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Maintaining Montana’s Mechanical Insulation: Energy appraisal of commercial buildings

All images courtesy National Insulation Association

All images courtesy National Insulation Association

by Christopher P. Crall, PE, and Ronald L. King

In 2010, a mechanical insulation energy appraisal was conducted on various facilities around Helena, Montana. The objective was to determine the energy, cost, and emission reduction opportunities available through repair, replacement, and/or maintenance of mechanical insulation systems in 25 pre-selected facilities.1

The Mechanical Insulation Assessment Pilot Program was part of the data-gathering goal of the Mechanical Insulation Education and Awareness Campaign (MIC). Executed under the U.S. Department of Energy’s (DOE’s) Advanced Manufacturing Office in conjunction with the National Insulation Association (NIA) and its alliance partners, MIC seeks to raise awareness of the energy efficiency, emission reduction, economic stimulus, and other benefits of the material in the industrial and commercial markets.

The potential of mechanical insulation—thermal protection for piping, equipment, and other devices—to play a significant role in reducing energy intensity is immense. Unfortunately, the lack of sufficient data to support its energy efficiency potential, combined with a deficient understanding of what mechanical insulation is and how it can be used, impedes policy- and decision-makers in developing supportable cases for increased use and maintenance of the mechanical insulation.

This is an example of an uninsulated end cap on steam header.

This is an example of an uninsulated end cap on steam header.

The study
The overall approach of the program was to assemble a team of insulation professionals to conduct an appraisal of State of Montana facilities in the Helena area. The assessment team, with assistance from state personnel, performed tasks including:

  • identifying opportunities to improve insulation in the mechanical rooms visited;
  • estimate costs to improve or upgrade the insulation systems;
  • estimate savings (in dekatherms, dollars, and carbon dioxide [CO2] emissions) associated with the insulation upgrades, and calculate resulting payback period and return on investment (ROI).

The list of candidate buildings in the area was developed and prioritized based on the energy-saving potential from mechanical insulation. Based on the program, buildings with steam and/or hydronic heating systems were included, while those with forced air furnaces were not. The 25 facilities visited ranged from office buildings, assembly facilities, and dormitories to maintenance facilities and museums—representing roughly 1.3 million sf (120,774 m2).(As the original research focused solely on imperial measurements, conversions to metric throughout this article are approximate.)

The study’s scope was limited to the assessment of mechanical insulation on piping and equipment in mechanical rooms. Opportunities for repair and replacement of insulation on piping and ductwork within the building itself were not considered. This study should not be considered an energy audit of the buildings visited. Energy conservation opportunities related to building envelope insulation or sealing, lighting, controls, ventilation, and equipment maintenance were also outside the study’s scope.

For each mechanical room, an insulation summary identifying items where the material was missing or had sustained significant damage was developed. The team also identified the thicknesses required to bring the insulation level up to the existing level. No attempt was made to ‘optimize’ the level of insulation or to identify whether the standing level would meet or exceed those required by local building codes. Also, no assessment was made of the existing insulation’s efficiency. Additional savings may be possible by upgrading the level, but these savings would be minimal compared with insulating the uninsulated or damaged items identified.

These uninsulated unions and valve bonnets are used in heating hot water lines.

These uninsulated unions and valve bonnets are used in heating hot water lines.

During the field visits, additional information was collected about the energy systems in each mechanical room to enable the estimation of energy savings, including:

  • the mechanical room’s location within the building;
  • operating temperatures;
  • estimated hours of operation;
  • estimated efficiency of the equipment; and
  • general control strategies.

Budget-type cost estimates were also developed based on the summary information on a facility-by-facility basis.

Assessment findings
Each of the facilities chosen for analysis had at least a few items requiring insulation. The smallest number of individual items identified in a building was 14. It included:

  • one 12-ft (3.6-m) long, 2-in. (51-mm) copper tube;
  • one 3-ft (0.9-m) long, 3/4-in. (19-mm) copper tube;
  • six 2-in. 90-degree elbows;
  • five 2-in. ball valves; and
  • one 3/4-in. ball valve.

