Farmers from across Atlantic Canada gathered in Truro, N.S., on Tuesday to learn about converting grass into fuel.

The technology is based on converting marginal grassland and unwanted hay into pellets that can be burned in wood or pellet stoves or furnaces.

Gus Swanson, a Pictou County farmer and inventor, created a furnace to burn hay pellets.

He said he came up with the idea several years ago when the price of oil went up.

"I had a farm with 400 acres of hay on it. We knew we could burn it if it's made into pellets so I thought I had it made back then but oil dropped down over the years," Swanson said, laughing.

"It's cheaper and it's on the farm in your own backyard. For farmers it would be ideal. My interest in it is, get the farmers' fields back into production and get jobs for the rural areas."

Swanson now heats a three-bedroom apartment, a two-bedroom apartment and a two-bedroom house with hay pellets for about $300 a month. He was previously spending $900 a month when he used oil to heat the properties.

Swanson is working on the project with a furnace maker in Pictou, a company that makes pellet machines in Cape Breton and government scientists at the Nova Scotia Agricultural College.

Kenny Corscadden, one of the scientists at the Nova Scotia Agricultural College, said while the province doesn't have the best land for food growth, grass has the potential to make money.

"It certainly grows in abundance. We have a lot of marginal lands in Nova Scotia and there's great potential for grass to be grown here. It's a crop that grows every year," said Corscadden.

Gus Swanson, a Pictou County farmer and inventor, created a furnace to burn hay pellets. CBC"One good application is to use hay that isn't suitable for a food stock and turn it into an energy crop."

Corscadden estimates it will take about 8,100 square metres of grass to heat a home for a year.

"One of the key benefits would either be to keep land from going into disuse or to bring it back into use," he said.

"That's another nice benefit of grass, it doesn't have to compete with a food crop. We don't use grass for any other source, really, in the food chain so it won't compete with that land that's been used for food production."

Scientists estimate up to 100,000 homes could be heated with locally-grown grass if farmers show enough interest in using their fields to produce biomass fuels.

"Farmers need a market for their crops so they're not going to start growing crops until there's an outlet for that so it's getting everyone together at the same time … to try and get everyone talking and on the same page," said Corscadden.