Mechanical Insulation Design Guide - Design Objectives

by the National Mechanical Insulation Committee (NMIC)

Last updated: 11-12-2010

Mechanical Insulation Financial Calculator

This calculator determines the simple payback period,the annualized rate of return, and the NPV from an insulation project.

Instructions

  • Line 1. Enter the cost of installing or replacing insulation
  • Line 2. Enter the estimated savings during the first year
  • Line 3. Enter the projected annual energy cost escalation rate
  • Line 4. Enter the estimated useful life of the insulation system
  • Line 5. Enter the discount rate for Net Present Value calculation

Note: Calculator ignores any savings after 20 yrs

Assumptions

  • Simple payback period is calculated as the initial cost divided by the first year savings
  • Assumes investment and annual savings occur at end of year

Note: Calculator may be used for a single item or an entire project

1. Investment (Initial Installed Cost), $
2. First Year Energy Cost Savings, $/yr   
3. Energy Cost Escalation Rate, %/yr
4. Estimated Economic Life, yrs
5. Discount Rate , %