ClimateProtectionWithRapidPayback Online

Climate protection
with rapid payback

Energy and CO2 savings
potential of industrial
insulation in EU27
Ecofys study identifies a large energy efficiency
potential of industrial insulation
European Industrial Insulation Foundation Ecofys Netherlands BV
Avenue du Mont-Blanc 33 Kanaalweg 15-G

CH-1196 Gland, Switzerland NL-3256 KL Utrecht, The Netherlands
t: +41 22 99 500 70 t: +31 30 662 31 20

f: +41 22 99 500 71 f: +31 30 662 33 01
[email protected] [email protected]
www.eiif.org www.ecofys.com
Climate protection with rapid payback
Energy and emissions savings potential of industrial insulation in EU27
By: Maarten Neelis, Paul Blinde, Martijn Overgaag and Yvonne Deng
By order of: European Industrial Insulation Foundation
Date: 19 June 2012

Climate protection with rapid payback Summary
Executive summary
Background of the study

Current practice in industry is reported to lead to levels of insulation that are less than those
which would be cost-effective under current market conditions. This can result from the use of
design criteria based only on maximum safe surface temperature or based on generic heat loss
rates without consideration of the cost effective level.
It is also observed that in many cases thermal insulation in industry is poorly maintained and
parts remain uninsulated creating thermal bridges resulting in excessive heat losses. Poor insu-
lation not only leads to increased cost for energy and unnecessary emissions but also to higher
thermal stresses, which can accelerate wear and leading to more frequent breakdowns. Other
effects of poor insulation include reduced product quality and increased costs of maintenance.
In many cases, the loss of energy to work spaces that are climate controlled creates additional
burdens on cooling systems.
The industrial insulation industry is therefore convinced that there is a significant energy saving
and emissions mitigation potential related to improved thermal insulation in EU27 industry. This
potential is currently untapped despite being cost-effective to implement and offering the addi-
tional benefits mentioned above. Against this background, the European Industrial Insulation
Foundation (EiiF) commissioned Ecofys to study this potential.
Research questions and approach

This study aims to answer the following four questions:
1) What is the energy savings and CO2 emissions mitigation potential resulting from
insulating currently uninsulated parts and from better maintenance of insulation
systems?
2) What is the energy savings and CO2 mitigation potential from improving current
insulation to cost-effective levels? Cost-effective insulation in this study is defined
as the insulation that minimises the sum of the costs of heat loss and the costs of
insulation.
3) What is the energy savings and CO2 mitigation potential from improving current
insulation beyond cost-effective levels to even more energy-efficient levels?
Energy-efficient insulation in this study is defined as the insulation at which the
sum of the costs of heat loss and the annualised insulation investments are
equal to the costs of typical current insulation while offering an additional energy
savings and CO2 mitigation potential.
4) How can these potentials best be realised?
This study investigates savings potentials from improved insulation in EU industry and the
power sector under realistic market conditions. Nuclear power plants and power production
by renewable sources were left outside the scope of this study as well as insulations of cold
applications.
I
Summary
Case studies of insulation projects have been used to compare energy loss and investments
related to different levels of insulation. The analysis was performed for three temperature levels:
<100 °C; 100 – 300 °C and >300 °C. Results at the level of the case studies were extrapolated
to European level using data on current energy use. Other assumptions have been made where
needed on the basis of literature and expert input. All potentials are based on a 9% discount
1
rate, an average insulation lifetime of 15 years and a 2-3% per year increase of the price of
energy net of inflation.
Energy savings and CO emissions mitigation potentials

2
The saving potentials are shown in the figure and table below. A savings potential was found
to exist across all regions, sectors and equipment and operating temperatures. Potentials vary
between regions and sectors, due to differences in energy use, temperature profiles and fuel
mix. About two thirds of the energy and emission savings potential is in uninsulated or damaged
insulation. The remaining part of the potential would come from improving insulation on currently
insulated surfaces.
The results show that insulating all surfaces to cost-effective levels would avoid approximately
66% of current heat loss. This corresponds to about 620 PJ (~480 PJ for industry and ~140
PJ for fossil fuel-fired power plants). Improving insulation to energy-efficient levels would even
avoid approximately 75% of current heat loss. This corresponds to about 710 PJ (~550 PJ for
industry and ~160 PJ for fossil fuel-fired power plants). These saving potentials represent about
5% of industrial energy consumption and about 1% of energy input to fossil fuel-fired power
plants .
2
Table Total annual savings potential of improving thermal insulation up to cost-effective or energy
efficient levels in EU27
Annual cost - Annual energy -
effective savings efficient savings
potential potential
Energy savings potential 620 PJ 710 PJ
CO2 emissions reduction potential 49 Mt CO2 56 Mt CO2
Reduction of heat loss over surfaces -66% -75%
1
The group of experts that provided input to this study represented different insulation companies and most of
them are certified TIPCHECK engineers trained by EiiF in insulation energy appraisals (TIPCHECK = Technical
Insulation Performance Check). All experts within the group have extensive experience with insulation projects and
throughout their careers held different positions in the insulation industry.
2
Even though the energy savings potential for the power sector is substantial in absolute terms, compared to the
savings potential for industry, it is relatively low as share of total input. The reason for this is the nature of the power
generation which is an energy conversion process.
II
1,000
Heat loss over surface without
900 insulation and surface with damaged
insulation
800 Heat loss over insulated surface
Heat loss in PJ per year
700
600
500
400
-66%
300
-75%
200
100
0
C urrent typical insulation C ost-effective insulation Energy-efficienct insulation
practices levels levels
Figure Potential from improving current insulation and insulating surfaces without or with damaged insu-
lation; Reductions in heat loss assume insulation of the total surface of all equipment. In reality, a
small share of the total surface cannot be insulated due to technical restrictions.
How big is the potential?

The annual cost-effective potential is more than:
• The annual energy consumption of 10 million households

• The annual energy input to 15 coal-fired power plants with a production capacity
of 500 MW
• The annual industrial energy consumption of the Netherlands.
• The annual CO2 emissions of 18 million middle class cars each running 12,500
kilometres per year.
• The order of magnitude of the total savings potential from technical insulation
(~5% of industrial energy consumption and ~1% of energy input to fossil fuel-
fired power plants) shows that improving insulation can significantly contribute to
achieving EU’s 2020 climate and energy targets, known as the “20-20-20” targets:
-- A 20% reduction in primary energy use compared with projected levels, to be
achieved by improving energy efficiency.
-- A reduction in EU greenhouse gas emissions of at least 20% below 1990 levels
-- 20% of EU energy consumption to come from renewable resources
Investments in energy efficient insulations pay back

Improving insulation will not only save energy but also reduce costs. The figure below shows the
total costs of two different insulation solutions over a 15-year lifetime. The costs of the current
III
Summary
typical insulation solution (usually fulfilling process or safety requirements only) are taken as
reference.
Current typical Cost-effective

insulation insulation
11%
23%
Costs of heat
loss over
1st Qtr lifetime
2nd Qtr
58% Investments
19%
Cost savings
89% from reduced
heat loss
Figure Visualisation of cost savings from reduced heat loss due to the use of cost-effective insulation
The figure shows that although cost-effective insulation requires a higher initial investment,
because of cost savings from reduced energy loss, it will lead to lower costs over the total insu-
lation lifetime.
Costs for current typical insulation:
11% investment in insulation + 89% costs for energy due to heat loss = 100%
Costs for cost-effective insulation:
The cost-savings that can be achieved depend on characteristics of the specific application. As
a general rule, the achievable cost savings of improved insulation increase with longer operation
times and lifetimes.
Cost-effective or energy efficient industrial insulation will generate jobs

Apart from saving energy and costs, implementing cost-effective technical insulation on all
surfaces could save jobs and even increase employment by, roughly estimated, 4,000 people
EU-wide. All results were found to be consistent with expert opinions and figures found in
literature.
How to tap the potential?

