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Below grade you should not be using EPS foam - that should be XPS (pink or blue, normally) - above grade EPS is fine. EPS is not waterproof, XPS is. You can also increase your subgrade insulation a bit by setting a sheet (or portion of a sheet) going flat or angled slightly downwards away from the house at the top of the footing. If drainage is a concern ...


Filling back in with dirt is fine, and maintains where the frost line currently is and doesn't affect drainage. you can then top it with a decorative soil of you choosing. It is also much cheaper as you can reuse the dirt that you had to shovel out when digging the trench. (that will be a lot of dirt)

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