1. 5-Step Decision-Making Process - Home Heating

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1. The Five-Step Decision-Making Process
for Home Heating

In this chapter, each of the five steps in the decision- making process for home heating is described in detail.

Step 1. Before Starting

Consider getting expert advice from an EnerGuide for Houses evaluation. The service includes an evaluation of your home and provides recommendations or a written report and an energy efficiency rating for your home. It will help you plan the energy upgrades that can easily be incorporated very cost-efficiently into most renovation projects, resulting in a more comfortable home that uses less energy. For additional information or to get the name of the delivery agent in your area, call Natural Resources Canada toll-free at 1 800 387-2000.

Step 2. Draft Proofing and Insulating

It is counter-productive to invest in a new or improved heating system only to allow much of its heat to escape because of an inefficient house envelope that needs more insulation or has many air leaks. To avoid this, take a closer look at where you can draft proof and insulate simply and effectively before having your heating system sized, installed or upgraded.

Draft proofing and insulating have many advantages. Heating the house will cost considerably less, you will be more comfortable because there will be fewer drafts, and surfaces, such as walls, will be warmer. Your house will tend to be cooler in the summer too. Another benefit to draft proofing and insulating relates to humidity levels. Dry air in a house during the winter is caused by too much outside air getting in. Although the relative humidity may be high for cold outside air, the absolute amount of moisture (water vapour) this cold air can hold is actually very low.

When this air makes its way inside and is heated to house temperature, it becomes extremely dry.

If the air inside your house feels too dry, one of the easiest solutions is to add moisture using a humidifier. An even more effective way to increase humidity levels (and lower heating costs) is to reduce air leaks. In general, most houses that have been draft proofed and insulated do not need a humidifier – the moisture generated through cooking, bathing, dishwashing and other activities is more than adequate.

Making your house more airtight can cause excess humidity and affect its air quality. Unwanted fumes, odours, gases and excess humidity can be trapped inside the house envelope and may build up over time to unpleasant levels. One of the best ways to improve air quality while maintaining comfort and avoiding heat loss is to install a fresh air intake or mechanical ventilation system that brings in and circulates fresh air, without causing drafts. Your serviceperson should be able to provide you with more information.

Insulating, caulking and weatherstripping will reduce the amount of heat needed to keep your house comfortable. If your home has not been thoroughly reinsulated and draft proofed, you should consider doing this before changing or modifying the heating system. For more information about draft proofing and insulating, write for a free copy of Keeping the Heat In (see page 69). Whether you plan to do the work yourself or hire a contractor, this publication provides the information you need (including proper insulation levels) and can help make the whole job easier.

To ensure that you get a heating system with the right heating capacity, be sure to draft proof and insulate before you and your contractor determine what size of heating system and equipment is best. In general, oversized furnaces will waste fuel because they tend to operate in frequent, short cycles. They may also decrease comfort because of the resulting excessive temperature fluctuations.

If you are buying or building a new house, insist on the R-2000* Standard. R-2000 homes have high levels of insulation, airtight construction, heat recovery ventilators, energy-efficient windows and doors, efficient heating systems, and other design features that cut heating requirements by as much as 30 percent compared with conventional construction. For more information on R-2000 homes, see page 70 or contact your provincial/territorial R-2000 delivery agent. To get the name of the delivery agent in your area call Natural Resources Canada at 1 800 387-2000.

*R-2000 is an official mark of Natural Resources Canada.

Step 3. Selecting Your Energy Source

The next step is to select the heating energy source that is right for you. Generally, your options include natural gas, oil, propane, electricity or wood. You may also choose a combination of these conventional energy sources or alternatives, such as solar energy.

Your decision regarding the most appropriate energy source should be based on a number of considerations, the most important of which are energy availability, cost and the environment.


Not all energy sources are available in all areas of Canada. Electricity and heating oil are generally available in most places, but natural gas, which must be delivered by pipeline, is not available in much of the Atlantic region or in many rural and remote areas throughout Canada. Propane is available in most parts of Canada and may be used in rural or cottage areas as a substitute for natural gas or fuel oil, although often at a significantly higher operating cost. In many areas, wood is a cost-effective complement to your conventional heating system. Check with your local fuel supplier and gas or electrical utility to find out which energy sources are available in your area.


