Question : Is there a way to calculate energy savings for external, 2inch insulation on basement walls that does not extend above the soil surface, leaving the top couple feet of foundation wall exposed to air.

Background: I am having my basement foundation walls waterproofed externally. The contractor is offering to provide external insulation for what seems like a reasonable price, and according so some research, there are some advantages to doing this externally if you have the opportunity. Some sources also suggest that the payoff is rather quick, 2~5 years (but did not state what assumptions were behind that).

The hesitation comes from the fact that what is under discussion is cutting the foam board short of the top of the soil. Basically if we wanted it to go all the way up (as would be ideal) I'd need a different contractor to tie into the siding and protect the exposed insulation. Currently there is about 2.5ft of exposed block below the start of the siding, which is the norm for this neighborhood. I do know that a large part of the value of the insulation comes from the top few feet below the soil and the part exposed to the air.

I do not plan on finishing my basement in the near term or trying to keep it the same temperature as the rest of the house. House is small (850sq foot bungalo), in lower Michigan.

  • Are you heating the basement, since its not finished? Commented Oct 10, 2011 at 16:11
  • Last winter, I typically left the heat vents partly open, and run a couple space heaters (which only help a little) if I'm going to be hanging out down there, which is not frequent. I did have playstation/wii set up in the basement and it wasn't all that comfortable.
    – derekv
    Commented Oct 10, 2011 at 17:02

3 Answers 3


Rather than go to the trouble and expense of tying external insulation from below ground to the siding, I'd let them stop with the below ground insulation. It at least will add a little extra R value.

Then, since your basement is unfinished, but you do use it, I'd go ahead and add additional insulation on the inside of the house* - from the ceiling on down, at least to several feet below the external ground level if not all the way down. (Those extra few feet won't do much on the bottom but they will help some and they won't cost much more...)

*Making sure that any other potential water issues have been dealt with

The key thing with insulation is to get a continuous thermal break. Even a small gap in the insulation can allow huge amounts of energy loss, and since you are running heat downstairs, while I don't know precisely how to calculate the long term savings, there will be one, and more importantly, your basement will be much more comfortable for year round use.


You are correct in that most of the heat loss in cold climates will be in the exposed part of the wall. Below the freeze line (few feet in MI) the ground temp is actually pretty stable.

That said, you're exposing the foundation to waterproof...the extra cost of insulation at this point in time is miniscule so you might as well do it now. Be sure that they waterproof the insulation as well, though (foam insulation will eventually become waterlogged if exposed to the ground and become much less useful in terms of insulating).

All that said, if the basement is properly waterproofed and you are confident it is dry, you can certainly install the insulation on the inside at some point.


One other things - wrt your question about calculating the savings.

I don't know the formulas, but I do know that the math in calculating actual savings is very complicated, and depends heavily upon multiple factors including how long your furnace operates and the relative outside temperature.

If you think about thermal energy transfer like water in a tall pipe, it'll help to understand. Take a 10' long pipe and stand it on end and fill it with water. Now drill a hole at the very bottom. Water starts to leak out - and it comes out in a FAST stream, right? But as the pipe starts to empty, the water starts to slow, because its under less pressure.

The same is true of heat transfer. If it's 76 outside and 78 inside, energy transfer from inside to outside will be VERY slow - and insulation will slow that transfer even more, by a relative resistance called R-Factor.

Now if it's 78 inside and 20 outside, the temperature change is much greater, and so energy will STREAM out of the "hole", under much greater pressure. In that case, insulation will help - and it will help MORE in total dollars, but relative to the temperature difference the R-factor remains the same.

Based on the above, I doubt you'll ever get an exact answer - and your best option is to look at the R-Value and go for the highest R-value per dollar you can get.

  • Thanks for comments, yes I agree without some sort of tightly controlled experements or measuremants, knowing precisely is going to be hard. I wonder in particular about air, like the continuous thermal break that will not be provided by the external insulation, will make what is there basically worthless. I know however that its going to bother me a lot more later wondering if I should have done it, than wondering if I overspent to have it done, so I decided to go for it.
    – derekv
    Commented Oct 11, 2011 at 15:41

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