Here is some quick numbers.....
Natural gas has 35,500 BTU per cubic meter (Canucks) and 1,020 BTU per cubic foot.
I do not know what gas prices are like in the US, but here in Ontario, it's 13 cents a m3 but by the time you add up all the sub charges and taxes, it's about 33 cents a m3.
Soo....taking Ontario figures......in the most basic calculation, assuming 8,900 BTU/pound pellets, then the pellets have to be 1/4 of the price of natural gas to beak even, or about $165 per ton NET (including delivery and taxes).
If you want to break it down further and more accurately.....
you take the gas price and DIVIDE it by the efficiency of the gas appliance (in my case $.33 times .90 (90%) and I get $.366).
you take the of the pellet cost and DIVIDE it by the pellet stove efficiency (if it's $200 ton and the output efficiency is 80% then it's $250 per ton).
So now let's see how it compares in my situation.....
The effective price of ngas per m3 after my furnace has converted it to actual output is $.366. Divide that by 4 to reach equivalent BTU in pellets and it's $183.33 per ton. To compare it to pellets heaters net BTU output, I must MULTIPLY it by the pellet heaters efficiency of 80% to come to the actual BTU output cost. Now I have to buy pellets at $146.66 per ton to break even with gas. Pellets above that price, it's not worth it, below that price, it's worth it. Then there is the big elephant in the room.....labor.
What you really want is to focus in is how many BTU"s you are getting for your buck.
Couple of notes, gas is VERY CHEAP right now up here because of the recession. It was a 50% higher before and if the gas companies have anything to do with it, it will be up there again.
(I'm doing this on the fly, if I have made any mistake, by all means let me know.)