Pellet stoves, the wood stove's distant cousin, are catching on as a new mode to heat homes without the financial headache. Pellets made from compacted sawdust or wood chips replace conventional fossil fuels. Instead of worrying about the cost of oil deliveries, pellet stove owners can arrange for trucks to deliver pellets. These pellets can be burned to heat water, in turn heating the house.

Despite recent price increases for wood and wood pellets resulting from crude oil speculation, they're still 50 percent less expensive than propane and electricity, and 35 percent cheaper than heating oil.