Wood-fuelled heating systems, also called biomass systems, burn wood pellets, chips or logs to provide warmth in a single room or to power central heating and hot water boilers.

A stove burns logs or pellets to heat a single room – and may be fitted with a back boiler to provide water heating as well. A boiler burns logs, pellets or chips, and is connected to a central heating and hot water system. A wood-fuelled biomass boiler could save you up to £880 a year compared to electric heating.

The benefits of biomass heating
Affordable heating fuel
Although the price of wood fuel varies considerably, it is often cheaper than other heating options.

Financial support
Wood fuel boiler systems could benefit from the Renewable Heat Incentive.

A low-carbon option
The carbon dioxide emitted when wood is burned is the same amount that was absorbed over the months and years that the plant was growing. The process is sustainable as long as new plants continue to grow in place of those used for fuel. There are some carbon emissions caused by the cultivation, manufacture and transportation of the fuel, but as long as the fuel is sourced locally, these are much lower than the emissions from fossil fuels.
if you live in Scotland, view case studies and examples where homeowners have installed a wood-fuelled heating system.

Costs, savings and financial support
A biomass pellet stove will cost around £4,300 including installation. Installing a new log stove will usually cost less than half this, including a new flue or chimney lining.

For boilers, an automatically fed pellet boiler for an average home costs between £9,000 and £21,000, including installation, flue, fuel store and VAT at 5 per cent. Manually fed log boiler systems can be slightly cheaper.

Pellet costs depend mainly on the size and method of delivery. If you have room for a large fuel store that will accept several tonnes of pellets at a time, delivered in bulk by tanker, you can keep the cost down to around £230 per tonne in most parts of the UK.

Logs can be cheaper than pellets, but costs depend on the wood suppliers in your local area, as they cost a lot to transport.If you have room to store more than a year’s worth of logs you can save money by buying unseasoned logs and letting them season for a year. Search for wood fuel suppliers in your area at Log Pile.


Savings in carbon dioxide emissions are very significant – up to 15.4 tonnes a year – when a wood-fuelled boiler replaces a solid (coal) fired system or electric storage heating. Financial savings are more variable – if you replace an older gas heating system with a wood-burning system you might save up to £70 a year, but if you are replacing an old electric heating system you could save as much as £880 per year. This table shows how much you could save by installing pellet central heating in a typical four-bedroom detached house with basic insulation.

England, Scotland and Wales

Existing systemFuel bill savings (£/year)Renewable Heat Incentive (RHI) payment (£/year)

1 April 2015 to 30 June 2015
Carbon dioxide savings (kgCO2/year)
Electricity (old electric storage heaters)£490 to £880£1,730 to £2,6109,700 to 15,700 kg
Oil older (non-condensing)£130 to £1405,600 to 8,200 kg
LPG older (non-condensing)£970 to £1,3905,300 to 7,800 kg
Coal£300 to £460 10,100 to 15,400 kg
Gas older (non-condensing£10 to £70 4,600 to 6,800 kg