Wood Pellets Now Cheaper Than Gas: Should You Switch?
With wood pellets at 7.2p/kWh versus mains gas at 6.04p/kWh, the gap is closing. Here's how to decide if biomass heating makes financial sense for your home.
The economics of home heating are shifting. Wood pellets now cost just 19% more per kilowatt-hour than mains gas, a margin that's narrow enough to warrant serious consideration for homeowners with existing boilers or those planning upgrades.
At 7.2p/kWh, pellets remain more expensive than gas's Ofgem-capped 6.04p/kWh, but the comparison becomes far more nuanced when you factor in efficiency rates, available grants, and long-term energy security.
Why the Numbers Matter
Mains gas boilers typically achieve 85–90% efficiency, while modern pellet boilers often reach 90%+ efficiency. This means:
* A gas boiler needs 100 units of fuel to deliver 88 units of heat
* A pellet boiler needs 100 units of fuel to deliver 92 units of heat
When you adjust for efficiency, the real cost-per-unit of usable heat narrows further. For a household burning 10,000 kWh annually, switching from gas to pellets could cost roughly £150–200 more—before grants.
The Grant Advantage
The Boiler Upgrade Scheme currently offers £5,000 toward biomass boiler installation. Heating oil users—paying 97.2p/litre—face even starker choices. Oil costs approximately 12.8p/kWh, making both gas and pellets significantly cheaper alternatives.
If you're on oil and considering a switch, compare wood pellet heating options against mains gas availability in your area.
Who Should Actually Switch?
Biomass heating makes sense if you:
* Live beyond the mains gas network (rural properties)
* Have space for a pellet storage tank or silo
* Plan to stay in your home for 10+ years
* Value energy independence over absolute lowest cost
* Are currently on heating oil
It makes less sense if you:
* Have an efficient gas boiler installed within the last 5 years
* Lack adequate storage space
* Live in areas with poor pellet delivery infrastructure
What About Electricity?
At 24.5p/kWh, mains electricity remains the most expensive heating fuel by far—nearly 4× the cost of gas. Heat pump technology improves this picture through efficiency gains, but the upfront cost remains substantial. Most homeowners should prioritize comparing gas and oil options before considering electric heating.
Your Next Step
If you're paying more than 6.5p/kWh for heating, request a free survey from a biomass installer. The difference between your current fuel cost and 7.2p/kWh may disappear entirely once you account for boiler efficiency and available government support.
Don't assume your current fuel is the cheapest option. Rising energy volatility means last year's calculations no longer hold. Compare your actual annual consumption against current market rates for all available fuels in your area.