Q. With oil and natural-gas prices so high, I'm thinking about looking at alternative energy sources to heat my home. What do I need to know?
A. The good news is that nature has provided plenty of free energy to help you heat your house. The bad news is that it can cost a bundle to outfit a home with the systems needed to capture solar energy or heat stored in the ground, which is called geothermal energy.
The large initial investments have kept these types of systems from gaining more market share, experts say. But that could soon change.
"There really will be a tremendous mind-shift this winter when people open their bills and see that their prices have tripled or quadrupled from three years ago," said Jim Croce, the chief executive of NextEnergy, a Detroit-based nonprofit corporation that promotes alternative energy.
According to the Environmental Protection Agency, geothermal heat pumps are considered the most efficient, environmentally friendly and cost effective home-heating systems available.
Also known as GeoExchange systems, the heat pumps work by exploiting the differences in temperature between the air and the earth several feet below a house. Heat is captured by water flowing through a series of underground pipes and then brought into the house, where it is transferred to warm air that is sent through your ducts. In the summer, the system works as air conditioning with the heat from your home transferred into the ground or used to heat hot water.
Here's the catch: The systems can cost about $7,500, according to the Department of Energy, much more than the price of a traditional heating and air conditioning system. But according to the DOE, if you include the costs in your mortgage, you'll be saving money from the get-go because your energy consumption will be reduced by 25 to 75 percent.
Setting up a solar-heating system can also be expensive and require dozens of years to recoup an upfront investment. But many states have incentives in place; the Database of State Incentives for Renewable Energy, run by the North Carolina Solar Center and the Interstate Renewable Energy Council, lists federal, state and local programs.
There are also federal financing deals available for solar systems through Fannie Mae, Freddie Mac and a variety of federal agencies.
An increasingly popular way to avoid high heating bills is to install a "pellet stove," which burns compacted chunks of wood chips and sawdust and is vented through a hole in the wall, similar to the way clothes dryers are vented. These aren't cheap, either: Pellet stoves from Lennox Hearth Products, for example, go for about $2,700 to $3,200.
If you don't want to make a big investment, some consumers with oil furnaces are turning to "bioheat" - a blend of conventional heating oil mixed with soybean oil or other organic oils. A 5 percent soybean blend sells for about 10 cents cheaper per gallon than regular heating oil, shaving about 3 percent off the average fuel bill, according to Devine Brothers, a Connecticut fuel dealer. The company expects its bioheat sales this year to rise 500 percent from last year.
Other interesting alternatives are also gaining attention. In Wisconsin, cow manure provides the power for the equivalent of about 600 homes, according to the Dairyland Power Cooperative and Micrology, a subsidiary of Environmental Power Corp. Yeah, you read that right. The energy comes from methane gas, which manure produces as a byproduct.
Ultimately, your decision will have to be based on what incentives are available in your state, and what resources are best suited to your location. For example, it would make more sense to use solar power in Phoenix than in it would someplace that gets less sun. And it may not make sense to have quarts of firewood delivered to your home in the city.
"But if you're in the country, and you're talking about some combination of sweat equity and a cheap wood supply, you may very well find it now worth your time and effort to use more wood than you would have in the past," Croce said.
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