These simple steps will reduce your energy bills by up to 50 percent. First some good news ... According to some energy experts, homeowners probably won't have to shoulder another big increase in their fuel bills this winter. The bad news? Fuel prices aren't expected to drop, either. We are faced with two options: We can continue to pay sky-high energy bills, or do something about it. Now, the really good news: Follow the steps we've outlined here and you can easily reduce your energy bills by up to 50 percent. Most of these techniques are inexpensive, and many can be completed in a weekend. Others may only require that you change a habit or two. To learn how you can get the larger projects to pay for themselves, check out "Getting Paid to Save," Getting Paid to Save If you're thinking of refinancing your home for remodeling, or you want to buy a house and fix it up, took into an energy-efficient mortgage (EEM) to cover the cost of the upgrades. These mortgages let you roll the cost of the energy-related improvements into your home loan, even if you exceed traditional loan limits. Your mortgage payments will go up a little, but because your utility bills will also go down, you may even make a little money. As an example: Saving Money with an Energy-Efficient Mortgage (EEM) The Murphy The Gonzalez Family's Family's Traditional Energy Efficient Mortgage Mortgage Initial Loan $100,000 $100,000 Cost of Energy N/A $4,000 Improvements Adjusted Loan Amount $100,000 $104,000 Monthly Mortgage Payment $880 $909 Monthly Utilities $126 $71 Total Monthly Expenses $1,006 $980 Net Savings Per Year -- $312 In this case, the Gonzalez family borrowed $4,000 more up front, but wound up saving $26 per month ($312 per year), and with a home that's more comfortable and valuable than the Murphys'.

HANG ON TO YOUR HEAT.

Considering that heating and cooling costs make up about 44 percent of the average home utility bill, you'll want to make this a conservation priority. Start with some small, simple steps. Caulk, weatherstripping and insulation don't sound as exciting as the latest generation solar or geothermal systems, but according to Michael Lamb, a certified energy manager at the Energy Efficiency and Renewable Energy Clearinghouse (EERC), "They're the tried and true fix-ups that work the best." A few weatherproofing projects like the ones listed here easily can cut 10 to 30 percent off the average home energy bill. Find and Fix drafts. Professional auditors use a device called a smoke pencil to locate leaks, but you can get similar results with an incense stick. On a windy day, hold the lit stick next to your windows, doors, plumbing fixtures, electrical outlets, ceiling fixtures and attic hatches--anywhere there's a possible path to the outside. Any change in the smoke column means cold air is entering in or heat is escaping. Find the leaks and caulk them (see Page 74 for more on caulking). Little holes can really add up. According to Lamb, even if your home is insulated, small gaps and cracks can decrease insulation's overall effectiveness by 30 percent. Keeping inside air inside and outside air outside will help your pocketbook no matter what the season. [check] To cut down on spaces where cold air can enter your house, seal doors with a draft-defeating nylon door sweep or a "door snake," a long cloth sack filled with dried rice or beans to hold it in place. If you have an attached garage, install a garage-door gasket to stop cold air in its tracks. Diagnose your ducts. According to Bill Brindle, director of building and utility programs at the Alliance to Save Energy, 20 percent or more of the hot air produced by a furnace never makes it to the homeowner. Ducts lose hot/cold air in two ways: through leaks and through heat transfer in the uninsulated heating or cooling spaces they run through. [check] Look for leaks first. Pay careful attention to where the duct connects to the register (or boot). A loose-fitting connection means air is leaking into the wall or floor. Inspect the duct runs and seal any cracks or gaps, but don't use duct tape. Duct tape may be the cure-all for everything--except actual ducts. The adhesive dries out quickly and it will cease to hold. Mastic, a thick paste adhesive, can be messy to work with, but it's a more effective alternative. [check] Insulate the ducts next -- at least the visible ones in the attic or basement. There are a number of blanket-type and rigid insulation products designed for use around ducts. Insulating will make these areas cooler. If you use the basement for living space, install new supply and return registers rather than relying on pirated heat from uninsulated ductwork.