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Pellet Stoves Vs Wood Stoves Pellet stoves burn wood pellets, corn or a blend of both to generate heat. An auger powered by motors loads the pellets into a combustion chamber, where they are ignited and heated. Most models come with thermostatic controls to maintain the fire at the desired temperature. They produce very little ash and release very little air particles. Cost In comparison to wood stoves, pellet stoves tend to cost less. This is due to the lower installation costs