Sustainably harvested wood can be the best solution for home-heating and hot water for four reasons:
1. The best wood-burning stoves/furnaces can get up to 80% efficiency, compared to 30-40% efficiency from the wood-stoves of the past. This means more heat and less smoke/particulate.
Natural-gas furnaces get up to 87% efficiency and have slightly lower emissions than wood, but there is no such thing as sustainable natural gas or propane.
2. The C02 emissions from sustainably harvested wood can be recaptured by the plant cycle, vs burning fossil fuels that puts C02 into the atmosphere that was trapped under-ground.
3. It takes 10 acres of sustainably-harvested forest to fuel a large but well-insulated home using a modern wood-furnace/stove. These 5 cord of wood can typically be purchased for $100 per cord if you cut/split it yourself, or $200/cord delivered cut and split. That's $500 and some weekend labor to heat our home, compared to $3000 that I would spend annually if I relied on propane.
Here are two great calculators of costs of various fuels, but you'll have to adjust the $ for today's fuel prices.
http://www.woodboilers.com/fuel-costs-comparison.asp
http://www.hpba.org/hpba1/effcalc.cfm
4. Sustainable wood creates LOCAL jobs. The $ you spend on firewood stays in local pockets, vs going to big oil/gas companies. The impact of local economies taking care of local fuel needs cannot be understated.
I would be happy to help answer any questions people have on whic h types of wood-stoves are the best to use. I have an inexpensive "regular" wood stove that gets 67% efficiency (the best you can get without catalytic or gasification) and I use 5 cord annually to heat a 2100 square foot home.