Friday, January 26, 2007

The High Price of Wood Pellets

My elderly next door neighbors have a pellet stove they bought to replace a 50 year old oil furnace. They decided on the pellet stove because the price of pellets was low and they felt the could heat their home cheaper than any other way. That was 7 years ago and pellets were under $100 a ton. On cold days they use a 40# bag of pellets a day, so a ton would last 50 days. Their heating bill was about $200 a year. Now pellets are $220 a ton if you can find them, so the cost of pellets has more than doubled in the past 7 years. That's a pretty steep rate of inflation. Makes it tough for a couple on a fixed income. My gas bill has increased, but certainly not doubled, but of course the gas company is regulated by the government. My guess is that the pellet manufacturers have taken a lesson from the oil companies and have created their own windfall profits. It is interesting that the gasoline prices have continued to drop since the election. Now that the Dems are in control and not their Republican buddies, the oil companies are probably afraid of an investigation into their pricing practices. I figured that prices would go back up if the Reps won in November. I guess we'll never know. Of course, here in Oregon the gasoline prices haven't gone down much, certainly not as much as the rest of the country.

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