Pellet Fuels Institute Membership Meeting Wednesday, February 29, - PowerPoint PPT Presentation

Pellet Fuels Institute Membership Meeting Wednesday, February 29, 2012 Don Johnson, HPBA Director of Market Research

Agenda • Hearth appliance shipment statistics • Pellet appliance shipment statistics • Biomass central heating shipment statistics

Own Fireplace/Stove in Primary Residence 2010 Study Own Fireplace Gas Fireplace only: 75% Owners Own Both Fireplace Owners 1.6 Millions Households Fireplace (n=1,996) Gas and Stove: with a Pellet Stove stove 10% 33% Own stove only: Wood Total Respondents (n=3,560) 15% Natural stove Propane gas 46% 24% Pellet Fireplace/Stove 76% Owners (n=2,500) stove Other 10% 11% Gas Stove Stove Owners Approximately 112 Million Owners (n=504) Households in the U.S.

“Top of the Line” Hearth Industry Shipment Statistics

U.S. Hearth Appliance Shipments in 2011 • Cordwood – 197,181 • Gas* – 573,468 • Pellet – 62,451 • TOTAL – 833,100 Electric Hearth Appliance Shipments – 1,550,000 *Includes Gas Log Estimated Data (237,500)

U.S.Hearth Appliance Shipments by Type of Fuel -- 2011 Pellet 7% Cordwood 24% Gas* 70% *Includes Gas Log Data Electric Hearth Estimates Excluded

Between 2010 and 2011 . . . Overall, industry • Cordwood appliance shipments declined 10% decreased 15% between 2010 – From 230,948 to 197,181 and 2011 • Gas appliance shipments decreased 12% – From 650,911 to 573,468 • Pellet appliance shipments increased 41% – From 44,288 to 62,451 Electric hearth appliance shipments increased 11% between 2010 and 2011

Since 1998 . . . Overall, industry • Cordwood appliance decreased 64% shipments decreased 70% between 1998 – From 652,500 to 197,181 and 2011 • Gas appliance shipments decreased 64% – From 1,611,750 to 573,468 • Pellet appliance shipments increased 83% – From 34,000 to 62,451 Electric Hearth Estimates Excluded

Total U.S. Hearth Appliance Shipments 1998--2011 3,000,000 The downturn has stabilized? 2,500,000 2,000,000 1,500,000 1,000,000 t a n i l e v e l t s e 500,000 w o L s r a e y 3 1 0 8 9 0 1 2 3 4 5 6 7 8 9 0 1 9 9 0 0 0 0 0 0 0 0 0 0 1 1 9 9 0 0 0 0 0 0 0 0 0 0 0 0 1 1 2 2 2 2 2 2 2 2 2 2 2 2 Electric Hearth Estimates Excluded

U.S. Hearth Appliance Shipments 1998--2011 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 8 9 0 1 2 3 4 5 6 7 8 9 0 1 9 9 0 0 0 0 0 0 0 0 0 0 1 1 9 9 0 0 0 0 0 0 0 0 0 0 0 0 1 1 2 2 2 2 2 2 2 2 2 2 2 2 Cordwood Gas Pellet

U.S. Pellet Appliance Shipments 1992--2011 8 out of the Last 12 Years 160,000 Have Seen Increases 140,000 120,000 But 3 out of the Last 5 Years Have Seen Declines 100,000 80,000 60,000 40,000 20,000 Early Estimates 0 Somewhat Overstated? 2 4 6 8 0 2 4 6 8 0 9 9 9 9 0 0 0 0 0 1 9 9 9 9 0 0 0 0 0 0 1 1 1 1 2 2 2 2 2 2

U.S. Pellet Appliance Shipments 2011 Southeast Pacific 5% 9% Mountain 7% Central 9% Northeast 52% Great Lakes 18%

U.S. Freestanding Stove Appliance Shipments by Type of Fuel -- 2011 Gas 15% Pellet 34% Cordwood 51%

Pellet Stoves vs. Freestanding Stoves Percent of Pellet Stoves vs. Freestanding Stoves 2004-2011 Dollars 60% 51% 54% 51% 50% 39% 34% 40% 32% 40% Percent 30% 34% 42% 42% 30% 37% 23% 20% 26% 23% 23% 10% Units 0% 2004 2005 2006 2007 2008 2009 2010 2011 Year

% of Reps Who Feel Pellet Appliance Sales are Up Compared to a Year Ago Quarterly--June 2000 through January 2011 100% 90% 80% 70% 60% 50% 100% 100% 100% 100% 97% 94% 87% 88% 86% 83% 40% 78% 70% 70% 69% 67% 66% 30% 61% 57% 57% 57% 52% 44% 43% 20% 36% 35% 31% 27% 24% 21% 10% 20% 20% 19% 17% 17% 16% 15% 13% 8% 8% 8% 7% 0% 0% 0% 0 1 2 3 4 5 6 7 8 9 0 4 4 5 5 5 6 6 6 7 7 7 8 8 8 9 9 9 0 0 0 1 0 0 1 1 1 2 2 2 3 3 3 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 n n n n r l t n r l t n r l t n r l t n r l t n r l t n r l t n p c r p c r p c r p c u u u u u u u p p p p p p p c c c c c c c u e a u e a u e a u e a a a a a a a e e e e J O J O J O J O J O J O J O D D D D A A A A A A A J S M J S M J S M J S J J J J J J J Measurement Scale Changed April 2006

Central Heating Systems Fueled with Biomass Fuels • Program started 2Q09 • Two categories collected: – Central Heating Systems fueled with Pellets – Central Heating Systems fueled with Cordwood/Wood Chips

Central Biomass Heating Units Shipped Since April 2009 4000 3500 3000 2500 2000 1500 1000 500 0 2009* 2010 2011 Pellet (US) Pellet (Canada) Wood Chip (US) Wood Chip (Canada) *April 2009 through December 2009

Pellet Appliance Observations • Pellet Appliance Shipments and Sales are the most volatile in the hearth industry • When the consumers view the price of heating their home to be expensive , then sales and shipments dramatically increase • When the consumers view the price of heating their home to be reasonable , then sales and shipments are much less robust

Questions?