Long live the pellet stove rebate

Today is the last day to file for your Residential Wood Pellet Appliance Rebate — 25 per cent back on the price of a newly purchased pellet stove or furnace, up to $1,000 and $1,500 respectively.

The program has been in place since April of 2008, but plans to maintain it have not been announced.

Rex Philpott, owner of Cottles Island Lumber Company, is sure the province will renew the plan.

“We’re certainly asking for that,” he said. “I think to not renew it would be zigging when the rest of the world is zagging. Every other jurisdiction in North America is coming on line with these — to do away with the rebate would be a backwards step for the province.”

But even with the rebate, pellet stove sales have been minimal.

“I think to not renew it would be zigging when the rest of the world is zagging.” –Rex Philpott

Peter Parsons, sales manager at The Tin Man Inc. in Corner Brook, said that pellet stoves and furnaces don’t account for much business.

The rebate “stimulated sales a little bit,” he said. “But we only sell maybe an average of, I’m going to say, 10 – 15 pellet stoves a year.”

That’s 10-15 out of “a couple hundred.”

Parsons has a pellet stove in his home right now (he likes to know what he’s selling) but isn’t thrilled with the experience.

“Pellet stoves are convenient, don’t get me wrong,” he said.

But, Parsons also notes that “you can actually heat your home for a lot cheaper with a high efficiency wood stove. This year, so far, I’ve burned two pallets of pellets … that’s 110 bags — that’s $900. If I was to buy wood, $900 worth of wood — that’s about enough for about two winters worth of wood for me.”

Not to mention the fact that pellet stoves need electricity to run, which makes makes it hard to heat your home when the lines go down.

Government’s role

“I think it’s kind of misleading what they’re doing,” said Parsons. “The government themselves are sinking money into the industry. And to help pay for what they’re doing they’re trying to get people to buy the pellet stoves so they get their money back from the pellet plants. I don’t think that it’s worth it.”

One of the companies that the government is supporting is Exploits Pelletizing Inc., a division of Blanchard’s Cabinet Doors. Owner, Rodney Blanchard received a $75,000 term loan from the provincial government in 2008 to expand into pellets, which he makes out of the waste generated by his cabinet door production.

Last summer, Blanchard shut down the operation for a couple of months, having reached his storage capacity. There’s no word on whether he’ll have to do it again this summer, but he says that Exploits Pelletizing is definitely making pellets faster than it’s selling them.

Blanchard says the province should be doing more to raise awareness about the stoves.

“A lot of people are just finding out about about the rebate program. I think they need to do more TV ads and get it out there more.”

Cottles is also operating significantly under capacity. “We’ve got capacity to make 10,000 tonnes,” said Philpott. “And so far, we’re running at 20 per cent capacity.”

He says business has been up maybe 50 per cent this year, but that’s up from almost nothing. It’s still not anywhere close to where they’re hoping to be.

The province has provided a rebate on 515 appliances since 2008. 108 rebate applications were approved this year in the cycle, down from 136 the year before, and 271 the first year the program ran.

Finding the right market

According to Heather MacLean, director of communications for the Department of Natural Resources, the program ends today.

“The department has no programming beyond this year to develop further pellet manufacturing capacity. Any further development of pellet production capacity into the future will depend on the future evolution of the industry and, in particular, markets for these products,” she said via email.

“The department has no programming beyond this year to develop further pellet manufacturing capacity.” –Heather MacLean

If Philpott had his say, one of those markets would be public buildings.

“The big issue is, ‘Is this a technology I trust to heat my home with?,'” said Philpott. “That’s just as big an issue as the cost of installing an appliance. When people are familiar with the idea, when they realize, ‘Hey, the office building I’m working in is heated with pellets, the school my kids are going to is heated with pellets,’ they’ll feel a whole lot more comfortable putting a pellet appliance in their home and counting on it.

“So, that’s where we see that going,” said Philpott. “One market can drive the other one, but the residential by itself will go very, very slowly.”

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