Wood pellets are the fuel most commonly used in pellet stoves. All wood pellets are biomass materials, that is, products of commonly grown plants and trees. The most common residential pellets are made from sawdust and ground wood chips, which are waste materials from trees used to make furniture, lumber, and other products. Resins and binders (lignin) occurring naturally in the sawdust hold wood pellets together, so they usually contain no additives. Nut hulls and other materials are pelletized in some areas, and unprocessed shelled corn (see corn pellets) and fruit pits can be burned in some pellet stove designs (see corn pellet stoves).         

Your fuel of choice and its price may depend on the waste biomass most available to pellet mills in your region. In turn, your choice of appliance design depends on the fuel available.

Part 1: Source

In the US, pellet mills across the country receive, sort, grind, dry, compress, and bag wood and other biomass waste products into a conveniently handled fuel. Today, over sixty pellet mills across North America produce in excess of 610,000 tons of fuel per year, a figure that has more than doubled in the last five years. Pellets are available for purchase at stove dealers, nurseries, building supply stores, feed and garden supply stores, and some discount merchandisers. Pellets are usually packaged in forty pound bags and sold by the bag or by the ton (fifty bags on a shipping pallet). Some mills offer twenty pound bags for easier handling.

Part 2: Common characteristics

Although the chemical constituents and moisture content of different biomass materials vary, the Pellet Fuel Institute has identified common characteristics and developed fuel standards. These voluntary industry standards assure as much uniformity in the final product as is possible for naturally grown materials that become processed, but not refined fuel. PFI graded fuel must meet tests for:

• Density: consistent hardness and energy content (minimum 40 pounds/cubic foot) 
• Dimensions: length (1½" maximum) and diameter (1/4"or 5/16") to assure" predictable fuel amounts and to prevent fuel jamming 
• Fines: limited amount of sawdust from pellet breakdown to avoid dust while loading and problems with pellet flow during operation (amount of fines passing through 1/8" screen no more than .5% by weight)" 
• Chlorides: limited salt content (no more than 300 parts per million) to avoid stove or vent rusting 
• Ash content: important factor in maintenance frequency.

Part 3: Differences between premium and standard grade fuel

All of the measurable characteristics defined by PFI standards are the same for both fuel grades except ash content. Standard grade pellet fuel (up to 3% ash content) is usually derived from materials which result in more residual ash, such as sawdust containing tree bark (which contains more impurities) or agricultural residues like nut hulls. Standard pellets should only be used in stoves designated for their use. 

Premium grade pellet fuel (less than 1% ash content) is usually produced from hardwood or softwood sawdust containing no tree bark. Ash content varies in premium fuels from about 0.3% in some western softwoods to about 0.7% in eastern hardwoods. Premium pellets, which make up over 95% of current pellet production, can generally be burned in stoves calling for either standard or premium fuel. Increased availability of standard fuel is anticipated as stove designs continue to improve ash tolerance. 

Ash content determines fuel grade because of its role in maintenance frequency. It is the prime factor that determines maintenance frequency of ash removal from the appliance and venting system. In early pellet stove designs, fuel compatibility was the critical factor that determined whether a stove worked well or not. Fuel grade and specific ash content within a fuel grade are still to be considered, but advances in pellet stove technology are making fuel choice wider and easier. The size of the ash drawer, fuel feed and grate design, proper venting, correct operation and maintenance all play a part in maintenance frequency.

There are a number of variations in pellet fuels that are not included in PFI standards. For example, Btu (heat) content may range from just under 8,000 to almost 9,000 Btu, depending upon species and region of the country. 

Other characteristics like trace minerals in pellet raw materials vary not only from region to region, but even in close by growing areas. Some trace minerals promote clinkering, the formation of clumps of fused ash that can block air inlets in the burn pot. A fuel's tendency to form clinkers in a stove cannot be predicted by laboratory analysis both because of variations in the raw materials and the different burning conditions that affect the process. Clinkering can increase routine maintenance, but professional recommendations for matching available fuels to stove design can minimize the problem. Pellet mills strive for consistency despite the nature of the raw material. Slight variations in fuel even from bag to bag are inevitable, but the differences are usually insignificant and much smaller than found in the original raw material before processing. 

Part 4: Cost

In the US, pellets are sold by the bag (40 lb), by the ton (50 bags), and by the skid (60 bags). In 2010–11, typical selling prices ranged from $180 to $260 per ton ($3.60 to $5.20 per bag) and averages about $220 per ton ($4.40 per bag). Price varies by region, availability, and season, just like other heating fuels. 

Because bags of pellets stack and store easily, many prudent customers take advantage of lower off season prices and ensure their winter fuel supply by buying early. Selling price, of course, is only a part of the cost picture. The primary issue is the cost of energy, which is measured in dollars per million British thermal units. Pellets purchased at the average $150 per ton and burned in a typical pellet stove cost about $11.50 per million Btu, a figure that is less than the cost of electric heat and competitive with average energy costs of some other fuels. The actual cost of heating a home must take into account the insulation and tightness of the home, its size and layout, the level of comfort desired, and local climate. Other economic factors impacting energy costs, though hard to quantify, are also worth consideration. Biomass pellets reduce the use of dwindling fossil fuels, often imported from foreign countries. Every ton of waste material used in pellets reduces the rising costs associated with waste disposal. 

Run continuously, the average pellet stove consumes about one 40 lb bag of wood pellets every 24 hours for every 1,500 square feet being heated. Pellet consumption varies depending on overall home efficiency and stove settings. 

Part 5: Advantages

The first appeal of pellets is their convenience. Bags of pellets stack compactly and store easily. A ton of pellets can be stacked in an area as small as four feet wide, long, and high, an area about half the space needed for a cord of wood. Bags of pellets can be stored in a small area of a dry garage, basement, or utility room or shed. 

Pellets are also convenient because they load easily and cleanly into the stove hopper. Loading the hopper is normally required only once a day and may be even less frequent when the stove is used on low settings. The small size of pellets allows for precisely regulated fuel feed. In turn, combustion air can be regulated easily for optimum burn efficiency since the amount of fuel in the burn pot is predictable and consistent. High combustion efficiency is also due to the uniformly low moisture content of pellets (consistently below 10% compared to 20 to 60% moisture content in cordwood). Uniformly low moisture, controlled fuel batches, and precisely regulated combustion air means high heat output and a very low level of unwanted emissions . 

Other environmental benefits besides clean burns result from the use of pellet fuels. As a biomass fuel, pellets offer the advantages of sustainable energy supplies through renewable raw materials. Using pellets also helps reduce the costs and problems of waste disposal. In 1993-94, more than 6.5 million cubic yards of waste were diverted from landfills and converted to home heating in the form of pellets. As part of the tradition of the hearth, pellet burning offers the enjoyment of fire viewing and active participation in providing winter comfort in the home. 

Part 6: Pellet fuel glossary

ash: pellet stoves produce two kinds of ash:

1)solid ash residue in the firepot

2)fly ash (unburnt particles) that becomes air born (sparklers) during the combustion process.Pellet stove designs vary and have different methods of disposal. Some ash accumulates in "adh traps" which need to be cleaned periodcally. The remaining ash (fly ash) accumulates in, or is blown out of the venting.

fines: Fines (sawdust) are caused by pellet disnte gration at the mill or in subsequent handing. They cause two potential problems: dust in the home when the hopper is filled and possible interference to the flow of pellets as the pellets are transported to the burn system.

Size: Usually no problem except that smaller pellets usually feed more pounds per hour on the same stove setting, which could affect the balance of air-to-fuel. Long pellets might cause "bridging" (starving the fuel delivery system).