Types of Energy-Efficient Home Heating

By Beth Krietsch

Comprising up to 50% of your home energy bill, heating can take a hefty toll on the environment and your wallet if you’re not mindful of conservation. Follow this energy-efficient home heating guide to choose the best heating system for your home while keeping the environment and cost in mind. Each option has unique advantages based on location, cost, ease of installation, and more.

Solar ($–$$$$)

You’ll find two distinct types of solar heating—active and passive. Though both harness the sun’s energy to warm your home, they capture this energy in different ways.

Active solar ($$$–$$$$)

Active solar technologies absorb the sun’s energy through flat-plate panels that typically sit stationary on the roof of a home but are sometimes capable of moving to track the path of the sun.

Once installed, there’s no further energy cost as long as the solar panels are able to collect and store enough energy to fully heat your home. Many are drawn to solar options because they reduce reliance on power companies, but the initial cost—which can be at least $15,000—proves prohibitive for some.

Look into tax credits to see where you can save, and keep in mind that once the system is set up, there’s no additional cost—the energy really is free.

Solar Active solar panels collect energy from sunlight to provide electricity and power your home

Passive solar ($–$$)

Passive solar energy depends on a home’s structural ability to efficiently capture the sun’s energy—think south-facing windows and effective insulation—but the design of the energy-efficient elements will ultimately be determined by the local climate and the home’s position. Cost-effective and environmentally friendly, passive solar heating can reduce your energy bill by 50% or more.

Passive solar energy collection can be used for water heaters as well, where a solar panel is connected to a water tank, using the sun’s energy to heat the water.

Combination ($–$$$)

Some homes are designed to passively collect solar energy but also incorporate solar panels for added energy storage and savings.

Solar Passive solar energy means positioning windows, awnings, and structural elements to capture or deflect the sun's heat

Wood ($$)

A modern and efficient wood-burning fireplace is capable of producing enough heat to warm an entire average-sized home. Heating your home with wood can be an energy- and cost-effective way to keep your home warm and toasty given the following:

  • You live in a highly wooded area where you can cut your own wood or you have access to cheap firewood. If you’re not chopping the wood yourself, you’ll want to ensure that it was collected sustainably.
  • Your home is equipped with an energy-efficient stove that burns cleanly. Fireplaces that don’t burn cleanly emit large amounts of unhealthy air pollutants through their smoke.

Some homeowners upgrade older fireplaces with modern, high-efficiency fireplace inserts that improve heating efficiency but still use the same chimney. These can be as efficient as a wood stove, the US Department of Energy says.

To ensure the most value and efficiency, you’ll want to avoid wood with high moisture levels or store your wood in a place with minimal moisture. Oregon State University reports that for every 1% increase in moisture content, you’ll see a 1% decrease in heating value, as energy is needed to evaporate the moisture.

Wood Wood-burning fireplaces offer energy-efficient home heating provided the wood is collected and stored responsibly

Heat pump ($$–$$$)

Heat pumps are capable of producing nearly triple the amount of heat compared with the energy they use, making them extremely efficient compared to other methods of electric heating, such as baseboards or furnaces, the Department of Energy explains. They recommend heat pumps as an energy-efficient heating method for those who live in areas with moderate climates and heat their homes with electricity.

Most traditional heat pumps (unlike geothermal heat pumps, discussed below) collect energy from air or water before transferring it into your home.

Heat pumps Heat pumps feature an outdoor component, the coil evaporator (right), which collects thermal energy from outside to be used inside

Geothermal ($$$$)

Geothermal heating systems warm your home with energy extracted from the ground. Heat is transferred through water-filled pipes that span a connection between the home and the ground.

Geothermal systems can work anywhere, and because the energy is derived from the ground, the source is consistent and sustainable. This means you won’t need to rely on the strength of the sun or wind as you would with some other environmentally friendly heating sources. Maintenance is minimal, too. You can expect to do some filter changes and annual coil cleaning, but beyond that you won’t be burdened with expensive or time-consuming upkeep if the system has been installed properly.

ENERGY STAR ranks geothermal as one of the most efficient heating technologies out there, and the US Department of Energy says that, in general, heat pumps can lower heat-related energy use in the home by nearly 50% compared to electric systems.

What about cost? Installing a geothermal pump system in your home can be expensive—possibly $20,000 or more, depending on lot size—but the payback can be quick, and federal and local tax credits are available as long as the system meets ENERGY STAR requirements.

Geothermal Geothermal heating is a clean, renewable, and sustainable form of home heating. Pictured above are coils laid underground that collect thermal energy from the ground to be carried inside the home.

Choosing the right energy-efficient heating system for your home

You’ll want to first consider the overall cost of getting a new system up and running (don’t forget to consider tax credits), against potential savings over time. From there, you can determine what’s affordable to you. You’ll also want to think about the type of heat your home currently uses (some conversions are easier than others) and the climate where you live.  

If you’re not ready to get a whole new heating system in place, you can still take some simple steps to make your home more energy efficient, like sealing leaks in walls and windows, cleaning radiators and baseboard heaters, upgrading to a smart thermostat system, or having your furnace inspected to ensure it’s running properly.

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