How to heat your home without hiking your power bill

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Years ago we bought a house with underfloor heating.

The first winter we wore T-shirts and went barefoot until our first power bill arrived. We put on ugg-boots, turned down the thermostat and switched the power to off peak.

We were smarter with the next house, choosing gas heaters and the occasional fire in the small fireplace.

With power bills rising, it is essential to be efficient with home heating.

Not enough homes are built to be energy efficient, so it's important to choose the cleanest fuel to heat the house.

Gas heaters and reverse cycle heat pumps produce only one third the amount of greenhouse gas emissions of standard electric heaters, according to the government's housing information website.

Radiant heaters or radiators are inefficient and can be hazardous if anything is left too close.

Choose the right size heater. Look at the energy labels on gas heaters and reverse cycle heat pumps. The more stars, the more efficient the appliance.

Unflued gas heaters can spread carbon monoxide, nitrogen dioxide and water vapour into the room so you need ventilation such as an open window.

Small oil-filled portable heaters are good for heating up rooms such as bedrooms. It is best to buy one with a thermostat and a timer to allow you to heat up the room before you come home.

Only heat the room you are using, not the whole house. Learn to close doors to keep heat in.

Don't leave heaters on overnight or during the day when you're not at home. Avoid heating the room to tropical temperatures. Wear your favourite jumper and warmest socks and turn your heater down.

Try 18C to 20C rather than 23C. Each degree less will save about 5% to 10% on your energy use.

I love the ambient glow of a fire but unless you sit close by it doesn't keep you warm. Around 90% of the heat is lost up the chimney. Wood-fired heaters account for around 20% of heating in Australia.

Wood is a great renewable energy source if it is sustainably harvested and burnt in high efficiency, low emission heaters. But it is often obtained from unsustainable sources. And there is air pollution from wood fires from fireplaces if much of the smoke escapes.

Insulation in your ceiling helps keep the heat in. Unfortunately there are no longer rebates for ceiling insulation. An average household loses 35% of their heat through the ceiling, raising power bills.

There's no better time to plug the drafts in your house. It's easy to do. How do you find them? Light a stick of incense or a candle on a windy day and see where the incense smoke drifts.

Plug any cracks in the walls, architraves, skirting boards, floors, windows and doors - anywhere there are joins. Check vents, skylights and fans. At small cost silicon can plug the gaps; door snakes or door sweep strips attached to the bottom of your door can help too.

Warm air escapes through glass, so cover windows at night or install energy-efficient ones. Most windows have single glass with an R-value (thermal resistance rating) of only 0.17.

Better windows keep heat in during winter and keep it out in summer. See the Australian Window Association's website for more information.

Heat rises so if you have a ceiling fan, turn it on to spread the heat and circulate it more evenly. A slowly circulating fan can take up to 10% off your bill.

The cheapest central heating system?

The most efficient central heating system in terms of low running costs and very low greenhouse gas emissions is the hydronic zoned system that uses hot water through radiator panels in rooms, providing a mix of convective and radiant heat.

They are usually gas fired but can use a wood-fired heater or solar systems.

The next most efficient central heating systems with low running costs and greenhouse gas emissions are high efficiency ducted natural gas central heating where the hot air is circulated through roof or under-floor ducts.

In comparison, a ducted reverse cycle heat pump has a medium running cost and medium greenhouse gas emission.

It is more efficient than the in-slab high off-peak electric heating that is set underneath tiled or stone floors.

In-slab central heating has medium running costs but very high greenhouse gas emissions.

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"At the beginning I was pretty suspicious. I was like, what's the catch here? But I've been using them for a few years now, and I have been able to save quite a lot of money," says Queenie Tan.

Susan has been a finance journalist for more than 30 years, beginning at the Australian Financial Review before moving to the Sydney Morning Herald. She edited a superannuation magazine, Superfunds, for the Association of Superannuation Funds of Australia, and writes regularly on superannuation and managed funds. She's also author of the best-selling book Women and Money.