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Pellet Stoves Vs Wood Stoves Pellet stoves produce heat by burning wood pellets, corn or a combination of both. A motor-driven auger loads the pellets into a combustion chamber, which is where they are igniting and heated. The majority of models have thermostatic controls to keep the fire at the temperature you set. They produce very little ash and release very little air particles. Cost Pellet stoves are cheaper than wood stoves. This is due to the fact that they are cheaper to install and can be vented by tiny holes in the wall. Pellet stove