The largest concentration of items was in a boiler plant facility that provides central steam and domestic hot water to four buildings in the Capitol Complex. Approximately 400 individual items were identified in this facility (including tunnels), and savings due to insulation provided an estimated payback of four years.

Overall, approximately 3500 items were identified. Estimated total savings were approximately 6 billion Btus per year, with an estimated payback of four years and an annualized rate of return of 24 percent. These projected savings are primarily in natural gas use and represent roughly eight percent of the total analyzed facility’s natural gas consumption.

As expected, some items identified were large, such as the uninsulated flanged end cap on a large, low-pressure steam header shown in Figure 1. The majority, however, were relatively minor like the uninsulated unions and valve bonnets on the hot-water heating lines shown in Figure 2. While the savings from any single item is small, the total savings from thousands of small items is significant.

Figure 3 summarizes the overall results of the appraisal, sorted in order of decreasing energy savings. Building energy usage information was derived from data provided by the State of Montana and, in most cases, is the average consumption over a four-year period (i.e. 2007 to 2010).2

Energy Use Intensity (EUI)—measured in units of kBtu/sf/yr—is the annual building site energy consumption (electrical and natural gas) per square foot of gross building area. Available EUIs for the Helena buildings range from a high of 193 to a low of 47.3 The unweighted average EUI for these buildings is roughly 92 kBtu/sf/yr. For reference, the U.S. Energy Information Agency’s (EIA’s) 2003 Commercial Building Energy Consumption Survey for this climate zone lists average EUI values for offices at 92 and assembly buildings at 102.

Numerous key assumptions were required to develop the energy savings estimates, including the operating hours of the mechanical systems involved. Heating systems are assumed to operate for eight months during the winter, or 5840 hours per year. Additional assumptions include an operating temperature of 80 F (27 C) and ambient conditions inside the mechanical rooms with 1-mph (1.6-km/h) wind speed.

The results of the appraisal are summarized in this chart.

The results of the appraisal are summarized in this chart.

The total estimated savings are approximately 6 billion Btu/yr. The weighted average savings are 4.6 kBtu/sf/yr. This represents 8.2 percent of natural gas usage in the facilities studied. In most cases, the insulation opportunities identified will reduce natural gas consumption. However, a few of the buildings have electrically heated domestic hot-water systems—in those buildings, a small portion of the energy savings due to mechanical insulation shows up as electrical energy savings. These electrical energy savings are expressed as dekatherms and included in the estimates.

The savings estimates in Figure 3 are converted to the associated reductions in CO2 emissions (annual metric tonnes) and then to financial savings ($/sf/yr).

Insulation cost estimates were prepared on a facility-by-facility basis using the summaries developed during site visits. The estimates assume various insulation systems depending on the application. The primary insulation system used in the estimates was fiberglass pipe insulation with all service jacket and removable/replaceable flexible insulation covers.

A building’s boiler installation is shown here.

A building’s boiler installation is shown here.

Column 12 in Figure 3 shows the estimated payback period of the insulation project in years, while column 13 gives the annualized rate of return (assuming a 20-year life and no fuel cost escalation4). The estimated payback periods range from 1.8 years to 10.7 years. Corresponding annualized returns range from seven to 54 percent.

As might be expected, the steam-heated facilities generally showed shorter payback periods. Steam supply piping operates at roughly 230 F (110 C) during the heating season, while hot-water supply temperatures are normally reset in a range from 120 to 180 F (49 to 82 C) based on outdoor conditions. Insulating steam systems will therefore not only exhibit greater energy savings, but also quicker payback.

