Have a question about heating system options for my home improvement project. We currently live in an approximately 1800 sf old two-story farmhouse (originally built in 1917, with several poorly constructed additions added later). A forced air propane furnace heats the first floor, but there are no ducts to the second floor. There are three upstairs rooms, currently one is heated with an in-wall electric heater with a thermostat. The other two rooms are heated with plug-in space heaters when in use, which is expensive so our living area tends to shrink significantly in the winter. We live in MN so winters get seriously COLD, and the price of propane is getting ridiculous.

We have done some things to improve efficiency - blow-in insulation in the walls, lining the foundation with rigid foam insulation, new windows - but the house would require fairly extensive renovation to get it up to 'modern' standards and, because it wasn't well constructed in the first place, probably isn't worth spending the money on. Initially we looked at building a new home, but cannot afford that much cost right now. We may still build a house in the future, but what we are looking at doing now is building a two-story garage with upstairs loft space for additional living area, attached to our current home by a heated breezeway. We want to install an efficient system to heat both the old house and the new garage, without having to do very much retro-fitting on the house.

One of the options we are looking at is an outdoor wood gasification boiler (we have 17 acres and plenty of wood available). I understand it can be adapted to a forced air furnace so we could use that as our primary fuel source, but have propane for back-up. Is there a way I can also use it to heat the upstairs rooms without installing duct work? What would I need to install in the garage to heat it with the boiler? I'd like to have the upstairs heated to living area temps, but the downstairs garage part can just be at 40 or 50 degrees.

I'm also interested in hearing any other suggestions for efficient heating systems that would meet our needs. We don't know a lot about this stuff and want some independent opinions before talking to the sales people. Thank you for your time!