1) Insulate uninsulated and damaged parts
This study shows that insulating uninsulated equipment and repairing damaged insulation
parts combines the biggest energy and emission cost-effective saving potential with payback
periods of less than one year. It is therefore recommended that industry focuses first on those
uninsulated and damaged parts which can be insulated quickly and easily and bring immediate
benefits.
IV
2) Evaluate cost-effectiveness and consider insulating today beyond today’s

cost-effective levels to be prepared for likely increasing costs for energy
and CO2 emissions
Most plants have an insulation system that meets safety rules and process needs or that leads
to a generic maximum heat loss rate. Such insulation systems typically have a lower perfor-
mance than what would be cost-effective. Compared to current practices, cost-effective insu-
lation will therefore in general save both heat and money. This study therefore recommends
evaluating cost-effectiveness in future insulation projects. Since insulating now saves money
in the future, the cost-effectiveness should be evaluated using expected future costs of energy.
Removal and replacement of current insulation is only attractive under some circumstances.
Replacing damaged insulation or insulating bare equipment is normally always cost-effective.
The savings potential of improving current insulation to cost-effective levels is therefore best
realised during general overhauls and installation of new equipment when new insulation needs
to be applied anyway.
Insulating beyond cost-effective levels is a way to partly mitigate the risk of increasing energy
prices and can help achieve company goals for energy efficiency and for greenhouse gas emis-
sions reduction. This study investigated the level of energy efficient insulation. This term stands
for insulation beyond the cost-effective level at which the sum of the costs of heat loss and the
annualised insulation investments are equal to the costs of typical current insulation. The level
of energy efficient insulation reduces heat loss sustainably at no additional overall costs but
requires higher initial investments than typical insulation.
According to experts, the present absence of cost-effective insulation is partly the result of
organisational barriers. To realise the potential of improved insulation, it is therefore recom-
mended that these barriers are identified and tackled where they exist.
3) Involve insulation experts early in the planning of new build and turn-
around projects to ensure thermal efficient and cost-effective insulation
systems:
Application of insulation material is quite often hampered by limitations in the space available,
for example between pipes with different temperatures. Although this can (partly) be solved
by using insulation materials with better insulating properties these would typically be more
expensive. This drawback can be minimised or even avoided by involving insulation engineers
early enough during the design phase of new equipment or retrofit projects.
V
Summary
VI
Climate protection with rapid payback Contents
Contents
1 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I
1 Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII
1 List of Figures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX
1 List of Tables. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XI
1 Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.1 Framework and goal of this study. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.2 Why insulate?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
1.3 Why is the potential still there?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
1.4 Approach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
1.5 Outline of this report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
2 Inputs to calculations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
2.1 Current insulation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
2.2 Current heat loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
2.2.1 Fuel-use related to each temperature-level. . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
2.2.2 Energy loss over surfaces . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.3 Investments in insulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
2.3.1 Total investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
2.3.2 Annualisation of investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.4 Costs of heat loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.4.1 Costs of fuel. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.4.2 Costs of greenhouse gas emissions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
3 Energy savings and CO2 emissions mitigation potentials . . . . . . . . . . . . . 30

3.1 Overview of different potentials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
3.2 The potential from insulating currently uninsulated parts and from better
maintenance of insulation systems. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
3.3 The potential from improving insulation of currently insulated surfaces. . . . . . . 34
VII
Contents
4 Investments and employment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

4.1 Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
4.2 Employment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
5 Conclusions and recommendations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

5.1 Size of the potential . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
5.2 How to tap the potential?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
6 Reference sources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
A Breakdown of potential by sector and region. . . . . . . . . . . . . . . . . . . . . . . . 46

A.1 Potential per sector. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
A.2 Potential per region . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
B Sensitivity analyses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
B.1 Missing and damaged insulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
B.2 Cost-effective insulation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
B.3 Energy-efficient insulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
C Best practice in industry. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

C.1 Chemical plant, France. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
C.2 Refinery tower, Italy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
C.3 Processing plant, Germany . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
C.4 Chemical plant, the Netherlands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
C.5 Machine room, the Netherlands. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
C.6 Refinery, Belgium. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
C.7 Processing line, The Netherlands. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
C.8 Condensation on uninsulated parts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
VIII
Climate protection with rapid payback List of Figures
List of Figures
Figure 1-1 Cost curve of insulation of a flat surface . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Figure 1-2 Overview of data sources and study results . . . . . . . . . . . . . . . . . . . . . . . 16
Figure 2-1 2007 fuel consumption by refineries and manufacturing industry . . . . . . . 20
Figure 2-2 Distribution of fuel input over surfaces with different temperature
levels in various industrial sectors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Figure 2-3 Current heat loss as share of fuel consumption in EU27. . . . . . . . . . . . . . 23
Figure 2-4 Current heat loss over surfaces in EU27. . . . . . . . . . . . . . . . . . . . . . . . . . 23
Figure 2-5 Typical required investments in insulation as function of insulation
thickness for a pipe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Figure 2-6 Required insulation thickness for different heat loss rates. . . . . . . . . . . . . 25
Figure 3-1 Potential from improving current insulation and insulating surfaces
without or with damaged insulation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Figure 3-2 Potential in the EU from insulating currently non-insulated and
repairing damaged insulation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Figure 3-3 Comparison of heat loss rates resulting from cost-effective insulation
and typical current insulation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Figure 3-4 Comparison of heat loss rates resulting from energy-efficient
insulation and typical current insulation. . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Figure 3-5 Heat loss at current, cost-effective and energy-efficient level of
insulation in EU27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Figure 4-1 Investments required for improving insulation to cost-effective and
energy-efficient levels and corresponding annual savings from
reduced heat loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Figure 4-2 Visualisation of cost savings from reduced heat loss for an average
insulated surface. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Figure A-1 Annual energy and emissions savings potential per sector. . . . . . . . . . . . 46
Figure A-2 Regional division of EU27 for the purpose of this study . . . . . . . . . . . . . . 47
Figure A-3 Annual energy and emissions savings potential per region. . . . . . . . . . . . 47
Figure C-1 Regular and thermographic photo of a boiler window. . . . . . . . . . . . . . . . 50
Figure C-2 Regular and thermographic photo of an uninsulated valve. . . . . . . . . . . . 51
Figure C-3 Thermographic photo of a tank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Figure C-4 Regular and thermographic photo showing dangerously high-
temperature surfaces. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Figure C-5 Regular and thermographic photo showing high-temperature surfaces . . 54
Figure C-6 Regular and thermographic photo showing high-temperature surfaces . . 55
Figure C-7 Regular and thermographic photo showing dangerously high-
temperature surfaces. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
IX
List of Figures
Figure C-8 Pump breaks down . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

Figure C-9 Valve can no longer be operated. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Figure C-10 Extensive ice building on pipes and valves. . . . . . . . . . . . . . . . . . . . . . . . 57
Figure C-11 Broken vapour barriers and insufficient insulation. . . . . . . . . . . . . . . . . . . 58
X
Climate protection with rapid payback List of Tables
List of Tables
Table 2-1 Assumptions for current rates of heat loss at different temperature levels.20
Table 2-2 Current heat loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Table 2-3 Assumptions for the calculation of annual capital costs . . . . . . . . . . . . . . 26
Table 2-4 2010 price of main fuel types. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Table 3-1 Potential from improving current insulation and insulating surfaces
without or with damaged insulation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Table 3-2 Fuel savings from measures that involve applying insulation to bare
surfaces or repairing insulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Table 3-3 Fuel savings from measures that involve improving insulation to
optimum levels. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Table 4-1 Investments required for improving insulation to cost-effective and
energy-efficient levels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Table B-1 Savings potentials for different shares of surfaces without or with
damaged insulation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Table B-2 Cost-effective rate of heat loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Table B-3 Rate of heat loss at energy-insulation levels and corresponding
savings potential . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
XI
List of Tables
XII
Climate protection with rapid payback 1 Introduction
1 Introduction
1.1 Framework and goal of this study

In 2007, EU leaders endorsed a set of ambitious climate and energy targets to be met by the
year 2020. These EU ambitions are known as the 20-20-20 targets:
• A 20% reduction in primary energy use compared with projected levels, to be

achieved by improving energy efficiency.
• A reduction in EU greenhouse gas emissions of at least 20% below 1990 levels
• 20% of EU energy consumption to come from renewable resources
In this policy context, there is significant attention on measures that reduce energy demand and
mitigate CO2 emissions in all sectors of the economy such as the built environment, transport
and industry.
From their experience, the European industrial insulation Foundation (EiiF) is convinced that
there is a significant energy saving and CO2 mitigation potential related to improved thermal
insulation in industry and that this potential is currently untapped despite being cost-effective to
implement. With energy and CO2 prices likely to rise, this potential is probably growing. Against
this background, EiiF commissioned Ecofys to answer the following three questions:
1) What is the energy savings and CO2 mitigation potential resulting from better
maintenance of insulation systems and from insulating currently uninsulated
parts?
2) What is the energy savings and CO2 mitigation potential resulting from cost-
effective thermal insulation in the power sector and industry?
3) What is the technical potential available beyond current cost-effective insulation?
The potentials assessed in this study would on average be profitable under real market condi-
tions for industrial sectors and fossil-fuel power generation. Together these sectors constitute
around 35% of Europe’s primary energy use (based IEA, 2010). Fossil-fuel fired power gen-
eration covers both electricity only and combined heat and power (CHP) plants. These plants
account for 56% of total power generation in EU 27. The remainder is generated by nuclear
power plants (28%) and renewable sources (16%). Neither of these last two is covered by this
study as they do not give rise to greenhouse gas emissions.
Insulations of cold applications also fall outside the scope of this study as the majority of indus-
trial processes take place in hot applications (in industry cold insulations have a market share
of about 5%). Furthermore the effects of inadequate cold insulation are better detectable (con-
densation formation most often followed by ice building) so that e.g. uninsulated parts in cold
processes are less to be found. Nevertheless, wherever and whenever cold systems are not
insulated properly: insulation is e.g. insufficiently dimensioned, damaged or not maintained
consequently; they cause, besides large energy losses, also immediate condensation problems.
(For more information, please see info box about special requirements for cold applications in
chapter 1.4).
13 / 58
1 Introduction
1.2 Why insulate?