For most homeowners, the major factor in the home heating decision is cost. This factor will have two major components – the capital cost of the installed heating system and the annual operating cost for energy. Other factors, such as maintenance costs, cleanliness and noise of operation, should also be considered.

Installation capital costs of various heating systems, depending on whether they are new or retrofitted, include such items as the following:

  • hookup to gas lines or electric power lines
  • 200-amp service for electric heating
  • storage tanks for oil or propane
  • heating equipment (furnace, boiler, baseboard heaters, heat pump, etc.)
  • chimney or venting system (if required)
  • ducting system or pipes and radiators
  • thermostats and controls
  • trenching or drilling for earth-energy systems (ground-source heat pumps)
  • labour for installation of any of the above

The capital cost of a heating system can range from as low as $1,000 for baseboard heaters in a small house to as high as $12,000 or more for a ground-source heat pump for a larger home (capable of providing heating, air conditioning and hot water). Heating contractors or utility representatives can give you an estimate of the capital cost of various systems. Always ask for a firm, detailed quotation before you authorize any work.

The operating or fuel cost of a heating system is determined by three major factors:

  1. Annual heating load or heating requirements of the house. This depends on the climate, the size and style of house, the insulation levels, the air-tightness, the amount of useful solar energy through windows, the amount of heat given off by lights and appliances, the thermostat setting and other operational factors. Together, these factors determine how much heat must be supplied by the heating system over the annual heating season. This number, usually expressed as MJ, kWh or Btu per year (see "Gas Heating Terms," page 4), can be estimated by a heating contractor, home builder or utility representative.
  2. Choice of energy source and its unit price. Each energy source is measured and priced differently. Natural gas is priced in cents per cubic metre (¢/m3), dollars per megajoule ($/MJ) or dollars per gigajoule ($/GJ); oil and propane in cents per litre (¢/L); electricity in cents per kilowatt hour (¢/kWh); and wood in dollars per cord. You must consider the heat content of the various energy sources to determine the most cost-effective energy source for your area. Check with your local utility or fuel supplier for the price of the energy sources in your area. Table 2 on page 50 gives the energy content for the various energy sources in the units in which they are commonly sold.
  3. Equipment efficiency. The seasonal efficiency with which the appliance converts the energy source to useful heat in the home is also an important factor in the heating cost equation. For example, if a furnace has an AFUE (see "Heating Concepts," page 3) of 80 percent, then
    80 percent of the heat value in the fuel is available. The other 20 percent is lost, mostly up the chimney; thus, additional fuel must be consumed to make up for these losses. Improving the efficiency of the heating equipment reduces energy use and cost.

The combination of heating load, fuel choice and equipment efficiency determines the annual cost of heating. A detailed description of how you can calculate heating costs for various energy sources and technologies is given in Chapter 5, along with typical seasonal efficiencies (or AFUEs) for a range of technologies.

When choosing a new heating system, it is important to buy a product that offers the best possible quality/price ratio within the limits of your budget. Take into account the overall cost of each system you are considering; this includes its purchase price, installation cost and operating costs. Often the optimal choice is the most efficient product. A higher initial purchase price is usually more than compensated by lower operating costs and, in some cases, a lower installation cost. The more efficient system saves you money every time you heat your home, and these savings increase as fuel prices increase over the life of the heating system.


The effects of energy production and consumption play an important role in many of today's key environmental problems. Exploration for and extraction of fossil fuels in fragile ecosystems, spills and leaks during transportation, urban smog, acid rain and climate change can all adversely affect our environment. Each form of energy has a different impact at various points in the energy cycle. No form of energy is completely harmless, although the environmental impacts of some sources, such as passive solar energy, are relatively insignificant.

Heating your home affects the environment in different ways, from gases leaving the chimney, to emissions at a coal-fired electricity-generating station, to flooding at a remote hydroelectric site. The overall environmental impact is determined by the amount and type of fuel your heating system uses. Selecting the cleanest energy source available is within your power.

The combustion of natural gas, propane or fuel oil in your furnace releases various pollutants into the local environment. Electricity is clean at the point of use, but it has environmental impacts at the point of generation. In Alberta, Saskatchewan, Ontario, New Brunswick, Newfoundland and Labrador, Nova Scotia and Prince Edward Island, coal or heavy oil is burned to meet electricity demand during the winter. In British Columbia, Manitoba and Quebec, where winter peak demand is met by hydroelectric power, the environmental impact is much less obvious. However, in some instances, emissions of methane, a greenhouse gas, can be high in hydro dam
projects. Nuclear power has its own set of environmental problems.

