Wood Pellets vs Gas: Why 2026 Makes the Switch Worth Calculating
Wood pellets now cost 7.2p/kWh versus 6.04p for mains gas. But the real saving lies in efficiency ratings and heat output. Here's what you need to know.
The gap between mains gas and wood pellets has narrowed significantly. At current Ofgem-capped rates, mains gas costs 6.04p/kWh while wood pellets sit at 7.2p/kWh—a difference of just 1.16p per unit. For many homeowners, that small price premium masks a more nuanced story about efficiency, installation costs, and long-term value.
Why Price Per kWh Doesn't Tell the Full Story
What matters isn't just the unit cost—it's how much usable heat reaches your home. A modern wood pellet boiler typically operates at 85-95% efficiency, while condensing gas boilers reach 90-98%. However, heat loss through flues, pipework, and poor insulation can eat into those gains significantly.
If your home has:
- Poor loft insulation (under 200mm)
- Single-glazed windows
- Uninsulated cavity walls
- Drafty doors and gaps
...then neither fuel choice will deliver maximum value. Efficiency improvements come first.
The Real Action You Should Take Now
Get a professional boiler efficiency audit. Before switching fuels or upgrading equipment, you need baseline data on:
1. Current heat loss through your building envelope
2. Boiler age and actual efficiency (not nameplate figures)
3. Radiator or underfloor system performance
4. Hot water cylinder losses
A qualified surveyor costs £150–300 but will identify whether you're losing £300+ annually through preventable heat escape.
Comparing Your Options
Mains gas remains the cheapest per unit, but requires:
- Annual safety checks (£120–180)
- Pipeline dependency
- No flexibility if supply issues emerge
Wood pellets offer:
- Bulk buying potential (often cheaper in summer)
- Independence from grid disruption
- Higher upfront boiler costs (£6,000–12,000 vs. £2,500–5,000 for gas)
- Storage space requirements
Wood pellets make sense if you can store 5–10 tonnes and plan to stay in your home for 10+ years. Compare wood pellet prices to see current supplier rates in your area.
The Efficiency-First Strategy
Before switching fuels, upgrade your building fabric:
- Add loft insulation to 270mm minimum (£400–800)
- Draught-proof windows and doors (£200–500)
- Lag exposed pipework (£100–300)
- Consider secondary glazing in key rooms (£800–2,000)
These improvements reduce demand by 15–25%, cutting fuel costs regardless of whether you choose mains gas or renewables.
The Bottom Line
In July 2026, the fuel itself is secondary to how efficiently your home uses it. A well-insulated home with a 25-year-old gas boiler will beat a poorly-insulated home with new renewable heating. Start with efficiency audits, then decide whether wood pellets or gas makes sense for your circumstances.