In both the power sector and industry, fuel is burned to generate heat (in furnaces, steam boilers
etc.) that is used in a variety of process units. The larger the share of heat that is used produc-
tively, the higher the efficiency of a process. To reduce heat loss, thermal insulation is therefore
applied to boilers and ovens, pipes, tanks and vessels and other equipment. This allows an
efficiency gain that reduces the energy use per unit of output and of the associated greenhouse
gas emissions and those of other pollutants such as CO, NOx and SOx.
In many cases, insulation also plays an important role in providing functions such as personal
protection, process control, product stabilisation, freeze protection, noise control and fire pro-
tection (Barnett, 2003). Poor insulation not only leads to increased costs for energy, but also to
higher thermal stresses, which can accelerate wear and subsequently lead to more frequent
breakdowns. Other effects of poor insulation can include reduced product quality, increased
costs of maintenance (U.S. DOE, 2007) and additional burdens on air conditioning, wherever
excess heat is lost to work spaces (U.S. DOE, 2007).
1.3 Why is the potential still there?

Industrial insulation experts1 observe that in many cases, thermal insulation in industry is
poorly maintained and that some parts remain uninsulated creating thermal bridges resulting in
excessive heat losses. They also note that the level of insulation applied is typically based on
requirements regarding the maximum surface temperature that equipment is allowed to reach to
avoid personal injuries or based on generic maximum heat loss rates allowed. It is very rare that
industrial companies require that the insulation system is designed based on criteria of cost-
effectiveness over the lifetime of the insulated piece of equipment. In the past, when fuel prices
were lower this would in many cases not have led to a large difference. Nowadays, the price
of energy is higher and is expected to grow even further. As a result there is an increasing gap
between current and cost-effective insulation levels. Additional costs for CO2 emission allow-
ances will accelerate this trend.
According to expert experiences, there are usually several reasons for companies not to
make detailed assessments of the cost-effectiveness of insulation and not to maintain existing
insulation:
There may be a general lack of information for the main decision makers about the large energy
savings potential of industrial insulation
• Insulation is a relatively small part of investments. Even though poor insulation

leads to higher costs of heat loss over many years, it is often seen as less important.
• Retrofitting insulation can, or can be perceived to, cause disruption in production.
• In common with other energy efficiency measures, it is not the core business of the
main decision makers.
1
The group of experts that provided input to this study represented different insulation companies and most of
them are certified TIPCHECK engineers trained by EiiF in insulation energy appraisals (TIPCHECK = Technical
Insulation Performance Check). All experts within the group have extensive experience with insulation projects and
throughout their careers held different positions in the insulation industry.
14 / 58
• There may be a lack of information about improvements in insulation materials

and in the design of modern insulation systems
• Split or unclear responsibility for decisions on maintenance.
1.4 Approach
The total costs of insulation are the sum of annualised investments and the annual costs of heat
loss. As the degree of insulation increases, the investment costs increase and the cost of the
heat loss decrease. As schematically shown in Figure 1 - 1, a minimum exists (point B) where
total costs are lowest1. Throughout this report, this level is referred to as the cost-effective
level of insulation.
Figure 1 - 1 shows that further potential exists beyond cost-effective insulation levels. Beyond
cost-effective level, heat loss is reduced even further at little additional cost. A point (point C)
can be defined where the total costs per year are equal to the costs of current insulation but
where insulation quality is significantly better. Throughout this report, this level is referred to as
the energy-efficient level of insulation.
Costs of insulation
Costs of heat loss

Costs per year
Total costs
Current Energy-efficient
(A) (C)
Cost-effective
(B)
Insulation thickness
Figure 1-1 Cost curve of insulation of a flat surface
The best insulation solution varies from application to application depending on many design
factors such as for example the shape and temperature of the surface that is insulated, sensi-
tivity to corrosion or the need for fire-proof materials. However, the main driver of differences
in heat loss rates is the difference in temperature between a surface and its surroundings. As it
would be impossible to account for all different aspects in a study such as this, this study con-
centrates on an analysis for three temperature levels for each sector:
• Low-temperature (ambient temperature – 100 °C)

2
• Middle-temperature (100 – 300 °C)

• High-temperature (>300 °C)
1
At this point the Net Present Value of the project is highest.
2
This study does not focus on cold insulation where the temperature of equipment is lower than ambient
temperature; see Box 1)
15 / 58
1 Introduction
Figure 1 - 2 gives a schematic overview of the data sources used. Relations between invest-
ments in insulation (Euro), the ratio between heat loss to current heat loss (-) and the rate of
heat loss (W/m2)1 have been obtained from case studies: a coal-fired power plant for high-
temperature surfaces, part of a chemical plant for middle-temperature surfaces and part of a
brewery for low-temperature surfaces. More background on the case studies used in this study
is provided by Box 2.
The fuel mix for each sector was obtained from energy statistics (IEA, 2009). Current and future
fuel prices were based on a forecasting study of the European Commission (EC, 2009b). This
study accounts for the effect of climate change policies by assuming costs of 15 Euro/tCO2.
Prices of energy are assumed to increase by 2-3% per year net of inflation.
Heat loss, investments and savings have been extrapolated to European level using data on
current energy use from energy statistics and assumptions for current insulation levels and heat
loss on the basis of literature and expert judgements. IPCC emission factors have been used to
express savings in terms of greenhouse gas emissions reduction. All potentials are based on a
9% discount rate and an average insulation lifetime of 15 years.
Input Output
Insulation projects Potential from insulating un-insulated

equipment and repairing damaged
insulation
Energy statistics
Cost-effective levels of thermal
insulation and resulting potential
Literature survey
Further potential beyond cost-effective

Expert opinions levels
Figure 1-2 Overview of data sources and study results
Overall, results are based on the best data available to the authors at the time that the study
was performed. Not enough data about insulation projects was available to allow robust sta-
tistical analyses. This study therefore relies on expert assumptions and secondary data from a
variety of sources.
1 2
The relation between heat loss (TJ /year) and rate of heat loss (W/m ) is not straightforward since the rate of
2
heat loss (W/m ) has area in the denominator and for non-plane surfaces such as cylinders (pipes), spheres etc.,
the surface area increases with increasing insulation thickness.
16 / 58
Box 1 Special requirements for cold applications (temperatures below ambient tem-
perature) (EiiF, 2012)
The FESI Technical Lexicon defines “Cold insulation” as follows: “Assembly of components
which reduces heat gain of the cold medium.” In principle, experts talk of “cold insulation”
wherever the medium temperature is below the temperature of the ambient air. The tem-
perature range of “cold insulation” is therefore between -273 °C and ambient temperature.
Insulations of cold applications fall outside the scope of this study because of their modest
market share (~5%) and due to their special requirements. This does not mean that there
is no energy savings potential in the “cold” temperature range below ambient temperature:
The main duty of all insulation systems, and therefore also of cold insulation is the reduction
of heat flow rates. With hot insulation, the heat flow rate is from the object towards the
ambient air, with cold insulations it is the other way around: from the ambient air to the
object. Compared with hot insulation systems cold insulation systems have however more
and further requirements to fulfil than limiting heat loss or respectively heat gain: cold insu-
lations always need to avoid the danger of moisture entering the insulation material. This
moisture results from condensation of water vapour out of the ambient air, whenever the
temperature at the object or inside the insulation material is below the dew point. Water
vapour will be transported into the insulation by differences in the overall pressure (air
movement) and through differences in the partial water vapour pressure (water vapour dif-
fusion) between the ambient air and the object to be insulated. Therefore it is first of all the
minimisation of moisture in the insulation which determines the design of a cold insulation
system. If this danger is not prevented, immediately water and/or ice form at those parts
of the insulation system where the temperature is below the dew-point temperature or the
freezing point of water. Whereas the heat “just escapes” from poorly or not insulated hot
insulation systems the consequences of ineffective cold insulation systems (below dew-
point temperatures) cause, besides great energy losses, immediately negative effects on
the industrial process:
• In the insulation material, they reduce the insulating effect considerably. The
thermal conductivity of water is 20 times that of air, the thermal conductivity of ice
is 100 times that of air. Extensive heat gain of the cold medium is the consequence.
• Water can cause corrosion on insulated installations and on the inner surface of
the cladding which could lead to material failure and cause severe accidents like
bursting pipes.
• Water and ice increase the weight of the insulated system. Cold piping can col-
lapse under this additional load.
Cold insulations have, in general, a limited life expectancy: They are unstable systems,
which for physical reasons react sensitively to damages. They must be maintained regu-
larly, which includes a routine check of sealings and interruptions. This is needed not only
to save decent volumes of energy but also to keep industrial processes running.
17 / 58
1 Introduction
Box 2 Case studies
This study uses, amongst others, the data from five insulation projects. For each of these
projects, the investments (Euro), heat loss (TJ/year) and insulation thickness (mm) was
available for a wide range of heat loss rates (W/m ). Consistent data for the price of insu-
2
lation material and installation were used for all projects. Trends observed from the projects
in heat loss, heat loss rate and insulation thickness are the result of laws of physics and
will be valid for typical cases observed in practice. Exact quantitative relations will however
vary from application to application. The relations found for the used case studies are by
insulation experts believed to be within the range of what is typically observed and not to
represent extremes. To allow for comparison, all case studies were normalised with respect
to annual operation time (90% utilization rate) and surface area:
• 1 GW coal-fired power plant: this case study predominantly involves temperatures