In short, there is no easy solution; but by buying the most efficient system with the most appropriate energy source for your area, you can make a major contribution to helping the environment. Other approaches to reduce energy use and the impact on the environment include improving your home's insulation and air-tightness (while ensuring proper ventilation), maintaining your heating system, installing set-back or programmable thermostats and improving your heat distribution system.

Step 4. Selecting or Improving Your Heat Distribution System

Most heating systems today are either forced-air systems or hydronic (hot water) systems. These consist of a heating unit (furnace or boiler), a distribution system (ducts and registers or pipes and radiators) and controls (such as thermostats) that regulate the system. Some houses use space heaters and may not have distribution networks.


By far, the most common type of central heating system used in Canadian homes is forced air (with a furnace as the heat source). Among its advantages are its ability to provide heat quickly, to filter and humidify household air, and to provide ventilation and central air conditioning. In addition, with an efficient circulating fan motor set, the furnace fan can be used year-round to provide continuous air circulation throughout the house while efficiently balancing the distribution of heat in colder months. It also allows for overnight thermostat set-back, a simple way to save energy.

Forced-air heating systems also have some disadvantages. The temperature of the air coming from the heating registers can vary depending on the type of system. The air can sometimes feel cool (especially with certain heat pumps), even when it is actually warmer than the room temperature. The effect is much the same as the cooling action of a fan or a summer breeze. In addition, there can be short bursts of very hot air, especially with severely oversized systems. Some people may find such characteristics uncomfortable at times. The ductwork that distributes the heat may also transmit the noise of the furnace and circulating fan to every room and can circulate dust, cooking odours and other airborne odours throughout the house. Consult your heating contractor for further information.


A hydronic heating system uses a boiler to heat water. The hot water is circulated through the house before returning to the boiler to be reheated.

Gas-fired boilers for conventional hydronic heating systems typically produce hot water at approximately 82°C (180°F) and are part of a closed system.

At one time, hot-water or steam-heating systems had large boilers and used wrought-iron pipes and massive cast-iron radiators; some of these still exist in older homes. For many years now, installers have been using smaller copper piping, slim baseboard heaters, and smaller, more efficient boilers. Recently, CSA-approved plastic piping has become available as an alternative to copper piping for space heating and service hot-water distribution.


Apart from the more popular systems previously noted, others that can be used independently or in combination with the standard system are also available. These include room space heaters, radiant space heaters and built-in radiant systems.

Room space heaters provide heat directly to the rooms in which they are located and do not have a central heat distribution system. Obvious examples are wood stoves, vented oil-fired space heaters, and electric or gas-fired baseboard heaters.

Some space heaters can also be effective radiant heat sources, warming solid bodies (such as people) in their line of sight without necessarily having to heat up all the air. Good examples are the new direct-vent gas fireplaces, advanced combustion wood fireplaces and stoves, and portable electric infrared radiant heaters. If properly located in a major living space, a radiant space heater can act as an effective surrogate zoning system, lowering the overall heat demands of the house and the final heating bills while making the occupants feel more comfortable.

Built-in radiant systems are generally of two types: hot water pipes in floors and electrical cables in floors, which may also be installed in ceilings. The radiant floor type, becoming increasingly popular, consists of narrow hot water pipes embedded in the floor or laid in the joist space under the floor. Hot water at a temperature of around 40°C (104°F) is pumped slowly through the pipes and radiates heat into the house. Thick carpets can reduce effectiveness significantly by acting as insulation. Such a system may be more costly to install and does not appear to offer much in direct energy savings. However, some radiant floor installations offer benefits in terms of comfort, and result in lower thermostat settings and reduced heating bills.

Your choice of a heat distribution system may be limited if you have a warm air or hydronic system already in place. If you have electric baseboards and are faced with high heating bills, you may want to change to another type of system, even though it can be an expensive undertaking. Although a major constraint is the lack of a distribution system, many homeowners are finding that air ducts for a central forced-air system or pipes and radiators for a hydronic system can be installed at a cost that still makes the whole conversion financially attractive. Fuel-fired space heaters, wood stoves and advanced, energy-efficient wood- or gas-fired fireplaces can also be effective.

