1554 Economic Thickness ETI Calculations

Section 15.5.3 developed the financial analyses often used in evaluating a specific insulation investment. As presented, however, the methods evaluate only two options rather than a series of thickness options. Economic thickness calculations are designed to evaluate each 1/2-in. increment and sum the insulation and operating costs for each increment. Then the option with the lowest total annual cost is selected as the economic thickness. Figure 15.5 graphically illustrates the optimization method. In addition, it shows the effect of additional labor required for double- and triple-layer insulation applications.

Mathematically, the lowest point on the total-cost curve is reached when the incremental insulation cost equals the incremental reduction in energy cost. By definition, the economic thickness is:

that thickness of insulation at which the cost of the next increment is just offset by the energy savings due to that increment over the life of the project.

Historical development

A problem with the McMillan approach was the large number of charts that were needed to deal with all the operating and financial variables. In 1949, Union Carbide Corp. in a cooperation with West Virginia University established a committee headed by W.C. Turner to establish practical limits for the many variables and to develop a manual for performing the calculations. This was done, and in 1961, the manual was published by the National Insulation Manufacturers Association (previously called TIMA and

Thickness

Current Standard Upgraded Thickness

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