between 300 °C and 500 °C although the complete power plant has been consid-
ered including all piping, vessels, channels and plane surfaces, an e-precipitator
and a flue gas desulphurisation plant.
• Part of a chemical plant: the project involved a set of pipes with an average tem-
perature of approximately 200 °C
• Part of a methane compressor station with a throughput of 55,000 Nm3/h and a
pressure increase from 35 to 200 bar; the project involved a set of pipes with a
total length of approximately 200 m and an average temperature of 150 °C.
• Part of a brewery with a capacity of 3,500,000 hl; the project involved the insula-
tion of two lauter tuns (vessel used in the brewing process to separate out wort)
and related pipelines with a temperature of 84 °C.
• Part of an atmospheric distillation unit at a refinery. The unit has a capacity of
143,396 barrels/day and a maximum thermal input rate of 130 MW. The insula-
tion project involved approximately 1,100 m2 of the tower wall. The surrounding
equipment (furnace, heat exchangers, pipelines, other small surrounding towers)
consists of around 40,000 m2 of already insulated surface.
1.5 Outline of this report

The structure of this report is as follows:
• Chapter 2 discusses the project approach and assumptions.

• Chapter 3 shows the energy savings and CO2 emissions mitigation potentials from
improved insulation. The breakdown of these potential by sector and region is
shown in Appendix A. Appendix B describes a number of examples of insulation
projects. The potentials were tested on their sensitivity to a number of key assump-
tions. The results of this sensitivity analysis are shown in Appendix C.
• Chapter 4 discusses the investments required and the effects on employment.
• Finally, chapter 7 gives the main conclusions and recommendations
18 / 58
Climate protection with rapid payback 2 Inputs to calculations
2 Inputs to calculations
The general approach to determine savings potentials is described in the introduction. This
chapter describes how the inputs to that approach were obtained: current insulation (section
2.1), current heat loss (section 2.2) and the relation between the rate of heat loss per square
meter on the one hand and investments in insulation (section 2.3) and total heat loss (section
2.4) on the other hand.
2.1 Current insulation

The company which uses insulation typically defines to what level its equipment is insulated.
According to industry experts, most plants are operated with an insulation system specified to
meet safety rules, process needs or a generic maximum heat loss rate. Specifications asking for
an economic insulation system are an exception (EiiF, 2010a; EiiF, 2010b, EiiF, 2010c)
Insulation performance is usually specified as a typical heat loss rate per unit of surface area
(W/m ) insulated. A lower heat loss rate corresponds to a higher degree of insulation. A current
2
heat loss rate of 150 W/m2 can be inferred from a study to technical information from KAEFER
(KAEFER, 2010), expert input (EiiF, 2010b), standards specifications of six companies (four in
the power sector, one in the brewery sector and a provider of boiler systems) (EiiF, 2010c). This
value is used for high- and middle-temperature applications. As heat losses are driven by tem-
perature differences, low-temperature surfaces typically have lower rates of heat loss. In this
study a heat loss rate of 100 W/m2 for low-temperature applications is assumed. Sectors and
regions have different temperature profiles and the distinction of heat loss rates by temperature
levels also leads to differences in the average heat loss rate between sectors and regions.
In reality, the average heat loss at a given temperature level varies from sector to sector and
from region to region. It was not possible within the scope of this study to account for such
variations as even within sectors there are significant differences in insulation performance (EiiF,
2010a; EiiF, 2010b).
The heat loss rates discussed above refer to insulated surfaces. Not all surfaces are however
insulated. The company website of Hertel (2011), a global company, states that in a typical
plant 10-19% of insulation is damaged or missing. For U.S. industry, King (2010) estimates that
10-30% of all exposed mechanical insulation becomes damaged or missing within 1 to 3 years
of installation. Lettich (2003) presents two typical case studies of U.S. plants, a chemical plant
and a refinery, in which about 20% of all insulation is damaged. For the EU, where insulation
performance is typically better, NCTI estimates that on average 5-10% of all surfaces is badly
insulated (EiiF, 2011). Based on the information above and additional expert judgements, the
share of equipment without insulation or with damaged insulation is conservatively estimated to
be 10%, 6% and 2% for low-, middle- and high-temperature surfaces respectively.
The heat loss over surfaces without or with damaged insulation is predominantly dependent
on surface temperature and the remaining degree of insulation (for damaged insulation). Esti-
mates are made based on calculations of heat loss rates in accordance with guidelines from the
Association of German Engineers (VDI, 2008). As a general rule, the heat loss from a hot, bare
surface can be as much as 20 times greater than from a surface insulated to current industry
standards (Hart, 2003). Calculations by experts show that for high-temperature surfaces, heat
loss rates can be even higher depending on the temperature.
19 / 58
Table 2 - 1 provides an overview of assumptions with respect to the status of current insulation.
Table 2-1 Assumptions for current rates of heat loss at different temperature levels, based on expert input
(EiiF, 2010b, 2010c; KAEFER, 2010); heat loss rate over poorly or uninsulated surfaces (based
on calculations); share of equipment that is currently not insulated (Hertel, 2011; Lettich, 2003;
King, 2010 and additional expert judgements)
Average rate of Average share

Average current
heat loss over of equipment
rate of heat loss
Type of application surfaces without without or
over insulated
2 or with damaged with damaged
surfaces in W/m 2
insulation in W/m insulation
Low-temperature applications
100 1,000 10%
(<100 °C)
Middle-temperature
150 3,000 6%
applications (100 - 300 °C)
High-temperature applications
150 10,000 2%
(>300 °C)
2.2 Current heat loss

To calculate the current heat loss, the fuel input to each sector is first related to the different
temperature levels (section 2.2.1). In a second step, a percentage of that fuel input is assumed
to be lost over insulated surfaces (section 2.2.2).
2.2.1 Fuel-use related to each temperature-level

Figure 2 - 1 shows the 2007 fuel consumption of refineries and manufacturing industry, 10,673
PJ in total. In addition to this fossil fuel-fired power generation used 17,004 PJ.
Petroleum refineries
Iron and steel
Chemical and petrochemical

Non-ferrous metals
Non-metallic minerals
Transport equipment
Machinery
Mining and quarrying
Food and tobacco

Paper, pulp and print
Wood and wood products

Construction
Textile and leather
Non-specified (industry)
0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000
Fuel consumption in PJ / year
Figure 2-1 2007 fuel consumption by refineries and manufacturing industry (IEA energy statistics); The depicted
fuel consumption is net of any fuel used in conversion processes from one energy carrier to another
(e.g. crude oil to petroleum products in refineries, coal to cokes and cokes to blast furnace gas in
the iron and steel industry).
20 / 58
For each sector considered, the fuel use is distributed over low-, middle- and high-temperature
applications in terms of shares of surface area (see Figure 2 - 2) (based on ECN (2002), FfE
(2007), FfE (2009) and EC (2009)). This distribution takes into account that due to cascading of
energy use, high-temperature processes (e.g. power generation) also involve low temperature
surfaces. The figure shows that some sectors predominately involve high-temperature surfaces
whereas others predominately involve only low-temperature surfaces.
The fuel inputs from Figure 2 - 1 were combined with the temperature profiles from Figure 2 - 2
to obtain the fuel input for each sector associated with each temperature level.
Fossil fuel-fired power generation