Your final choice will probably be based on the answers to one or more of the following questions:

  • How much will the system cost compared with other systems?
  • Will this type of system suit my lifestyle? Will I be comfortable with it? Do I want central ventilation, air conditioning or air circulation?
  • Is there a contractor available to install the system?
  • Is the system compatible with my energy choice?

Step 5. Selecting Your Heating Equipment

After you have selected your energy source options and your heat distribution system, you can begin to consider your alternatives regarding heating equipment and efficiency levels. At some point in your evaluation, you will have to consider whether to upgrade your existing heating equipment or to replace it entirely. A number of things can be done to improve the efficiency and general performance of an existing heating system. You also have the choice of several different replacement models with various efficiency ratings and prices.

Following are some details to consider when choosing your equipment.


Refer to Chapters 2 and 3 of this booklet for a more detailed discussion of your options for gas furnaces and boilers.


Generally, the more efficient heating systems have a higher purchase price, but most often the initial incremental cost is quickly paid back by fuel savings, making energy efficiency a good investment.

Often, the more efficient systems require much less house air and may not even need a chimney. High-efficiency units can be vented out a side wall. This makes them safer and more compatible with airtight housing. Having high-efficiency heating equipment can be a buying incentive and can increase the resale value of your home.


It is important to know the type and frequency of servicing your system requires, the price of parts, the cost of servicing, and the details of guarantees and warranties, such as the period covered and if parts and labour are included. All gas furnaces require general maintenance to ensure optimal performance.


The Government of Canada has implemented energy efficiency standards for some heating equipment and other energy-consuming appliances and products. In addition, various provincial/territorial governments have introduced energy efficiency standards. Generally, these standards establish the minimum acceptable energy efficiency level for specific types of heating equipment. After the standards are in place, models that do not comply with the standard are no longer allowed on the market where the standard applies.


Since 1995 the national minimum efficiency standard for gas furnaces has been 78 percent. Prior to that, the 78 percent efficiency level was considered to be a mid-efficiency level by the industry, and since there remain many pre-1995 low-efficiency furnaces in Canadian houses, the term mid-efficiency continues to be used by some to denote the 78–84 percent efficiency range. When considering new furnaces, it is important to remember that the 78 percent level is now the least efficient furnace available on the market, and this booklet will refer to those furnaces as standard-efficiency furnaces.


The Government of Canada and the Heating, Refrigeration and Air Conditioning Institute of Canada (HRAI) have established a voluntary energy efficiency rating system for residential gas and propane forced-air furnaces to help consumers compare the energy efficiency of different products. The EnerGuide label with the furnace's AFUE rating (Figure 1) is shown on the back page of manufacturers' brochures. Included on the EnerGuide label is a rating scale showing the range of efficiencies for gas and propane furnaces on the market, as well as a pointer indicating where the model is positioned compared with others in terms of efficiency. Chapter 5 shows you how to determine heating costs based on the furnace's AFUE rating.

Figure 1 An EnerGuide label for gas and propane furnaces

An EnerGuide label for gas and propane furnaces

Energy Star logo

ENERGY STAR® Qualified
Gas Furnaces and Boilers

The international ENERGY STAR symbol is a simple way for you to identify at a glance product models that are among the most energy efficient on the market. Natural Resources Canada promotes and administers the ENERGY STAR symbol in Canada. Only gas furnaces and boilers that meet the higher energy efficiency performance levels of ENERGY STAR may carry the symbol.

For a gas furnace to meet ENERGY STAR criteria, it must be a condensing unit with an AFUE of 90 percent or higher. See Chapter 3 for information on condensing furnaces.

For a gas-fired boiler, the ENERGY STAR criteria is set at an AFUE of 85 percent. ENERGY STAR qualified boilers are not necessarily condensing models. See Chapter 3 for a discussion of suitable applications for condensing boilers.

Replacing a 20-year-old furnace that has an AFUE of 60 to 65 percent can mean an annual energy savings of at least 30 percent. You are invited to use the EnerGuide Heating Cost Calculator, available on the EnerGuide Web Site at oee.nrcan.gc.ca/equipment.

Given that 60 percent of the energy required to run the average home is used for space heating, buying ENERGY STAR qualified products will not only save you money but help the environment. By improving the energy efficiency of your space heating, you reduce greenhouse gas emissions that contribute to climate change and significantly help in achieving Canada's climate change goals.

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Source: Natural Resources Canada (NRCan) - Office of Energy Efficiency