RE: How will you handle the utility increases?
We use a coal stove for the main heat in our home here on Long Island. The house is a small (1500 sq ft) levitt style house, and we have a 65,000 btu gibralter stove installed in the living room. The stove is quite oversized for the house, and because of this, it keeps the whole house, including the two bedrooms upstairs, toasty warm all winter.
Coal is readily available here from at least three or four sources. We have a wood coal bin in the back yard, and at the start of the heating season (about a week from now) we have a two ton delivery made. Coal is running about $245 a ton, so our investment for the winter is about $500. We do have a fuel based hot water system in the house, which we keep on at a minimal setting of 55 degrees, just in case the coal stove goes out while we're away.
The only real drawback to this system is that the coal stove requires daily attention. Normally we have to bring in two buckets of coal every day to day and a half. The stove requires "shaking" periodically, and ash removal needs to be done twice a day. We have been very happy with the coal stove, but as we are getting a bit older, and are out of the house for days at a time on business, we are looking to swap the coal out for a pellet stove - but we're still in the discussion stages. There are advantages and disadvantages to both of these alternative fuels.
Bottom line is, however, that you DO have options if you're tired of being held hostage by the fuel oil and electric companies, but you h ave to be willing to do a little labor to make them work for you.