Petroleum refineries
Iron and steel
Chemical and petrochemical
Non-ferrous metals
Non-metallic minerals
Transport equipment
Machinery
Mining and quarrying
Food and tobacco
Paper, pulp and print
Wood and wood products
Construction
Textile and leather
Non-specified industry
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Low-temp. surfaces (< 100 °C ) Middle-temp. surfaces (100 - 300 °C ) High-temp. surfaces (> 300 °C )
Figure 2-2 Distribution of fuel input over surfaces with different temperature levels in various industrial sectors
based on ECN (2002), FfE (2007), FfE (2009) and EC (2009)
2.2.2 Energy loss over surfaces

The amount of heat that is lost over surfaces normally only represents a small fraction of the
energy input to a process. A share of energy input is converted into useable work driving the
conversion of raw materials or intermediates into final products. Energy that is not converted to
useable work or services can be considered to be lost. Not all losses take place due to heat loss
over surfaces that could be insulated (the following is based on U.S. DOE-ITP, 2004):
• Losses occur in energy conversion systems (e.g., power generation, boilers, heat
exchangers, process heaters, pumps, motors) where efficiencies are thermally or
mechanically limited by materials of construction and equipment design other than
insulation.
• In some cases, heat-generating processes are not located optimally near heat
sinks, and it may be economically impractical to recover the excess energy.
• Energy is sometimes lost simply because it cannot be stored.
• Energy is also lost from processes when waste heat is not recovered and when
waste by-products with fuel value are not utilised.
21 / 58
• Energy may leave the process with the product, cooling water, flue or exhaust gas
Of the energy that is lost over surfaces, the actual loss depends on the specific application.
Pipes with a large diameter for example have less heat loss expressed per unit of energy
throughput as compared to those with a smaller diameter. In lower temperature processes,
energy is consumed mainly via smaller, insulated, steam or hot water based equipment, where
losses over the surface area represent a more significant fraction of the energy used.
One of the case studies considered in this study, the coal-fired power plant (see Box 2: case
studies), predominantly involves high-temperature surfaces. At a currently typical heat loss rate
of 150 W/m2, this plant would have a heat loss that represents about 0.5% of total energy input.
Another case study, the crude distillation tower predominantly involves middle-temperature sur-
faces. At a currently typical heat loss rate of 150 W/m2, this tower has a heat loss representing
about 6% of total energy input.
Based on these case studies and additional expert judgements, the energy loss over insulated
surfaces in fossil fuel-fired power generation is assumed to be 0.5% of energy input. For low,
middle, and high-temperature equipment in industry, the heat loss over insulated surfaces is
assumed to be 6%, 4% and 2% of energy input, respectively. These shares represent the heat
1
loss in case all surfaces would be insulated up to typical levels. Since a share of the surfaces is
currently not insulated, the heat loss over currently insulated surfaces is somewhat lower.
Table 2 - 2, Figure 2 - 3 and Figure 2 - 4 show the current heat loss calculated by combining
the shares of heat loss (see above), the current fuel input per temperature level (see section
2.2.1) and the assumptions regarding current insulation (see section 2.1). Results show that for
the power sector the absolute heat loss is substantial. Even so, the percentage of heat loss as
share of total input is relatively low.
Table 2-2 Current heat loss
Share of energy Share of energy

Total share
that is lost that is lost over
of energy use
Type of application over currently surfaces without
input that is
insulated or with damaged
currently lost
surfaces insulation
Fossil fuel-fired power generation 1.2% 0.5% 0.7%
Industry
Low-temperature surfaces 9.6% 5.4% 4.2%
(<100 °C)
Middle-temperature surfaces 6.7% 3.8% 2.9%
(100 – 300 °C)
High-temperature surfaces 5.0% 2.0% 3.1%
(>300 °C)
1 2
At equal insulation performance in terms of heat loss rate (W/m ), the heat loss as percentage of energy input
is lower for equipment with higher temperatures, since the energy within such equipment is higher. In addition, the
size of higher temperature equipment on average is larger leading to less heat flow over exterior surface per unit
of volume. On top of that, the time that a heat medium remains in higher temperature equipment on average is
shorter, allowing less time for the medium’s heat content to flow over exterior surface.
22 / 58
10%
9% insulation and over surface with
Energy loss as share of fuel consumption damaged insulation
Heat loss over insulated surface
8%
7%
6%
5%
4%
3%
2%
1%
0%
Fossil fuel fired Industry low- Industry middle- Industry high-
power generation temp. surfaces temp. surfaces temp. surfaces (>
(< 100 °C) (100 - 300 °C) 300 °C)
Figure 2-3 Current heat loss as share of fuel consumption in EU27
400

350 insulation and over surface with
damaged insulation
Heat loss over insulated surface

300
Energy loss in PJ per year
250
200
150
100
50
0
Fossil fuel fired Industry low- Industry middle- Industry high-
power generation temp. surfaces temp. surfaces temp. surfaces
(< 100 °C) (100 - 300 °C) (> 300 °C)
Figure 2-4 Current heat loss over surfaces in EU27
The shares in Table 2 - 2 seem conservative compared to assumptions made by the U.S.
Department of Energy (DOE-ITP, 2010) in an energy analysis of U.S. industry. That analysis
assumes that energy losses incurred during distribution of steam within the plant boundaries
amount to 20% of steam production. Losses during process heating due to radiation, con-
vection, insulation, and cooling are estimated to be 15%. Both types of losses include losses
due to missing or damaged insulation.
23 / 58
2.3 Investments in insulation

The annualised investments in insulation over the insulation lifetime are obtained by annualising
(section 2.3.2) total investments required to limit heat loss to a certain level (section 2.3.1).
2.3.1 Total investments

Investments in insulation include material costs and installation costs. Material costs include the
costs of both insulation material and cladding. The costs of maintenance are not considered in
this study.
Figure 2 - 5 shows the typical relation between overall investments and insulation thickness for
a pipe. Thicker insulation requires more material (See Box 3 for the relation between insulation
thickness and heat loss). Material costs therefore scale with the thickness of the insulation.
Costs related to the installation and cladding material are considered to be fixed; each time
however that a new layer of insulation material is required, additional effort needs to be made,
resulting in a small step in installation costs.
2
Costs of insulation per m
Insulation thic kness
Figure 2-5 Typical required investments in insulation as function of insulation thickness for a pipe
In this study, relations between the costs of insulation (Euro) and the rate of heat loss (W/m2)
are obtained from case studies (see Box 2: Case studies): a coal-fired power plant for high-
temperature surfaces, part of a chemical plant for middle-temperature surfaces and part of a
brewery for low-temperature surfaces.
24 / 58
Box 3 Relation between insulation thickness and heat loss
The insulation thickness required to attain a certain heat loss rate (expressed as W/m
2
of surface area) is a function of the properties of the insulation material, the shape of the
insulated surface, the temperature difference over the insulation layer and the wind speed
in the surrounding environment.
The figure below shows the insulation thickness as a function of heat loss rate for case
studies prepared by EiiF experts and for various heat pipes with different temperatures and
diameters. For the considered applications, the effects of differences in insulation material
used and wind speeds are small compared to the effects of temperature differences and
shape.
Figure 2-6 Required insulation thickness for different heat loss rates
The figure shows that lower heat loss rates require thicker insulation. In addition, the figure
shows that higher temperatures require thicker insulation to reach the same heat loss
rate. For the pipes, the figure also shows that the required thickness depends on the pipe
diameter. This dependence is a result of the fact that for convex surfaces, such as pipes,
the surface area increases with increasing insulation thicknesses.
2.3.2 Annualisation of investments

