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1991-02-20
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ZIP, The ZIP-Code Insulation Program
If you are a new user, read ZIP.DOC, a user's guide to the ZIP program
on this disk. The following is a short summary of the user's guide:
ZIP, the Zip Code Insulation Program, determines economic levels of
insulation for new and existing houses in any location in the United
States, given the first three digits of its Zip code. Economic
insulation levels are determined in ZIP using life-cycle cost princi-
ples. That is, the level of insulation which has the lowest initial
cost plus energy cost, in present-value terms, is designated as the
economic level. Economic levels are determined for attics, cathedral
ceilings, exterior walls, floors over unheated areas, slab floors,
basement and crawlspace walls, and ducts in unconditioned spaces.
In addition, ZIP will determine if a water heater insulation jacket is
a cost effective investment, based on information supplied by the user.
For new houses, a thirty-year life is used in calculating the economic
level of insulation. That is, the economic level of insulation calcu-
lated for a new house will be the level which has the lowest initial
cost plus present-value energy cost over a thirty-year period. For
existing houses, a twenty-year life is used.
In performing these calculations, a seven percent annual rate of
return, over and above general inflation, is used to discount future
savings to present value. If inflation is five percent per year, this
is approximately equivalent to requiring a minimum 12 percent rate of
return on the investment over the life of the insulation. That is,
the last increment of insulation used in each application must earn at
least this rate of return to be considered cost effective. Moreover,
residential energy savings are not taxed. Thus, for homeowners this
12 percent rate of return is an after-tax rate, significantly higher
than most tax-free investments available to homeowners.
The economic levels of insulation calculated by ZIP are based on an
incremental type of analysis. Successive levels of insulation in each
part of the house are evaluated to determine how far it pays to keep
adding insulation and when to stop. For example, in an attic an
economic analysis is performed at R-0 (no insulation), R-11, R-19, R-
22, R-30, R-38, and R-49. As long as the additional insulation needed
to increase the total R-value from one level to the next is found to be
cost effective, that increment will be included in the recommended
insulation level for that application. If it is not cost effective,
that increment will not be included. In general, the more severe the
climate, the higher the cost of energy, the lower the heating and
cooling system efficiencies, and the lower the cost of insulation, the
more it pays to add insulation and the higher will be its economic
level.
Note that the first increments of insulation typically return much
higher dividends than the last increment. Thus the average rate of
return on the entire investment tends to be considerably higher than
the minimum acceptable level, especially if there is little insulation
to start with.
The economic levels computed by ZIP reflect the type and approximate
energy efficiency of the heating and cooling systems specified by the
user, as well as local energy prices and current installed insulation
costs. Local climate data for the three-digit Zip code are retrieved
from the ZIP disk. Default energy and insulation price data are also
retrieved from the ZIP disk, but it is recommended that users override
these latter values with estimates of local energy and insulation
prices if available.
Six different heating systems can be selected in ZIP: four furnaces
types, including natural gas, fuel oil, LPG, and electric resistance;
electric baseboard; and electric heat pump. If a heat pump is
designated for space heating, it will automatically be assumed to
provide space cooling as well, and no cooling questions will be asked.
Otherwise, two electric cooling systems can be selected: central and
window air conditioners. (An evaporative cooling system can also be
selected. However, no cooling savings from insulation are calculated
for this latter system.) In addition, the user can specify the
approximate operating efficiency of the heating and cooling systems
(low, medium, high, or very high). These system specifications are
needed to calculate the purchased energy savings corresponding to any
given reduction in space heating and cooling loads. If there is
ductwork in attics, crawlspaces, or other unconditioned spaces, an
adjustment is also made to the equipment efficiency to reflect duct
losses (10% for one-story houses, 15% for houses with two or more
stories).
Current energy prices for heating and cooling, corresponding to the
type of systems selected, are then requested in the units shown (e.g.,
kWh, therms, gallons). Default values are retrieved from data files on
the disk. These default values reflect energy prices at the state
level (or, in the case of electricity, at a representative location
within the state, based on the ZIP code entered for the analysis).
However, it is recommended that the user overwrite these default values
with energy prices that reflect the utility rates actually encountered
at the building site. These prices should include all taxes and fuel
adjustment costs (but not kW demand charges, if any).
If declining (or increasing) block rates are applicable (for example, kWh
prices are often lower for kWh usage above 500 kWh per month than for the
first 500 kWh), the energy cost should reflect the cost of the last
units purchased each month (during the months of major usage), not the
average cost for all units. If there are different prices for summer
and winter usage (as is often the case for electricity), the price used
for cooling should be based on the summer rate and the price for heating
on the winter rate.
Default insulation prices are also provided for the ZIP analysis. However,
it is recommended that the user overwrite these default values with prices
that are more representative of the actual building design and site. Be
sure to read the guidelines for determining appropriate insulation prices
displayed by ZIP at the point where insulation costs are entered.
If the ZIP menus are difficult to read on your monitor, try starting ZIP
with a /M, e.g., ZIP2 /M. This will force a black and white screen display.