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Q: I recently purchased a 1,146-square-foot home with a seven-year-old gas furnace rated at 80 percent efficiency. The rise in gas heating costs has me wondering if I should upgrade the furnace, or maybe even convert to a different type of fuel. Can you help me decide?

Susan Cairns, Hilliard, Ohio

A: To make your decision, you need to weigh three factors: your furnace efficiency, the cost of fuel, and the "heating load" of your house—that's the amount of energy required to maintain a steady 65-degree temperature indoors.

Fuel costs are a real wild card these days, thanks in part to Hurricane Katrina. Generally, though, gas is competitively priced, so I don't think it makes much sense to switch to oil or electricity. Also, your furnace is already pretty efficient, though not as good as the best condensing-type gas furnaces, which capture up to 97 percent of the fuel's energy. If your furnace were old and worn out, your decision would be easy—buy a more efficient model—but the average life of a well-maintained furnace is 25 years, so yours still has plenty of life in it.

If you did replace your furnace with a 97 percent efficient system, you'd cut your heating bills around 20 percent. To see if it's worth spending the money, add up the fuel bills for last winter—your gas utility will have records—then multiply that sum by 20 percent. Divide that figure into the cost of buying and installing the new system, about $3,000 or so, and you'll see how many years it will take to recoup your investment.

Given the size of your house, I doubt you'll see a payoff anytime soon, even if you add 50 percent to last year's bills to account for this winter's projected increase in natural gas costs. Of course, every dollar that gas prices go up will shorten the payback time, but prices could also fall and lengthen the payback.

If it were my house, I'd first look for ways to reduce the heating load. Ask your utility company to perform an energy audit. That will probably uncover some relatively inexpensive upgrades, such as new weatherstripping or added insulation. Also, ask the company that maintains your furnace about ways to improve its performance. For instance, you might be able to replace a standard pilot light with electronic ignition or seal the joints in your ductwork. These minor improvements will help reduce heating costs and make you more comfortable without draining your bank account.

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