Heating with wood (Home Energy Part 18)
For those living in rural woody areas, heating with wood can be a great option. Fire places are typically what most people think, when thinking about heating with wood. Fire places are actually the worst way to heat a home. The majority of the heat is lost up the stack. They are only 10-20% efficient. An insert can be installed in an existing fireplace boosting the efficiency to 70%. A fan can also be installed on an insert to improve circulation and heat adjoining rooms more evenly. 
There are three types of wood stoves. Radiant wood stoves are very similar to an insert except they are stand alone, and would need a flue pipe. Like an insert, they are rated at 70-80% efficiencies. Circulating wood stoves are double walled and can be equipped with a fan. They are also rated in the 70-80% efficiency range. Finally the traditional combustion wood stove, which is very similar to the radiant stove except the door can be opened when the fire is burning like a traditional fireplace. This does bring the efficiency down to 50-60%. 
Wood stoves are great for one or two rooms, but if you would like to heat a large modern home with wood, a wood furnace makes a great option. Wood furnaces are typically installed in basements, garages, or even outside. Wood furnaces can be used in conjunction with conventional home heating systems such as: radiant floor heat, baseboard, or forced air systems. Some wood furnaces are designed to also preheat the domestic hot water. During the winter these furnaces not only heat the home, they also provide water heat, greatly reducing natural gas or electricity consumption. 
Wood furnaces are pretty efficient, clean burning, and easy to operate. Also with an outdoor unit, you can have your woodpile nearby to avoid excessive hauling of wood. On the downside they are costlier than a wood stove, and are more difficult to install. Also, wood needs to be constantly reloaded and the ashes periodically cleaned. 
If cutting and hauling firewood isn’t your cup of tea, then a pellet stove might be a good compromise. Instead of firewood, the fuel is dry compressed wood pellets that are made from sawdust, a waste product of the timber industry. Pellets are packaged in 40 pound bags and sold in most hardware stores. Because pellets are dry, and because they are fed into the combustion chamber at a controlled rate with plenty of air, these stoves burn very cleanly and efficiently. On the downside you will spend more money in pellets than you would with firewood, and pellet stoves require electrical energy to operate the auger and the blower fans. 
I have a small pellet stove at my home as a source of backup heat. I would have preferred a circulating wood stove, but the cost was out of my budget, and it is easier for me to store wood pellets, than a wood pile.
3. Chiras, Dan., “The Homeowners Guide to Renewable Energy,” March 2006.