Is it still worth buying firewood now energy prices in Norway are lower?
High energy prices in Norway over the past two years have seen many turn to alternative sources of heat. However, with energy prices stabilising, is it still worth investing in the annual firewood delivery?
In the past couple of winters, Norwegians have tried to hedge against steep energy bills during the winter by purchasing firewood. This has been especially important due to sky-high energy prices in 2021 and 2022.
But is that still a wise choice, considering the fact that energy prices – and the broader energy market landscape – seem more manageable at the moment?
According to the Norsk Ved trade organisation for Norwegian firewood producers, around 1.3 million homes in Norway have a fireplace, in addition to some 450,000 holiday homes.
One of the key benefits of using firewood for heating is its relative stability in terms of cost. When you purchase firewood, you essentially lock in a fixed price for your heating needs, shielding yourself from the volatility of the energy market.
READ MORE: What you need to know about having a fireplace installed in Norway
How to calculate if firewood is still worth it
Given the current energy prices, and the efforts that both the European Union (EU) and Norwegian authorities have put into ensuring that the continent's energy needs are met, some may question whether investing in firewood is still necessary – or financially savvy.
Rune Østgård of Norsk Ved has previously broken down how to calculate the cost of using wood to heat a home to broadcaster TV 2. The calculations are based on wood with 20 percent humidity and a fire place of an efficency rating of 75 percent or higher.
The example price is based on a standard 40-litre sack of birch wood weighing approximately 15 kilograms.
According to Østgård, for every kilogram of wood, you'll receive approximately 4 kWh (kilowatt hours) of energy. To calculate the energy value of the wood in a 15 kg bag, multiply the weight by the energy value per kilogram:
15 kg x 4 kWh/kg = 60 kWh in one bag.
Now, let's determine the real cost of the wood. If you purchased the 40-litre bag for 99 kroner (the current going rate at the time of writing), divide the price by the number of kWh:
99 kroner / 60 kWh = 1.65 kroner per kWh.
This calculation reveals that, in this example, you're paying around 1.65 kroner per kWh for the wood.
With this information, you can now look at the price per kWh you're paying for electricity (or the price you expect to pay in the winter months) to find out if opting for firewood makes sense.
The price of electricity at the time of writing in western, southern and eastern Norway was around 0.82 kroner per 1 kWh (according to Bytt.no), making it the cheaper option. Energy in northern and central Norway is significantly cheaper, too, meaning energy is cheaper than wood there too.
The energy market expects an electricity price of approximately 1.50 kroner per kilowatt hour for the winter of 2023-2024, according to Tor Reier Lilleholt, an energy analyst at the consultancy Volue Insight.
It's also important to note that, Norway also has an energy subsidy scheme in place.
The electricity subsidy offers a 90 percent reduction on hourly electricity costs exceeding 70 øre (excluding VAT), which is approximately 87.5 øre when including VAT.
These prices also don't include other fees such as surcharges and grid rent charged by electricity companies. Therefore the price consumers pay for energy is higher than the raw price.
This means that during winter and when prices are highest, wood may prove to be the cheaper alternative.
Compare prices with multiple suppliers to find the best deal
If you decide to purchase firewood, it's important to check the prices with several firewood suppliers. Doing so lets you find the best deal for your heating needs.
Additionally, if you're considering buying a larger volume, such as 1,000 litres on a pallet, you can save significant money.
However, it's worth noting that larger pallets often consist of mixed wood varieties, each with varying energy content per unit weight.
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In the past couple of winters, Norwegians have tried to hedge against steep energy bills during the winter by purchasing firewood. This has been especially important due to sky-high energy prices in 2021 and 2022.
But is that still a wise choice, considering the fact that energy prices – and the broader energy market landscape – seem more manageable at the moment?
According to the Norsk Ved trade organisation for Norwegian firewood producers, around 1.3 million homes in Norway have a fireplace, in addition to some 450,000 holiday homes.
One of the key benefits of using firewood for heating is its relative stability in terms of cost. When you purchase firewood, you essentially lock in a fixed price for your heating needs, shielding yourself from the volatility of the energy market.
READ MORE: What you need to know about having a fireplace installed in Norway
How to calculate if firewood is still worth it
Given the current energy prices, and the efforts that both the European Union (EU) and Norwegian authorities have put into ensuring that the continent's energy needs are met, some may question whether investing in firewood is still necessary – or financially savvy.
Rune Østgård of Norsk Ved has previously broken down how to calculate the cost of using wood to heat a home to broadcaster TV 2. The calculations are based on wood with 20 percent humidity and a fire place of an efficency rating of 75 percent or higher.
The example price is based on a standard 40-litre sack of birch wood weighing approximately 15 kilograms.
According to Østgård, for every kilogram of wood, you'll receive approximately 4 kWh (kilowatt hours) of energy. To calculate the energy value of the wood in a 15 kg bag, multiply the weight by the energy value per kilogram:
15 kg x 4 kWh/kg = 60 kWh in one bag.
Now, let's determine the real cost of the wood. If you purchased the 40-litre bag for 99 kroner (the current going rate at the time of writing), divide the price by the number of kWh:
99 kroner / 60 kWh = 1.65 kroner per kWh.
This calculation reveals that, in this example, you're paying around 1.65 kroner per kWh for the wood.
With this information, you can now look at the price per kWh you're paying for electricity (or the price you expect to pay in the winter months) to find out if opting for firewood makes sense.
The price of electricity at the time of writing in western, southern and eastern Norway was around 0.82 kroner per 1 kWh (according to Bytt.no), making it the cheaper option. Energy in northern and central Norway is significantly cheaper, too, meaning energy is cheaper than wood there too.
The energy market expects an electricity price of approximately 1.50 kroner per kilowatt hour for the winter of 2023-2024, according to Tor Reier Lilleholt, an energy analyst at the consultancy Volue Insight.
It's also important to note that, Norway also has an energy subsidy scheme in place.
The electricity subsidy offers a 90 percent reduction on hourly electricity costs exceeding 70 øre (excluding VAT), which is approximately 87.5 øre when including VAT.
These prices also don't include other fees such as surcharges and grid rent charged by electricity companies. Therefore the price consumers pay for energy is higher than the raw price.
This means that during winter and when prices are highest, wood may prove to be the cheaper alternative.
Compare prices with multiple suppliers to find the best deal
If you decide to purchase firewood, it's important to check the prices with several firewood suppliers. Doing so lets you find the best deal for your heating needs.
Additionally, if you're considering buying a larger volume, such as 1,000 litres on a pallet, you can save significant money.
However, it's worth noting that larger pallets often consist of mixed wood varieties, each with varying energy content per unit weight.
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