All about chimneys
from woodheat.org

The chimney is the engine that drives a wood heat system

No woodburning stove, fireplace or furnace can function properly without a good chimney. A good chimney is:

• the correct type for the appliance because there are a lot of options, some unsuitable;
• the correct size for the appliance, which is usually the size of the appliance outlet collar;
• properly located, meaning up through the heated space of the house;
• and properly installed following building code or manufacturer's instructions exactly.

A good chimney and system design produces desirable performance characteristics:

• Fires are easy to light and draft builds quickly
• Smoke does not fill the room when you try to light a fire
• No smoke spillage when you open the door to tend the fire
• No foul odors or cold air from the hearth when it is not in use

When planning a woodburning system, the first thing you need is reliable advice on matching the appliance to the right type and size of chimney. Most wood heat retailers and chimney sweeps can guide you and there may be government agencies and publications you could get locally. Also, unless you have done it before, we strongly recommend having your chimney professionally installed by someone whose references you have checked. You never want to lie awake at night wondering if an incompetent chimney installation is putting your house and family at risk.

This is good wood stove performance:
(hint: it's really the chimney that's doing the performing!)

• When no fire is burning and you open the stove door, air flows into the stove, not out.
• When you light a kindling fire, the smoke immediately flows up the chimney, not into the room.
• A properly built kindling fire burns bright and hot very quickly.
• When you open the stove door to add more wood, smoke does not spill out.
• If you are careful, you can run the stove so that you never smell wood smoke in the house.

Understanding how chimneys work

Think of the chimney as the engine that drives the wood heating system. Think of its fuel as heat. Think of the power it puts out as draft. The more fuel (heat) you give this engine (chimney), the more power (draft) it will deliver. So, the hotter the exhaust gases, the more draft is produced. Draft, by the way, is good. It's the suction that keeps the smoke from coming into the room. Insulation in the chimney is important because it helps to keep the exhaust hot until it is expelled outside, and so, increases draft. The chimney works with the stove or fireplace in a kind of feedback loop. Heat in chimney makes draft, which pulls in more combustion air, which makes the fire burn hotter, which delivers more heat to the chimney which makes more draft and so on. An insulated chimney makes more draft with less heat. In winter, a well-designed and properly installed chimney makes some draft and flows some air upwards, even when no fire is burning. When you build a fire in a stove connected to such a chimney, the kindling ignites easily, draft increases rapidly and you have a nice bright, hot fire right away—and no smoking. This is the kind of system you want in your house.