University and runs a consulting business in Maine.

While most heating oil customers aren't dumping the fuel altogether, they're using less by upgrading furnaces, turning down thermostats, insulating their homes and turning to alternative fuels, including firewood.

A survey by the Maine Forest Service found most dealers out of seasoned firewood and some short of green wood, which doesn't burn as well because it isn't dry enough.

Paul Reed, the owner of Reed's, tells customers he has plenty of firewood, as long as they're willing to wait until December – and accept possible price increases. “I've been called a couple of choice words,” Reed said while making a delivery.

For the first time in his 23 years in the business, volatility in the market has forced Reed to abandon fixed pricing that customers count on. His price for a cord – a tight stack 4 feet high, 4 feet wide and 8 feet long – rose from $190 early last winter to $255 for green and $300 for seasoned wood.

Firewood remains a deal for those who don't mind the hassle of lugging it around and periodically feeding their wood stoves or fireplaces.

On average, a cord of firewood has the same heating potential as 155 gallons of heating oil, said Peter Lammert of the Maine Forest Service. Thus, a cord of seasoned firewood costing $300 is a bargain compared to 155 gallons of heating oil costing $685.10, based on $4.42 per gallon, the current statewide average.

It's a stark contrast to the mid-1990s, when heating oil sold for around 79 or 80 cents a gallon – and a cord of seasoned firewood was about $125.

Oil was so cheap then – trading at less than $20 a barrel, compared with roughly $120 today – that Reed resorted to calling longtime customers in the spring to drum up orders.

Today, Maine's firewood producers are heavily competing for the same hardwood logs used by paper mills to produce pulp. Both are paying more because loggers have to pay so much more for diesel fuel, paper industry officials say.

The rush to buy more firewood is having an impact on heating oil dealers.

Last year, heating oil consumption fell 13 percent nationwide, in part because of homeowners' fuel efficiency efforts, said John Huber, president of the National Oilheat Research Alliance. Huber expects consumption to drop again this winter, but not by as much.

The environmental impact of the shift from oil to wood is unclear. State-of-the-art woodstoves are cleaner than older models, but particulate emissions remain higher than those of oil furnaces. Emerging wood-burning technology promises to be even cleaner.

Associated Press writer Clare Trapasso in Concord, N.H., contributed.
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