Wood pellets in high demand, short supply in West Virginia

Nov 22, 2005. /Lesprom Network/. The wood pellet manufacturer Lignetics of West Virginia is struggling to meet demand for its product from consumers switching to wood heat because of the high cost of oil, gas and electricity. Ken Tucker, Lignetics president and CEO, said some of the wholesale customers who buy from Lignetics in Glenville are having to look further west. Pellet manufacturing plants in Montana, Idaho, Washington and Oregon have an excess of inventory because of mild winters in the past few years, Mr. Tucker said. The energy department predicts winter heating bills will be a third to a half higher this winter than last for most families in the United States - an average of $350 more for natural gas users and $378 more for fuel oil users. In West Virginia, an increase of residential rates approved by the state public service commission for natural gas went into effect November 1. The residential-rate increases ranged from 21% for Dominion Hope to 31% for Mountaineer Gas, the largest natural-gas utilities in the state, said PSC deputy consumer advocate Byron Harris. High costs are being blamed on hurricanes Katrina and Rita, which damaged oil and natural gas installations in the Gulf Coast. Ron Leofsky, spokesman for Allegheny Pellet Corp. in Youngsville, Pennsylvania, said many plants in the East are running 24 hours, seven days a week to meet the pellet demand. "There was a panic buy of pellet stoves in September and October in fear of the high gas and oil prices," he said. "That quick decision put a strong demand on our inventory." Morgantown area retailers are selling out of wood pellets. "We can't keep them in stock. We haven't had them back in since Halloween," said James Sanders, an employee of Lowe's in Morgantown. Chuck Catania, owner of Mountaineer Power and Equipment in Grafton, sells pellet stoves, wood stoves and pellets. "There is not a shortage of pellets, there is a shortage of pellets getting to us in a timely fashion," he said. "More and more stoves are being sold and that means more pellets are needed." Mr. Catania said that in addition to the higher demand, many people have waited until the onset of cold weather to buy their pellet supply. "If they want to pay bottom-line price, they should get their pellets May through September for the coming winter," he said. Pellets sell for around $4 for a 40-pound bag. The average household uses about three tonnes of pellets during the winter.