Insulation: Are we saving money?

A huge part of our renovations is the upgrade to the insulation.  In every room we work on, we remove the existing drywall and insulation, and install new Roxul and rigid insulation.  We know it increases the insulation for the room but how much will it reduce our energy bills?

We have just completed our heat load calculations.  This is a pre-requisite for LEED homes: to know how much energy is being consumed in heating and cooling each room.  It is important information to know in order to properly size your furnace and ducts. The results?

Pre-renovation our home required 67,000 BTUs at peak demand.  Pretty typical for a bungalow our size in Montreal.  When we have completed the whole house: 36,000 BTUs.  That is with upgrading the insulation in the walls from R-8 to R-24 and in the ceiling from R-30 to R-50. So a reduction of 45%, but does it save money?

I estimate that the material costs per foot of wall is about $18.  This includes the Roxul, rigid insulation, drywall, vapour barrier and a couple dollars for screws, mud and paint.  To re-insulate the entire house it is then approximately $6390*.  Our heating bill should go from roughly $1500 a year to $825: a savings of $675 a year.

If we were to add that investment to our mortgage and then paid it off with the savings it would take approximately 13 years to pay back.  Not bad ... but it could be better.  If you were really looking for the best bang for your buck: forget the basement.

Because the basement is underground there is minimal air leakage and it is not subjected to the same temperature extremes: your basement floor is probably the same temperature year round.  On top of all that you already have 8" of concrete separating you from the outside world.  Not the best insulation but better than the 1/4" OSB sheathing on your main floor.  So financially, if your basement is already insulated, upgrading it doesn't produce as significant a savings.  Don't get me wrong it is worth doing (and essential if it is currently uninsulated) but not as critical as the upstairs and attic.

For our house 50% of the cost is in insulating the basement, but only 20% of the energy savings. So if we were doing only the upstairs the cost would be $3195 and a savings of $540 years.  That drops the payback period down to only 7 years.  That is a pretty good return on investment.

*one thing to keep in mind I am basing this all on material only as my labour is apparently free