Installing insulation now saves money in the future. From an investor’s point of view it is
however impossible to simply add and subtract investments and savings if they occur at dif-
ferent points in time. Investors have a time preference. They would rather have cash imme-
diately than in the future. Like most things that lie ahead in time, future savings are moreover
25 / 58
uncertain. This problem is solved in this study by discounting future savings1. Table 2 - 3 pro-
vides an overview of the assumed discount rate and insulation lifetime.
Table 2-3 Assumptions for the calculation of annual capital costs
Parameter Value
Discount rate 9%
Lifetime of insulation 15 years
Insulation lifetime varies from one application to the other. Obviously, longer lifetimes increase
the profitability of investments in insulation. Based on expert judgments the average lifetime of
insulation is estimated to be 15 years; a figure that is supported by Hertel (2011). Insulation of
20 years and older is however also observed in practice. Such insulation generally involves out-
dated types of materials and therefore should normally be replaced as soon as possible to avoid
excessive heat losses.
The discount rate reflects the time preference and risk premium for the investor. When an
investor rather receives 100 Euro now then 108 Euro a year from now, then he is said to have
a discount rate of 8%. The actual discount rate is the sum of the real discount rate plus the
expected rate of inflation. The effects of inflation are excluded from this study by using the real
discount rate and expressing all investments, costs and savings in constant 2010 Euros.
The choice of real discount rate depends on the purpose of the analysis. When investigating the
potential that is economically attractive from a social perspective, typically a real discount rate
of 3 - 5% is used for energy saving investments. When investigating the part of the technical
potential that is economically attractive from the point of view of private investors, discount rates
of 8-15% or higher can be used to reflect real market conditions (EC, 2009b; Blok 2007; U.S.
EPA, 2008). Based on a company survey, Oxera (2009) reports real discount rates of 6 - 9% for
low-risk conventional power generation and discount rates of up to 16% for riskier technologies.
The PRIMES model used for the official EU projections assumes a real discount of 12% for
industry.
A company often bases its hurdle rate (the minimum expected return a company will consider in
accepting investment opportunities or action proposals) on its weighted average cost of capital
(WACC). Typical WACCs are in the order of 8-10% (Acca, 2006; U.S. EPA, 2008; Damodaran,
2011 and WikiWealth, 2011). Many companies were however found to use hurdle rates that are
3 - 5% higher than their cost of capital (Poterba and Summers, 1995; Meier and Tarhan, 2007).
It is worth mentioning here that a firm-wide discount rate would be expected to result in underin-
vestment in low-risk projects whose expected returns would not meet the company-wide hurdle
rate (Oxera, 2011).
Based on the above, a real discount rate of 9% is used which is at the lower bound of typical
private discount rates but well above typical social discount rates. The sensitivity to this choice
is tested by evaluating heat loss reductions for cost-effective insulation at discount rates of 3%
and 15% as well (see Appendix B).
1
This is equivalent to annualising investments by an annuity factor (α) which is a function of insulation lifetime (n)
and discount rate (r):

26 / 58
Box 4 Implicit discount rates
Assuming that companies will implement economically attractive energy efficiency mea-
sures, a discount rate can be inferred by looking at what energy efficiency measures are
implemented and what not. In other words: the capital costs and (expected) costs savings
of implemented and unimplemented projects imply discount rates used by companies.
These implicit discount rates typically however significantly exceed market discount rates
used by companies. For example, current insulation practices as assumed by this study
imply discount rates in the range of 30 - 40%, which is much higher than typical marktet
rates used by companies.
Discrepancies between implicit and market discount rates have initiated debates about
the effectiveness of the market. One view is that the market currently works efficiently
and that the high implicit discount rates must reflect the perceived risk of efficiency invest-
ments - an explanation consistent with the hypothesis of efficiently structured markets.
On the other hand, technology analysts claim that the high implicit discount rates are the
effect of ‘market barriers’ preventing adoption of cost-effective energy-saving technologies
(Howarth and Sanstad, 1995; Newell et al., 2006; Jaffe et al. 2004).
This study does not intend to make statements about economic theories and practice.
Section 1.3 does however describe some typically observed behaviour that could lead to
under-investments and unnecessary heat loss.
2.4 Costs of heat loss

The costs of heat loss are calculated by multiplying heat loss by a price of heat. The heat loss at
each level of insulation is determined by multiplying the current heat loss by the ratio between
the heat loss at that level of insulation and the current heat loss (-). The relation between this
ratio and the rate of heat loss (W/m2) is obtained from case studies (see Box 2: Case studies): a
coal-fired power plant for high-temperature surfaces, part of a chemical plant for middle-temper-
ature surfaces and part of a brewery for low-temperature surfaces.
The price of heat is determined for each sector as the sum of the costs of the fuels used to gen-
erate heat and the resulting CO2 costs. The same price per GJ is used for low-temperature heat
and high-temperature heat. The heat price in this study does not include other costs related
to the heat generating equipment: investments and costs of operation. These costs amount to
approximately 6 Euro/GJ (EiiF, 2011), but are not necessarily avoided through better insulation
(see Box 5). Including them in the price of heat would however significantly increase the savings
potentials of insulation (see Appendix B).
2.4.1 Costs of fuel

The fuel mix for each sector was obtained from energy statistics (IEA, 2009). Current and future
fuel prices were based on a forecasting study of the European Commission (EC, 2009b). Prices
of energy exclude effects of taxes and subsidies. Coal, gas and oil prices are assumed to
increase by 3%, 2.5%, and 2% per year net of inflation. Baseline fuel prices are shown in Table
27 / 58
2 - 4. To show the effect of accounting for price increases over time, Appendix B shows the cal-
culated potentials at constant fuel and carbon prices.
2.4.2 Costs of greenhouse gas emissions

CO2 emissions from the combustion of fuels were determined using emission factors according
to the IPCC Good Practice Guidance (2006). In Europe, larger industrial installations and power
generators are part of the EU emissions trading system (EU ETS). Installations in that system
need to balance their CO2 emissions by emission allowances. Smaller industrial installations,
that are not part of the EU ETS, are likely to be faced with alternative climate policies such as
carbon taxation also imposing costs on CO2 emissions.
This study accounts for the effect of climate change policies by assuming costs of 15 Euro/
tCO2 gradually increasing with 2% per year to 20 Euro/tCO2 in 2025. Table 2 - 4 shows the effect
of these costs by including them in the price of fuel. The table demonstrates that the carbon
related costs per unit of energy are higher for emission-intensive fuels such as coal (~96 tCO2/
TJ) and oil products (~73 tCO2/TJ) than for natural gas (~56 tCO2/TJ).
1
To show the effect of accounting for price increases over time, Appendix B shows the calculated
potentials at constant fuel and carbon prices.
Table 2-4 2010 price of main fuel types (calculated from EC, 2009a using net heating values, average
inflation and exchange rate to convert 2008 USD to 2010 Euro)
3
1,2 2010 price excl. costs of carbon 2010 price incl. costs of carbon
Fuel type
in Euro/GJ in Euro/GJ
Coal 2.57 4.01
Natural gas 6.42 7.26
Oil and oil products 10.21 11.31
1
The price of renewable fuels, which represent a relatively small part of the total energy supply, was conserva-
tively estimated at 10 Euro/GJ and kept constant throughout time.
2
The price of purchased heat was taken as the average of the price of gas and coal.
3
In the calculation the cost of carbon was evaluated at a more detailed classification of fuels than the three fuels
shown here.
1
IPCC Good Practice Guidance (2006); Factors represent averages; the exact emission factors depend on
the type of coal and oil product used. In the calculation the cost of carbon was evaluated at a more detailed
classification of fuels than the three fuels mentioned here.
28 / 58
Box 5 Costs of investment, maintenance and operation of the heat generating

equipment
Improving insulation usually leads to increased capacity since reduction in heat loss allows
for increased efficiency: less heat generating equipment is needed to produce the same
amount of heat. Including the costs related to heat generating equipment in the price of
heat would be justified if the gained capacity can be used effectively or if it can be avoided
that excess capacity is built in the first place.
Unfortunately insulation engineers are typically involved at a stage in which equipment

design is close to final, the required level of insulation has already been set, and the budget
for insulation has been fixed. Even if insulation engineers manage to convince their client of
a cost-effective or energy efficient insulation system, the designed heat generation capacity
is typically not reduced at a late stage in the design process. In the end, the equipment
is usually built with a too low level of insulation and an unnecessary high heat generation
capacity. This situation could easily be avoided by involving insulation engineers at an early
stage in the design process.
29 / 58
3 Energy savings and CO2 emissions mitigation potentials
3 Energy savings and CO2 emissions mitigation

potentials
3.1 Overview of different potentials

This study distinguishes three energy savings and CO2 mitigation potentials:
1) The potential from insulating currently uninsulated parts and from better
maintenance of insulation systems; Installing insulation on surfaces without
insulation and repairing damaged insulation is relatively inexpensive and has
typical payback periods of less than a year (see chapter 4 and case studies in
Appendix C). The absence of proper insulation is therefore typically not the result
of economic considerations but of organisational barriers (see section 1.3).
2) The potential from improving current insulation to cost-effective levels;

Cost-effective insulation in this study is defined as the insulation that minimises
the sum of the costs of heat loss and the costs of insulation (see section 1.4).
Companies seldom ask for economical standards, but instead ask for insu-
lation systems that meet safety rules and process needs or result in a generic
maximum heat loss rate. This usually leads to insulation levels that are not cost-
effective. Cost-effective insulation will therefore not only reduce heat losses,
but also save money with respect to current practices. In the past, when fuel
prices were lower, this would in many cases not have led to a large difference.
Nowadays, the price of energy is higher and is expected to grow even further. As
a result there is an increasing gap between current and cost-effective insulation
levels.
3) The potential from improving current insulation to energy efficient levels;

