The cheapest way to insulate a building such as a house is when it's under construction and walls and ceilings are open. The cheapest material will depend on how much insulation is needed and where it is installed; exterior walls and attics, for instance, require different types of insulation. The best way to compare costs is with R-value, or heat resistance per square foot.
Fiberglass batts are the traditional insulation for the inside of exterior walls. They are made to fit between wall studs, are easy to install and in 2012 cost on average about 88 cents a square foot for an insulation value of R-19, which is the standard for most of the country. Batts also can be installed in attics but have to be thicker and are slightly more expensive.
Loose Fill Cellulose
Loose fill cellulose is another cheap insulation material, usually installed only in attics. It must be blown in with an air hose and does not work well in walls. But costs only 73 cents a square foot for R-19. Most attics, however, require at least R-26 so it would take about 50 percent more material. Wool is another blown-in insulation that costs from $1 to $3 a square foot.
Spray foam is a newer and increasingly popular insulation option. It must be installed by professionals. It is sprayed onto surfaces as a liquid but expands to fill all cavities. It's the most efficient material because it leaves no gaps for air. It needs to be only about half the thickness of fiberglass or cellulose, but costs about $3 a square foot. It is the most practical, however, to add to walls in an existing structure. It also has some structural value and improves soundproofing.
Rigid foam insulation is the only type suitable for use on the outsides of walls or on roof decks. Other materials are subject to moisture deterioration. Polyisocyanurate is the cheapest material at about $3 a square foot but is hardest to install. Extruded polystyrene, or XPS, is the most common exterior insulation, at about $4.30 a square foot.
The federal Department of Energy in 2012 estimates the typical cost to insulate a house attic at $1 to $1.50 a square foot, depending on the amount of insulation required, and about $1.75 a square foot for walls, both inside and outside the cavity. That's figured on an average R value of about R-20. The Energy Department says attics should have between R-30 and R-60, depending on the climate
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