Gas prices will soar 34% from next week, sending the average annual bill to 1,208 from 902. From January, the ESB will add to the pressure by jacking up electricity prices 20%, with the average bill going to 150 every two months from 126 at present.

Coming on top of soaring mortgage costs - two more interest rate hikes expected before Christmas - households across the country will have to dig a lot deeper just to keep a roof over their heads.

The energy crisis is sure to spark renewed interest in the government's greener homes scheme, which gives generous grants to households to switch to "free" energy sources , helping them escape from the spiralling cost of gas and electricity.

The government will even pick up part of the tab, paying 4,200 towards the cost of installing a boiler that burns wood chips or pellets and 6,500 for a state-of-the-art system that harnesses the earth's natural heat. The Green Party is so taken with the idea that it is urging home owners to use their maturing SSIAs to pay for the other installation costs not covered by the government's grants.

However, heat conservation experts warn that most people risk squandering all the benefits of green energy because their homes are literally leaking cash, with about one-third of the warmth generated by a typical central heating system escaping through the roof, ceiling and walls.

"The first thing you should do is limit the amount of energy you need, " says Jeff Colley, editor of Construct Ireland.

"That means insulation, making your home as air tight as possible while maintaining proper ventilation. Once you've sorted this out, your energy needs will be minimalised, so that you'll need far fewer solar panels or a lower-specification boiler."

Colley believes the whole greener homes schemes is fundamentally flawed.

"Grants are absolutely the wrong approach, " he says.

"All they do is drive up prices because people think they are getting free money from the government. The government should cut VAT on green energy materials instead rather than having a free-for-all by handing out grants."

The attic should be the first stop when insulating your home says Michael Hanratty of Energy Action, a charity that fights fuel poverty among the elderly.

"Some of the most significant energy conservation steps are also the cheapest, " says Hanratty. "Loft insulation costs about 10 per square metre and should pay for itself in two to four years."

Even if the job has been done already, it is still worthwhile having the insulation topped up. "If your attic hasn't been done in the last couple of years, it could probably benefit from additional insulation, " he says. There is no need to throw out the old loft insulation, just lay the new material on top, he says.

After the attic, the next step is to tackle the walls.

Cavity wall insulation is one of the most cost-effective improvements and will pay for itself within a few years by cutting heat loss by up to 20%. Because you only get one shot at the job, it is important not to scrimp on cost by opting for cheaper materials says Paul Gilmartin of Ecobead, a company specialising in cavity wall insulation.

Taking about half a day and using top-of-the-range material such as platinum polystyrene bead, Gilmartin estimates that the job should cost 950- 1,200 for a typical bungalow, 1,000 for a threebedroom, semi-detached house, or 1,200 for a four-bed semi.

The job becomes a lot trickier if you have an older house with solid walls or if your walls are built of cavity block.

Gilmartin warns the home owners should be wary of contractors who claim to have quick-fix solutions to the problems presented by cavity block, a cheaper form of construction common in Dublin and the east coast.

"There are one or two cowboys who suggest you can insulate cavity block - you can't, " he says. "Your only alternative is external insulation which is a big job and could cost 10,000 for a threebed semi. Or you could go for internal insulation by dry-lining on the inside room-byroom." The downside is that the room will have to be extensively renovated and there will also be an inevitable loss of space.

As well as being good for the environment, money spent on energy-proofing home can also be financially rewarding. According to one analysis, 8,000 spent on better insulation and installing green energy sources could knock as much as 1,200 a year off your heating and lighting bills. To make the same sort of return from a bank account, you would need to have about 40,000 on deposit.

WHERE IS HEAT LOST INTHE HOME?

ATTIC Up to 20% of heat lost from a home is lost through the roof. Effective attic insulation can pay for itself within two to three years.

HOT WATER CYLINDER A lagging jacket on the hot water cylinder will keep water hotter for longer and pay for itself within a few months.

WINDOWS For a given area of wall or window, a window will allow up to eight times more heat to escape.

WALLS As much as one quarter of the heat lost from a house can be lost through the walls. Properly insulating walls can reduce this by two-thirds.

DRAUGHTS Badly "tting windows and external doors can account for more than one-sixth of heat loss.

GROUND FLOOR Heat loss to the ground depends on several factors, including "oor type, whether house is one or two-storey, nature of soil and terraced or detached construction.