Energy efficient insulation in this study is defined as the insulation at which the
sum of the costs of heat loss and the annualised insulation investments are
equal to the costs of typical current insulation (see section 1.4). The definition
of a cost-effective level is based on the inputs to the calculation of cost-effec-
tiveness: discount rate, lifetime, costs of heat and cost of insulation. Which level
of insulation is perceived as cost-effective therefore depends on assumptions
about future developments. The future price of energy in particular may be higher
than expected. Insulating to energy efficient levels is a way to hedge that risk.
Another reason for insulating to energy-efficient levels is that it can help achieve
company goals for energy efficiency and emission reduction.
Improved insulation usually requires thicker layers of insulation material. Applying this material
is sometimes hampered by limitations in the space available. The spacing between pipes with
different temperatures may for instance be too small to allow for sufficient insulation material.
This could (partly) be solved by using insulation materials with better insulating properties, but
these would typically be associated with increased costs. This drawback can be minimised by
involving insulation engineers during early stages of equipment design.
Figure 3 - 1 and Table 3 – 1 show the combined potential from insulating surfaces without or
with damaged insulation and from improving current insulation to cost-effective and energy-
efficient levels.
30 / 58
Climate protection with rapid payback 3 Energy savings and CO2 emissions mitigation potentials
The results show that insulating all surfaces to cost-effective insulation would avoid about 66%
of current heat loss. Improving insulation to energy-efficient levels would even avoid about 75%
of current heat loss. These saving potentials represent about 5% of industrial energy con-
sumption and about 1% of energy input to fossil fuel-fired power plants. Appendix A shows an
indicative sectoral and regional breakdown of these potentials. Appendix B assesses the sen-
sitivity of these potentials to a number of key assumptions. Box 6 compares the potentials to
values found in literature.
1,000
900 insulation and surface with damaged
insulation
800 Heat loss over insulated surface
Heat loss in PJ per year
700
600
500
400
-66%
300
-75%
200
100
0
C urrent typical insulation C ost-effective insulation Energy-efficienct insulation
practices levels levels
Figure 3-1 Potential from improving current insulation and insulating surfaces without or with damaged insu-
lation; Reductions in heat loss assume insulation of the total surface of all equipment. In reality, a
small share of the total surface cannot be insulated due to technical restrictions
Table 3-1 Potential from improving current insulation and insulating surfaces without or with damaged
insulation; values have been rounded to two significant numbers; Potentials assume insulation
of the total surface of all equipment. In reality, a small share of the total surface cannot be insu-
lated due to technical restrictions
Annual cost - Annual energy -

effective savings efficient savings
potential potential
Uninsulated surfaces and surfaces with damaged
460 PJ / 37 Mt CO2 460 PJ / 37 Mt CO2
insulation
Currently insulated surfaces 160 PJ / 13 Mt CO2 240 PJ / 19 Mt CO2
Total 620 PJ / 49 Mt CO2 710 PJ / 56 Mt CO2
31 / 58
Box 6 Literature comparison of total potential
The cost-effective savings potential of about 5% of total industrial energy input found by
this study is within the range of literature estimates:
• UBA (2003) estimates that the potential from improving insulation of steam pipes
and other steam/hot water related equipment is 0.8% and 1.0 respectively. For
furnaces this potential was estimated to be 3%. This is consistent with U.S. DOE-
ITP (2007), which estimates that reducing the wall heat losses of furnaces would
lead to typical savings of 2- 5%. Assuming that about 40% of all fuel use is related
to steam related equipment and 37% for direct process heating (U.S. DOE-ITP,
2010), improving insulation of steam/hot water related equipment and furnaces
together can be roughly estimated to save 1.7% of total industry fuel consumption.
• Based on a number of investigated plants, Mauch (2011) preliminary estimates
potential savings from technical insulation to be between 0.2 - 0.6% of total fuel
consumption and found that savings as reported in literature range from 0.8% to
5%.
• For U.S. industry, on the basis of U.S. DOE’s Industrial Assessment Center pro-
gram, Russell (2002) estimates that potential savings from insulation application
and upgrades may reduce fuel consumption anywhere from 3% to 13%.
3.2 The potential from insulating currently uninsulated parts and from
better maintenance of insulation systems
Figure 3 - 2 shows the current heat loss over surfaces without or with damaged insulation in
European (EU27) fossil fuel-fired power generation and industry. It also shows the heat loss that
would occur if these surfaces were insulated to a cost-effective level. In all cases, more than
90% of the current heat loss could be avoided. For high-temperature surfaces, the energy saved
is significant even though only 2% of the total surface is assumed to be without or with damaged
insulation. Box 7 compares the potentials to values found in literature.
32 / 58
400
350
Missing/damaged insulation
300
Cost-effective level of insulation
250
200
150
100
50
-90% -95%
-98% -94% -99%
0
Fossil fuel-fired Industry: low - Industry: middle- Industry: high- Industry: total
pow er generation temp. surfaces temp. surfaces temp. surfaces
(< 100 °C) (100 - 300 °C) (> 300 °C)
Figure 3-2 Potential in the EU from insulating currently non-insulated and repairing damaged insulation; Reduc-
tions in heat loss assume insulation of the total surface of all equipment. In reality, a small share of
the total surface cannot be insulated due to technical restrictions
Box 7 Literature comparison of potential from insulating currently uninsulated parts

and from better maintenance of insulation systems.
The savings given above are consistent with the limited literature available. Insulation is
reported to reduce radiative heat loss from surfaces by 90 % (Hart, 2001).
Table 3 - 2 shows the result of an analysis of the database of U.S. DOE’s Industrial
Assessment Center program (IAC, 2011). The table lists a selection of relevant measures,
together with the savings of each measure expressed as share of the total fuel use of the
plants to which a specific measure was recommended. Taking into account that often mul-
tiple measures can be applied to a single plant, the savings from these measures are in the
same order of magnitude as the 3.2% found in this study.
Table 3-2 Fuel savings from measures that involve applying insulation to bare surfaces or repairing insu-
lation (Analysis of IAC database, 2011); savings are expressed as share of the total fuel use of
plants to which a measure was recommended after an audit.
Insulation measure Savings as share of total fuel use

Insulation in furnaces to facilitate heating / cooling 2.2%
Repair faulty insulation in furnaces, boilers, etc 1.2%
Install / repair insulation on condensate lines 0.8%
Insulate feedwater tank 0.6%
Insulate steam / hot water lines 0.6%
Repair faulty insulation on steam lines 0.2%
Insulate bare equipment 1.2%
33 / 58
3.3 The potential from improving insulation of currently insulated

surfaces
Figure 3 - 3 and Figure 3 - 4 compare current heat loss rates to heat loss rates in case of cost-
effective and energy-efficient insulation for five normalised case studies (see Box 2 in section
1.4) at 5 Euro/GJ heat and 10 Euro/GJ heat. The figures show that heat loss over insulated sur-
faces can be significantly reduced compared to current average rates. With higher heat prices,
the level of insulation that can be installed cost-effectively is higher, leading to lower heat loss
rates.
200
>300°C 300-100°C <100°C Heat loss at current typical
180 level of insulation:
Heat loss at cost-effective

160
level of insulation:
140 Heat price of 5 Euro/GJ

2
Heat loss in W/m
100
80
60
40
20
0
1 GW power Pipe Part of a Part of a Part of a
plant (Ø ≈ 400 mm; chemical methane brewery
(avg. process ΔT ≈ 350K) plant compressor (T ≈ 84°C)
temp) (T ≈ 200°C) station
(T ≈ 150°C)
Figure 3-3 Comparison of heat loss rates resulting from cost-effective insulation and typical current insulation
34 / 58
200
>300°C 300-100°C <100°C Heat loss at current typical
180 level of insulation:
Heat loss at energy-efficient

160
level of insulation

2
Heat loss in W/m
100
80
60
40
20
0
1 GW power Pipe Part of a Part of a Part of a
plant (Ø ≈ 400 mm; chemical methane brewery
(avg. process ΔT ≈ 350K) plant compressor (T ≈ 84°C)
temp) (T ≈ 200°C) station
(T ≈ 150°C)
Figure 3-4 Comparison of heat loss rates resulting from energy-efficient insulation and typical current insulation
Figure 3 - 5 shows the current heat loss for insulated surfaces in European (EU27) fossil fuel-
fired power generation and industry. The figure also shows the heat loss in case these surfaces
would be insulated to cost-effective and energy-efficient levels. The figure does not show losses
over surfaces without or with damaged insulation. The figure shows that savings can be attained
at all temperature levels. For industry, the savings potential for low-temperature surfaces is
about equal to the potentials for middle and high-temperature surfaces together. Appendix B
assesses the sensitivity of these results to a number of key assumptions.
400
350 Current level of insulation
Cost-effective level of insulation

