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Craig McCausland installs a wood-burning fireplace insert at Patricia Johnson’s condo in Falmouth on Friday. A federal tax credit will cut her cost by 30 percent.

Gregory Rec/Staff Photographer

Just over a year ago, average heating oil prices in Maine were hovering around $3.50 a gallon. Firewood dealers were running out of dry logs. Wood and pellet stoves were back-ordered. Mainers were cranky, and worried.

This heating season, a gallon of fuel oil is a buck cheaper, on average. Seasoned cordwood is available. Stoves are too, although sales seem to be benefiting as much from a federal tax credit as anything. Mainers aren't celebrating, especially in households stung by job losses, but the overall panic has subsided.

"The sense of urgency isn't as acute as last year," said John Kerry, the state's energy director. "The intense interest we experienced last year isn't as great, at this point in the heating season."

Oil remains the dominant heating fuel in Maine, and prices have been on a roller coaster. After hitting record highs that flirted with $5 a gallon in 2008, oil began sliding as the recession took hold, crashing to $2.07 last spring. Prices then began an uneven rebound through the summer, taking a 20-cent-per- gallon leap over the past few weeks.

With so much volatility, Kerry and other experts say this year's relative lull presents an opportunity to prepare for the next big spike.

"Prices are going to go back up again when the economy recovers," Kerry said.

Patricia Johnson moved last year to a condo in Falmouth that has a kerosene heater, which was fine until she lost power in a winter storm. Last week, she had her fireplace chimney relined and a Hampton wood-burning insert installed. The heater and chimney work ran more than $3,000, but a federal tax credit earmarked for energy improvements will cut the cost by 30 percent. The program runs through 2010.

"I'm taking advantage of the stimulus money, no doubt," she said.

The tax credit is driving lots of sales now, according to Patrick Thompson, manager at Finest Hearth & Home in Yarmouth. People aren't desperate, like last year, he said. They just want to be ready.

Pellet stoves also qualify for the tax credit, but the mad rush to pellets has eased, according to Ernie Stanhope, owner of Embers Stoves & Fireplaces in South Portland. Manufacturers couldn't meet demand last year, and many people who ordered stoves waited months for delivery. That generated bad publicity.

Another factor: The average prices of oil and cordwood have gone down over the past year, but pellets haven't. They range from $260 to $300 a ton, not including delivery. That means pellets aren't much cheaper today than oil, according to government calculations that factor in burner efficiencies.

Cordwood is the least-costly fuel, if it's dry and burned efficiently.

Business has been steady at Southern Maine Firewood in Gorham. But it's not like last year, when the company had a six-month wait, ran out of seasoned wood and stopped taking orders in June.

"It's busy, but there's not as much demand all at once," said Shellee Zaharis, the office manager.

A cord of seasoned firewood sells for $255 this year, down from $300 last year. Regular customers who can heat with both oil and wood seem to be ordering fewer cords this year, Zaharis said.

"Whatever is cheaper, that's what people are going toward," she said.

People who burn oil also had to decide earlier this year whether to buy contracts that fix or cap prices during the heating season. Some Mainers took a bad gamble last year and locked in when oil was at near-record levels. They were stung when prices collapsed last winter. But this past summer, when oil had dipped to $2 a gallon, the odds seemed better, according to Jamie Py, executive director of the Maine Energy Marketers Association.

"There were a lot of contracts sold this year," he said. "They looked like a good deal."

Oil customers also seem to be more content this year, according to Les Thomas, owner of Cash Energy in Scarborough. Thomas advertises below-average prices, and took on a lot of new customers last year looking for relief. This year, there's not as much shopping around, he said. Maybe people just accept prices in the $2.50-a-gallon range as reasonable, he said.

Despite that, both Py and Thomas say dealers recognize that many households will have trouble paying for oil. At this time of year, when it's typical to fill the tank, many people can only afford 100 gallons at a time, Thomas said.

Maine's neediest families will be getting help again from the federal Low Income Home Energy Assistance Program. More than 60,000 households received LIHEAP money last year, and the state will get $13.1 million this month for initial payments. The average benefit this year will be roughly $750 per recipient.

Low-income households also qualify for a subsidized program that sends contractors to do basic air sealing and insulation. That cuts fuel consumption. Early next year, a new government program will be ramping up to extend weatherization grants and loans to middle-income Mainers.

In the meantime, many homeowners are taking advantage of existing tax credits to make energy improvements.

"The tax credit has been very good for business," said Keith Baumm, owner of the USA Insulation of Maine franchise in Portland. "We're booked out over a month."

There's enough demand now, Baumm said, for another truck and more workers.

Baumm's company conducts a basic energy audit and typically pumps a special foam into walls that have no insulation. It also insulates the attic. It's common for a job costing $3,000 or so to pay for itself in fuel savings in less than four years, he said, faster with the available 30 percent federal tax credit.

"The only thing we can really do is conserve and be efficient," Baumm said.

In Falmouth, Johnson has been following that advice. She had a professional energy audit done last winter that identified big insulation gaps in her 32-year-old home. She's now planning to have insulation added to the crawl space and a chilly area between the kitchen and attached garage.

With a wood-burning fireplace insert and a tighter house, Johnson plans to be in a better position to cope with changing energy prices in the years ahead.

Staff Writer Tux Turkel can be contacted at 791-6462 or at:

tturkel@pressherald.com