Economies of scale do not currently favour small-scale installations and the higher capital costs associated wit wood fuelled boilers are a barrier to interested householders. Although pellets are currently marginally cheaper fuel than oil, capital and running costs for a pellet boiler compared to an equivalent oil system result in payback times of over 10 years at current prices. The situation is not helped by the standard rate of 17.5% VAT on procurement of wood boilers compared to 5% on most fossil fuel equivalents

The payback period will, ultimately, depend on the fuel being replaced and the type of wood fuel being used but will be more favourable in areas currently not on the existing gas grid.

• Carbon savings

There are common misconceptions over the environmental impact of producing and transporting wood fuels, however, in-depth studies have illustrated that the potential carbon savings arising from their use as fuel for heating still far outweigh perceived disadvantages. Even in a worse case scenario of having to use fossil fuels to dry sawdust, electricity to process the material to produce pellets, shipping to the UK from Canada and final road transport within the UK, the use of wood fuell would  more than halve the carbon emissions from a similar gas installation.

The vast majority of this carbon impact arises from having to dry the raw material, if this is not necessary or a biomass CHP plant is utilized, the carbon savings can be virtually 100% of alternative fossil fuels.