Wood Seen as Popular, Cheap Option to Heat Homes

NEW YORK (MainStreet) — Many consumers are still avid fans of using wood to heat their homes despite other more eco-friendly alternatives such as renewable energy.

The reliance of burning wood as a main heating source is popular throughout the U.S., but its use has increased by 50% in the Northeast and Middle Atlantic regions from 2005 to 2012, said the Energy Information Administration.

Wood remains a popular heating source, and consumers are still buying split logs and wood pellets in droves in the nine states from New England and Middle Atlantic census divisions.

Wood chips are commonly sold at Lowe's and other home improvement retail stores in the Northeast, Southeast and Northwest parts of the U.S. because of the availability and proximity to the source, said Craig Marcum, managing partner at Edge Energy, a brokerage in Houston.

"The closer you are to the coasts where most of the wholesale market is, the better you are," he said.

Consumers have sought cheaper options such as wood for many years and are foregoing the use of fuel oil and kerosene, the EIA said.

Across the U.S., 2.5 million households or 2.1% of the population now use wood as the main fuel to heat their homes, an increase from 1.9 million households or 1.7% in 2005. There are another 9 million households, or 7.7% of Americans, who use wood as a secondary heating fuel.

Most homes rely on using heating stoves as their primary source and fireplaces are the next common choice, the report said. While most consumers are burning split logs, more people are buying wood pellets in the past few years.

What's more, while homes with higher income brackets "are more likely to use wood, those at lower income levels who burn wood consume more on average," the EIA said.

Finding cheaper alternative fuels which are eco-friendly remains a challenge for consumers still, Marcum said. Using biodiesel fuels or other fuels is still not obtainable for most people.

"Alternative fuels are local in nature," he said. "Every single one of them is driven by receiving subsidies by the federal and state governments. Alternative fuels are more expensive to develop and build and cost more for the consumer."

While the use of wind and solar energy is gaining in popularity and availability, many limitations still exist depending on what state you reside in, Marcum said. Finding the right balance between the higher costs for using renewable energy and seeking better options for the environment remains tricky and difficult right now, he said.

"We can't afford to go strictly for the wallet," Marcum said. "I don't think we as a country will ever go strictly on the wallet. I think most leaders in the energy sector believe in the same thing – there has to be an environmental aspect to it."

Another potential option for consumers in the near term is using hydrogen to heat and power their homes. HyperSolar (OTCMKTS:HYSR), the Santa Barbara, Calif. hydrogen producer, is working on commercializing their technology so that consumers can use their method at home for heat and electricity. The company's technology splits water molecules and isolates and harvests hydrogen. The particle technology uses thousands of tiny solar cells which are immersed in water. When the sun hits the particles in water, it splits the water molecules and produces hydrogen.

"The reason it is a good option is because the hydrogen can be produced on site," said CEO Tim Young. "With a little bit of land and sun and using a clear vessel filled with waste water, the sun would hit the particles and produce hydrogen. The benefit of hydrogen is that it can be stored like oil and gas and produces clean emissions."

The current renewable technology for splitting water to produce hydrogen calls for a consumer to buy $4,000 to $6,000 in solar panels and an electrolyzer, an electrochemical device to convert electricity and water into hydrogen and oxygen, which ranges from $45,000 to $50,000 for a 2,000 sq. ft. home. Once a consumer makes the initial capital investment, they will have free energy to use, but the costs still remain prohibitive except for hydrogen enthusiasts and renewable energy adopters.

HyperSolar's technology could be available commercially within three to five years and could be up to 50% cheaper than the current renewable energy options such as using an electrolyzer, Young said. Its technology will likely be located near fueling stations for hydrogen cars or warehouses for power equipment and then adoption is likely to occur at homes and farms.

"We've made tremendous progress to get where we are now," Young said. "It will be the greenest form of energy available and our goal is to be on par economically with natural gas."

The adoption of using other forms of renewable energy has been slow because natural gas is a very inexpensive and plentiful fuel for heating options, he said.

--Written by Ellen Chang for MainStreet

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