Is insulation upgrade a good investment?

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Calculator uses 6 variables to determine payback period

By Paul Bianchina, Friday, December 28, 2012.Inman News®

We often talk about the importance of energy upgrades for your home. But if you’re thinking about an upgrade this winter, such as adding more insulation to your attic, you may be wondering exactly how to calculate whether that’s a wise financial investment.

There are a variety of formulas available for making this calculation, such as the one from the U.S. Department of Energy (DOE).

It’s not a terribly difficult formula to use, and I’ve modified it here to make it a little more understandable.

You’ll need to do a little research to track down some basic information to fill in the blanks, all of which you can get off the Internet or with a couple of phone calls. Then it’s just a couple of minutes with a tablet and a calculator.

Incidentally, this formula also works for upgrades to wall insulation.

The formula and definitions

The DOE’s formula is as follows: (Ci x R1 x R2 x E) ÷ (Ce x [R2 – R1] x HDD x 24)

OK now, don’t let your eyes glaze over, or have terrifying flashbacks to high school algebra class. Here’s what all those variables stand for:

  • Ci: This is the cost of the insulation you’re considering, in dollars per square foot. If you’re doing the work yourself, it’s the cost of the materials, supplies and any rental equipment you need. If you’re having the work done, it’s the estimated cost from the contractor.
  • R1: This is the R-value of the insulation you currently have in the attic.
  • R2: This is the R-value you want to upgrade to.
  • E: Efficiency rating of your heating system. How well your heating system heats your home plays a major role in how much you’re going to save with an insulation upgrade; the less efficient your heating system is, the more energy dollars the additional insulation will save you each year. You may know the specific energy efficiency rating of your particular heating system, or you may be able to get it from your utility company or HVAC contractor. If not, the DOE offers the following general suggestions: oil and propane furnaces, 0.6 to 0.88; natural gas furnaces, 0.7 to 0.95; electric, 1.0; heat pump 2.1 to 2.5.

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