The variation in financial returns is not unexpected. All the buildings inspected had mechanical insulation on their steam and hot water lines, although some systems were in better shape than others. Several had been recently upgraded to high-efficiency condensing boilers with well-insulated piping (Figure 4). While numerous small items were identified in each of these facilities, the ‘low-hanging fruit’ had been gathered.

Significance of results
The results of this study demonstrate there are numerous opportunities for improving the mechanical insulation application in steam- and hydronic-heated buildings. One question prompted by the appraisal is, ‘Why are there so many pieces of missing insulation?’

In many locations, it was obvious a maintenance task had required removal of the insulation, which was simply not replaced after the maintenance was completed. This was observed in several locations where a domestic hot-water (DHW) storage tank had been removed and replaced with a newer tank, and piping connections to the tank were left uninsulated. It is possible the personnel performing the work did not have the materials or proper training to complete the job.

This uninsulated condensate tank was installed in a corrections facility.

This uninsulated condensate tank was installed in a corrections facility.

In some areas, either mechanical damage or leaks had occurred and the damaged insulation had not been replaced. More common, however, were items that had never been insulated. For buildings and systems designed and built when energy was less expensive, the ‘extent of insulation’ was not nearly as complete as it is today. Items routinely left uninsulated include:

  • pipe unions;
  • strainers;
  • steam traps;
  • condensate tanks;
  • expansion joints;
  • valves;
  • flanged joints;
  • pumps; and
  • tanks.

The DHW systems in the buildings illustrated the interactions often present in energy conservation projects. Numerous buildings contained newer high-efficiency DHW storage tanks. Some buildings, however, used older conventional-style gas-fired water heaters. For older DHW tanks, the addition of a 1.5-in. (38-mm) thick tank blanket to minimize heat loss was analyzed. These DHW tanks typically operate year-round (i.e. 8760 hours). For a typical 24 by 60-in. (610 by 1524-mm) tank, energy savings can be approximately $30 annually. These savings were included in the analysis where applicable. Depending on the age of the DHW tank, it may be more reasonable to consider replacing these tanks with high-efficiency units. This alternative (and mutually exclusive) option was not investigated in this study.

A related interaction issue concerns the DHW circulating systems. Most of the buildings studied use circulating pumps in the DHW loops. These pumps minimize city water consumption since occupants have hot water at fixtures on demand, rather than waiting for hot water. Some facilities have been fitted with timers to limit the circulating pumps operating hours—and the associated heat loss from DHW piping—to occupied hours.

In other buildings, the circulating pumps continuously run. For these facilities, the insulation replacement items are appealing because savings are directly proportional to operating hours. The alternative option of installing a timer to limit hours of operation would reduce the savings from insulation. The two options, however, are not mutually exclusive, and installation of timers should be considered in addition to replacing any missing insulation in the DHW loop.

A condensate piping assembly is seen here.

A condensate piping assembly is seen here.

Extrapolating the findings statewide
One of the program’s objectives was to use the results to estimate possible savings if the study were expanded to cover similar state-owned buildings. The State of Montana has an inventory of approximately 2000 different types of buildings, from roadside rest facilities and historical village gift shops to prisons and university football stadiums. Many of these facilities are small, seasonal, and with specialized use and/or limited occupancy. As the study’s results do not apply to all facilities, extrapolation to every state building is not accurate. However, projections to similar state-owned facilities are possible and may be useful.

The initial step toward that objective was to review a list of state buildings considered potential candidates for inclusion in mechanical insulation upgrade projects. The information provided included:

  • building designation and location;
  • year built;
  • occupancy code;
  • gross area (in square feet);
  • number of stories; and
  • number of full-time employees.

The list contained a total of 142 buildings with a total gross area of 2.35 million sf (218,322 m2).

