Y.G. Lee
Executive Vice President Jusung Engineering

Everyone loves a fireplace. But chopping and storing and constant stoking firewood can be a drag. Not to mention the worry about whether or not you put out the fire before you go to sleep. Moreover, wood smoke contains hundreds of chemical compounds that can affect your health, and is a major contributor to pollution. So what are we supposed to do? Rest assured there’s an alternative that’s not only convenient, but also cost-effective and environmentally friendly. It’s called the pellet stove.

Drawing on these benefits, pellet stoves have gained ground worldwide, and Japan is at the forefront of this trend. In Japan, Sunpot takes up nearly 50 percent of the domestic market and stands out among the most successful pellet stove manufacturers. The company signed a co-production agreement with Iwaki Prefect in June 2002 and entered into mass production from October 2003. Initially, their target customers only included businesses, which explain the big stoves they had been turning out. Over time, however, smaller stoves started to roll off the production line for household customers.

There was another ingredient for their success: versatility. The pellet stove can run on all kinds of pallet fuel.

Pellet stoves have gained ground worldwide, and Japan is at the forefront of this trend. In Japan, Sunpot takes up nearly 50 percent of the domestic market and stands out among the most successful pellet stove manufacturers

Joining Hands with Local Government

Sunpot started off as a big petroleum stove manufa c t u r e r f o r business customers. Their customers mainly live in colder, northern areas such as Hukkaido. Hence, relocation plans to reduce costs. In October 2001, they opened a new production facility in Hanamaki City, Iwaki Prefect.

Soon afterwards, the managers were delighted to hear a project proposal from Iwaki Prefect to develop pellet stoves. Boosted by the proposition, Sunpot moved its headquarters and main production facilities to Hanamki to better concentrate on the project.

Iwate Prefect helped with sales as well. As the newly developed stoves went into mass production in December 2003, the Prefect purchased seventy of them. It created an enormous buzz when the local government announced a plan to pay subsidies to the businesses, government agencies, and retail customers that buy the product. And there was another ingredient for their success: versatility. The pellet stove can run on all kinds of pallet fuel.

Another Ingredient for Success: Versatility

There are three types of pellets: white, mixed, and bark pellets. Each pellet has a different level of moisture content and combustion efficiency. Before Sunpot, various companies produced various pellet stoves that ran on only one type of pellet. When it comes to cost, bark pellets offer the most efficient solution. However, they produce more ash than others and often lead to incomplete combustion.Most of European pellet stoves, thus, use white pallets as fuel. To address this issue, Sunpot studied how and when to scrape out the ash and found the answer. Now, a little tweaking is all you need to change the fuel mode.

The Answer Lies in Lower Pellet Prices

Sunpot has been on a roll, increasing its market share based on its proprietary technology, but they are painfully aware of the inherent limitations they face down the road. Unless the household market is expanded, they will hit a dead end. Only cheaper pellets will drive up demand. Looks like that lower pellet prices will be the final ingredient in their recipe for continued success.