A simulation program was used to investigate the sensitivity of efficiency and relative operating cost of typical systems to these parameters: system cycle rate; excess air, and firing rate and associated changes in flue temperature, off-period draft flow, draft control air flow and system balance temperature.Energy conservation by reducing the firing rate of generally oversized systems was studied for three situations:Optimum firing rate for an existing heating system and house.New furnace/boiler retrofitted to an existing house, andNew furnace/boiler for a new house, in which furnace, ducts and chimney canbe matched to each other.The analysis showed that savings achievable by reducing overcapacity can be twice as high if the draft control air flow can be reduced simultaneously with the firing rate, rather than reducing the nozzle and combustion air flow alone.