The pilot study of Helena buildings covered several of the larger state buildings, representing a significant percentage of the total. Overall, approximately 55 percent of the square footage identified on the candidate list was included in the study discussed. As a first-order estimate, the energy savings from the Helena study can be prorated based on building area. Annual energy savings from the 25 facilities analyzed averaged 4.6 kBtu/sf/yr, which is about $0.043/sf/yr. If these savings were prorated to the statewide candidate list (i.e. 2.35 million sf [21,8322 m2]), they would total 10,800 DKT, or $101,000, annually.

However, additional analysis could refine this estimate. For example, it was determined steam- and hydronic-heated systems will have more opportunities for mechanical insulation than their forced-air counterparts. Additionally, some candidate buildings have already been addressed. More information about the building inventory statewide would allow a more precise estimate, but an order-of-magnitude statewide savings of 10 billion Btus—eight percent savings annually—is not unreasonable. Installation costs would be similar, so annualized returns of 24 percent could be achieved.

This is an uninsulated steam valve.

This is an uninsulated steam valve.

Approximately 3500 items were identified in 25 buildings and 56 mechanical rooms in the pilot program, with estimated annual energy savings of approximately 6 billion Btu per year, a resulting overall payback period of four years, and an annualized rate of return of 24 percent. Associated reductions in CO2 emissions are estimated at 300 metric tonnes per year.

While the savings from a single item is small, the aggregated total savings from thousands of small items is significant. The appraisal results confirm the value of addressing missing, damaged, or uninsulated areas. The payback period and internal rate of return are based on actual operating conditions, 80-F (27-C) ambient temperature, service temperature, and hours of operation (in many cases, less than half a year).

The results tell an impressive story for the maintenance of mechanical insulation in commercial building applications. The findings confirm the energy savings, emission reduction, and financial benefits of looking at mechanical insulation differently.

1 An earlier version of this article appeared in the May 2011 issue of the National Insulation Association’s Insulation Outlook publication. (back to top)
2 Annual Heating Degree Days over this four-year period averaged 7751, or about 0.9 percent higher than the long-term average for Helena. Visit (back to top)
3 For site EUI calculations, 1 kWh of electrical energy is 3412 Btu and 1 dekatherm is 1,000,000 Btu. Electrical consumption at the Montana Law Enforcement Academy Complex is billed from a master meter, so EUI could not be broken out for the portion of that campus analyzed. (back to top)
4 Energy costs are volatile and notoriously difficult to predict. While long-term energy costs are expected to increase, recent natural gas costs have been falling. A fuel cost escalation rate of 0 percent seems reasonable for this analysis. If a three percent annual fuel cost escalation rate was assumed, annualized returns would increase by about three percent. For example, the 27 percent return estimated for the Capitol building would increase to 30 percent if a three percent/yr fuel cost escalation rate was used. (back to top)

Christopher P. Crall, PE, is a mechanical engineer with experience in thermal insulation and energy usage in commercial buildings and industrial applications. He is currently providing consulting services in the areas of building energy standards, energy analysis, heat and moisture transport, and mechanical insulation specifications and applications. Crall is an active ASHRAE member and was the primary author of the 2005 ASHRAE Handbook chapter titled “Insulation for Mechanical Systems.” He is also active as a member of the ASTM Committee on Thermal Insulation (C-16). Crall can be reached at

Ronald L. King is a past president of the National Insulation Association (NIA), the World Insulation and Acoustic Organization, and the Southwest Insulation Contractors Association. He has been awarded the NIA President’s Award twice. King is a 40-year veteran of the commercial and industrial insulation industry, during which time he held executive management positions at an accessory manufacturer and a specialty insulation contractor. He recently retired as the chairman, CEO and president of a large national insulation distributor/fabricator and is currently a consultant and advisor. King can be contacted via e-mail at

One thought on “Maintaining Montana’s Mechanical Insulation: Energy appraisal of commercial buildings

  1. Anita Yadavalli

    Hi, I work with Indiana Legislative Services and would like to know the average cost of installing mechanical insulation. I understand this is difficult to estimate, but if you could provide some sort of range I’d appreciate it.


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