Currently the NWT pellet market is estimated at 12,000 tonnes per year (tpy) increasing annually. The pellets are used for space heating needs. The supply comes from Alberta or BC, trucked and or barged north.
Wood pellet boilers have now been installed as retrofits in several large NWT government facilities. The home heating market is also expected to grow as homeowners become more familiar with wood pellet stoves, furnaces and home boiler systems. Unfortunately, houses are not designed for wood pellet fuel and homeowners are forced to use pellets in bagged form.
Despite the relative advantage of heating oil energy density compared to wood pellets, pellets have a distinct cost advantage. One tonne of wood pellets packs the energy equivalent of 513 litres of fuel oil or 741 litres of propane or 1 cord of cord wood.
In 2008 the Energy Efficiency Incentive Program in NWT was revised increasing the wood pellet furnaces and boiler rebates as follows:
•Pellet stove - $500 (approximate cost of new stove $2,500)
•Pellet residential furnace - $700 (approximate cost of new furnace $7,000)
•Pellet residential boiler - $1,000 (approximate cost of a new boiler $11,500)
Wood pellets are typically manufactured from sawmill wood residues. Sawmill planer shavings are the preferred feedstock as this source does not require any additional drying prior to pellet manufacture. Sawmill sawdust is the next most preferable source but it does require drying down to at least 15% moisture content.
A 2009 pre-feasibility study concluded that “Given the limited market size of the NWT wood pellet market (est. 12,000 tpy) the construction and financing of a wood pellet operation would be financially challenging”. A local firm has been working on a pellet plant for a number of years.
Ever increasing electricity rates provide an incentive for users to move to pellet stoves. However, the easing of fuel oil and propane prices of late would make pellet stoves less competitive.
The use of pellets in NWT accounts for an amazing ~8% of Canadian pellet consumption. (NWT has about 0.1% of Canada’s population).