A recent $400 electric bill made me wonder what the most efficient way would be to heat a 1,800 square foot home. The journey brought me down a DuckDuckGo hole where I ended up learning about pellet stoves, Biomass Stove Tax Credits, HHV, full-home propane and heat pump limitations.
In my situation, have an electric heat pump in a 1,800 square feet log home. There is no natural gas available in the area and the old wood burning fireplace insert had to be removed due to safety issues. The original electrical panel is almost maxed out so the ability to run space heaters or installing panel ovens in each room is limited.
While heat pumps are wonderfully useful and efficient if the exterior is in the 40F to 80F range, the efficiency usually goes way down outside of that range. When the temperature drops below 40F, a heat pump use electric heat strips called emergency heat to heat the home. This past winter, in the log cabin with the thermostat set at a constant 64F, the emergency heat ran nonstop and resulted in the before mentioned $400 electric bill.
Most modern homes are heated by gas furnaces or heat pumps. In addition, supplemental heating is usually available with fireplaces, fireplace inserts, stoves, panel ovens and space heaters. In Northern Virginia, most new homes will have a heat pump and a gas furnace where available and gas or wood fireplaces are provided more for atmosphere.

From US Energy Information Administration
So, what are the components and options to heat your home? Here is some information you may find useful.
Forced Air Furnaces
A furnace heats the air in your home by heating the air by burning of a fuel, usually natural gas, propane, oil or electricity. A blower motor then pushes that hot air through ductwork which delivers the heated air to various rooms in your home. The blower motor also creates suction to pull in air from parts of the home to send to the furnace for heating. The design of the system and ducting will impact how even and how well your home is heated.
Furnaces can be Single Stage or Multi Stage. Single Stage has two settings for heat – on or off. When on, it will use 100% of the available power. Multi Stage furnaces are more efficient, having multiple settings depending on how much heat is needed. If there is a large need for heat, it will open up allowing the use of 100% power supply. On milder days, it will throttle back the use and save you energy (money.)
Gas furnaces are usually very efficient. A high efficiency gas furnaces can run at 95% efficiency.
A programmable thermostat can result in further savings as it will turn the heat down during the day when you are away from home or at night when you are asleep. The heat exchanger does not need to run as much to heat as much air as would be needed if you were home and needed the home warmer.
Electric Heat Pumps
A heat pump recirculates heat from outside the home to inside and vice versa. It does not generate heat from scratch. How does this work in the winter when it is cold outside? How is your heat pump supposed to make the air inside the home warm?
Perhaps you might remember high school physics? Pressure is directly proportional to temperature? Gay-Lussac’s law? If you pressurize a gas into a container, it heats up. Think of pumping air into tires, pumping air into them gets the tires warm. Conversely, if you spray whipped cream out from the canister onto your waffles, the can gets cold.
Same deal with the refrigerant in your heat pump system. When in heating mode, the refrigerant is forced to expand by reducing the pressure on it, this causes the temperature of the refrigerant to drop. This creates a heat differential between the outside air and the coils of the heat pump. Heat flows from hot to cold, heating up the air which is then piped into your home.
What if the air outside is very cold, so cold that it is almost the same temperature as the expanded refrigerant? This is when the auxiliary heat comes in. Heat pumps have electric strips that will generate heat when there is not enough differential in temperature to heat your home.
Heat pumps can run at a supposed 300% efficiency. However, if the auxiliary heat is required, the electric heat strips require a lot of electricity to run and will burn through any savings. Heat pumps do not work well around and below 30-35F. At those temperatures and below you could end up paying quite a bit for a relatively cool and slightly uncomfortable home.
Would a programmable thermostat help with a heat pump? Your heat pump works most efficiently if the refrigerant is set at the same temperature. Changing the temperature of the refrigerant is what consumes energy. If your programmable thermostat is busy flipping the temperature up and down repeatedly, your heat pump struggles to keep up, using a lot of energy and thereby increasing your utility cost. So contrary to what you think, using a programmable thermostat can actually cost you more money if you have a heat pump.
Supplemental Heat Options
As a heat pump could be inefficient during the coldest parts of the year in our area, a commonsense option would be to provide supplemental heat to your home by installing either a fireplace or a stove. Wood fireplaces are usually inefficient where you risk losing ~50% of heat to the chimney. A wood or pellet stove could give you up to a 90% efficiency. You will also need to use seasoned wood to prevent creosote build up in the chimney and reduce the danger of a chimney fire.
Fuel Types
Propane is an efficient fuel to burn. However, you will need a tank onsite to store it. Tanks have to be in areas that are located a certain distance from windows, doors, cannot be close to an enclosed area like a shed, or close to a crawl space vent. There are limitations on the size of the tank allowed. If using propane to heat your home as well as cook etc, you might need more than 1 tank. Depending on the size of your lot, you might or might not be able to accommodate the tank or tanks. Even if you have the space, it could be an eyesore. Often times, homes have very few locations that fit the requirement for tanks. Also, you need to make sure that the tank does not leak. Clean up will be costly. Propane price fluctuate and have gone up a lot recently. They are only expected to go higher.
Natural gas burns clean and is the most price effective of fuels. It is piped to homes so no tanks are needed.
Wood could be the cheapest option if you have a backyard full of trees. Wood stoves need seasoned wood that needs to be stored. If you need to purchase wood, it can get expensive and cumbersome to move very quickly.
Oil furnaces are supposedly cheaper to install. Oil does not explode, however, leaks are expensive to clean up. The cost of oil varies, and like propane, it is on the rise.
Solar Electric have an advantage of running on self generated solar electricity and could end up with the lowest operating cost if solar is available to the home owner. The install and equipment costs are still high but tax credits and incentives are still available most places. If you wish to use solar when the sun is not out, you will need battery packs installed which are expensive. Without solar, electricity is expensive when used to run heat pumps to heat homes.
Pellets are a cheap and renewable source of fuel. Initial purchase and install costs for a pellet stove or furnace could be expensive. However, a pellet stove can output a lot of heat, can run for days and if the pellets are purchased in bulk, could be the cheapest option to heat your home if no gas is available. The downside is that you will need a place to store your pellets.
So, what did I end up with for my log-home? A high efficiency programmable pellet stove from Ravelli that will provide supplemental heat for the home in the winter months. Propane would be easier maintenance-wise, but the fuel cost and aesthetics of the tanks wouldn’t work.