Home Forums General Discussion Return on investment relative to R values Reply To: Return on investment relative to R values

Ian McChesney

Nik’s question, and the breadth of comment offered, to me point to the need for a better framework to guide our responses to such issues.

The ROI (or value for money) question is always relevant to ask in my view. Most of us would want to know how the benefits of that extra expenditure on insulation stack up alongside alternative ways of spending that money – be it other energy efficiency features, heat pumps, granite sinkbenches or whatever.

Insulation reduces the rate of heat loss in proportion to the inverse of the insulation R value. So, by my reckoning, for example, compared to the heat loss reduction one would get from R5 ceiling insulation, you would achieve over 75% of that benefit with R1.5, and 90% at R2.5.

Diminishing returns set in at quite low R values. I would agree with Norman to a point – that if you have made the decision to insulate the marginal cost of the extra insulation may well be relatively small. But that’s not the only consideration. If you already have 100mm of ceiling insulation, for example, is it worthwhile putting more in? In my assessment the marginal benefits of doing so may be highly dubious in many situations, especially when other more compelling uses for that expenditure exist.

I may sound heretical here but twice in the last two years (for myself and another family member) I elected not to re-insulate and get a heating subsidy (when they existed) through WUNZ:HS, and instead purchased just heat pumps at the market rate. I determined that the marginal benefit to be gained from the extra cost of $3-4,000 from top-up ceiling insulation and replacing underfloor insulation (that would have been required in order to gain the $500 heating subsidy) was a relatively poor investment compared with the approx. 3:1 COP gain from decent heat pumps.

Having experienced both increased levels of comfort and reduced electricity costs I am certain that if the investment had been on the extra insulation rather than the heat pumps the level of benefit would have been far reduced.

I am thus critical of the WUNZ:HS requirements for the absolute priority afforded to insulation, and most particularly the top-up requirements ( and now of course the heating grants being discontinued). I do not think this arrangement is giving us the best value for money or the best outcomes for low income households.