Federal and State Grants for Wood-Burning Furnace Installation


Wood-burning furnaces also are known as biomass stoves, wood-burning boilers and hydronic heaters. They are used as an alternative heating source to gas or electric heaters. Wood-burning furnaces mostly are used in rural areas where access to wood and natural fibers is more readily available. The federal government offers grants and tax credits to retrofit homes and business with wood-burning furnaces that are rated to have a low impact on the environment.

Federal Grants

  • The U.S. Department of Agriculture offers grants of up to $500,000 for renewable energy systems including wood-burning furnaces to farmers, ranchers and small businesses demonstrating financial need. Contact your state's Rural Development Office to apply.

State Grants

Federal Tax Credits

  • The federal government will give a $1,500 tax credit for Energy Star-approved biomass stoves bought before Dec. 31, 2010. The stove must be used in an existing home and the home must be your principal residence.

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