300
Energy-efficient level of insulation

250
200
150
100
50
0
Fossil fuel-fired Industry: low- Industry: middle- Industry: high- Industry: total
power generation temp. surfaces temp. surfaces temp. surfaces
(< 100 °C) (100 - 300 °C) (> 300 °C)
Figure 3-5 Heat loss at current, cost-effective and energy-efficient level of insulation in EU27. Losses over sur-
faces without or with damaged insulation are not included
35 / 58
Box 8 Literature comparison of potential from improving current insulation to cost-

effective levels
Savings found in this study are consistent with expert opinions and with an analysis of the
database of U.S. DOE’s Industrial Assessment Center program (IAC, 2011). Table 3 - 3
shows the results of this analysis for measures that involved improving insulation. The
potential savings are valid for audited plants that were recommended to take specific mea-
sures. Overall the results of the analysis suggests a somewhat larger potential than the
1.3% found in this study, but the average level of insulation in Europe is known to be higher
than in the U.S.
Table 3-3 Fuel savings from measures that involve improving insulation to optimum levels (Analysis of
IAC database, 2011); savings are expressed as share of the total fuel use of plants to which a
measure was recommended after an audit.
Insulation measure Savings as share of total fuel use
Increase insulation thickness 3.0%
Use optimum thickness insulation 4.4%
Use economic thickness of insulation for low 1.3%
temperatures
36 / 58
Climate protection with rapid payback 4 Investments and employment
4 Investments and employment
4.1 Investments
Figure 4 - 1 shows investments required to improve insulation to cost-effective and energy-effi-
cient levels together with the corresponding annual savings from reduced heat loss. Table 4 - 1
shows the required investments and average simple payback periods.
The results show that on average the savings from improving insulation to cost-effective
and energy-efficient insulation levels over total insulation lifetime (estimated to be 15 years
on average; see section 2.3) more than balances the additionally required initial invest-
ments. Investments in projects targeted at surfaces without or with damaged insulation will on
average even be earned back in less than a year. Such short simple payback periods are in
1
line with periods reported in literature (see e.g. King, 2010; Russell, 2002 and case studies in
Appendix C) and what experts find in practice.
Replacement of current insulation by better insulation on average has payback periods of 5

– 10 years. Such projects are typically not implemented by companies. The savings potential
from improving current insulation is therefore best realised during general overhauls and instal-
lation of new equipment when new insulation needs to be applied anyway. This does not mean
that removal and replacement of currently applied insulation is never financially attractive.
Depending on the application and age, state and thickness of currently applied insulation,
payback periods may be much shorter than 5 years.
Cost-effective insulation Energy-efficient insulation

20
18 Initially required investments

in insulation
16
Annual savings from reduced
14 heat loss
12
Billion Euro
10
0
Uninsulated surfaces Currently insulated Uninsulated surfaces Currently insulated
and surfaces with surfaces and surfaces with surfaces
damaged insulation damaged insulation
Figure 4-1 Investments required for improving insulation to cost-effective and energy-efficient levels and cor-
responding annual savings from reduced heat loss; Costs for any removal of old insulation were not
considered.
1
The simple payback period of a project is the required investment divided by the difference between its annual
benefits and costs. By dividing the difference in investment costs by the difference in the costs of lost energy, a
simple payback time can be calculated for improving the current insulation by cost-effective insulation.
37 / 58
4 Investments and employment
Table 4-1 Investments required for improving insulation to cost-effective and energy-efficient levels; val-
ues have been rounded to billions
Investments required for Investments required for

cost - effective insulation energy – efficient insulation
(Billion Euro) (Billion Euro)
Uninsulated surfaces and surfaces 1 2
1
with damaged insulation (avg. SPP : 0.2 years) (avg. SPP: 0.4 years)
2 6 17
Currently insulated surfaces (avg. SPP: ~4 years) (avg.SPP: ~8 years)
Total required investments 7 19
1
SPP: simple payback period; required investment divided by the difference between its annual benefits and
costs.
2
Costs for any removal of old insulation were not considered.
Figure 4 - 2 compares costs of heat and investments related to typical current insulation and
cost-effective insulation. The costs and savings of heat loss are totals over an insulation lifetime
of 15 years and take into account energy price increases (see section 2.4). Future benefits have
not been discounted.
Current typical Cost-effective
insulation insulation
11%
23%
Costs of heat
loss over
1st Qtr lifetime
2nd Qtr
58% Investments
19%
Cost savings
89% from reduced
heat loss
Figure 4-2 Visualisation of cost savings from reduced heat loss for an average insulated surface
The figure shows that cost-effective insulation requires a higher initial investment, but, because
of cost savings from reduced energy loss, will over the total insulation lifetime lead to lower
costs.
Costs for current typical insulation:
Costs for cost-effective insulation:
The cost-savings that can be achieved depend on characteristics of the specific application. As
a general rule, the achievable cost savings of improved insulation increase with longer operation
times and lifetimes.
38 / 58
Climate protection with rapid payback 4 Investments and employment
4.2 Employment
Improvement of insulation not only leads to energy savings but also saves jobs and will create
new jobs because of additional investments in energy efficiency.
Current insulation levels could gradually be improved to cost-effective levels over the next 15
years; the average insulation lifetime used in this study. Table 4 - 1 shows that this improvement
can be expected to be accompanied by additional investments of roughly 6 billion Euros (or
about 0.4 billion Euros per year). Further it is assumed that with every additional 100,000
Euros of turnover the insulation industry hires one additional employee. Under these assump-
tions, it follows that cost-effective insulation has the potential to lead to a structural increase in
employment by about 4,000 people EU wide. A similar assessment for energy-efficient insu-
lation will lead to even higher estimates.
39 / 58
5 Conclusions and recommendations
5 Conclusions and recommendations
5.1 Size of the potential

A savings potential was found to exist across all regions, sectors and equipment operating tem-
peratures. Potentials vary between regions and sectors, due to differences in energy use, tem-
perature profiles and fuel mix.
The results show that about two thirds of the energy and emission saving potential is in unin-
sulated or damaged insulation. The remaining part of the potential would come from improving
insulation on currently insulated surfaces. Insulating all surfaces to cost-effective insulation
would avoid about 66% of current heat loss. This corresponds to about 620 PJ (about ~480
PJ for industry and ~140 PJ for fossil fuel-fired power plants). Improving insulation to energy-
efficient levels would even avoid about 75% of current heat loss, corresponding to about 710 PJ
(~550 PJ for industry and ~160 PJ for fossil fuel-fired power plants). Saving potentials represent
about 5% of industrial energy consumption and about 1% of energy input to fossil fuel-fired
power generation. Potentials may be substantially higher or lower for individual plants.
The order of magnitude of the total savings potential shows that technical insulation can sig-
nificantly contribute to achieving EU’s 2020 climate and energy targets, known as the “20-
20-20” targets: a reduction in EU greenhouse gas emissions below 1990 levels and a 20%
reduction in primary energy use compared with projected levels by improving energy efficiency.
Improving insulation will not only save energy but also costs and could have a positive effect on
employment.
The results of this study are endorsed by insulation experts and are reasonable when tested
against results of real insulation projects. Since the number of insulation projects available for
this study did not allow robust statistical analyses, the found potentials should nevertheless be
regarded as indicative estimates.
5.2 How to tap the potential?

This study shows that insulating uninsulated equipment and repairing damaged insulation
parts combines the biggest energy and emission cost-effective savings potential with payback
periods of less than one year. It is therefore recommended that industry focuses first on those
uninsulated and damaged parts which can be insulated quickly and easily and bring immediate
benefits.
Compared to current typical insulation practices, cost-effective insulation will save both energy
and money. It is therefore recommended that cost-effectiveness is evaluated in future projects.
Since insulating now, saves money in the future, the cost-effectiveness should be evaluated
using expected future costs of energy.
Removal and replacement of current insulation is attractive under some circumstances.

Replacing damaged insulation or insulating bare equipment is normally always cost-effective.
The savings potential of improving current insulation to cost-effective levels is therefore best
realised during general overhauls and installation of new equipment.
40 / 58
Climate protection with rapid payback 5 Conclusions and recommendations
During general overhauls and installation of new equipment, it is recommended that insulation
beyond cost-effective levels is also considered. Insulating beyond cost-effective levels is a way
to partly mitigate the risks of increasing energy prices and can help achieve company goals for
energy efficiency and emission reduction.
According to experts, the present absence of cost-effective insulation is partly the result of
organisational barriers. To realise the potential of improved insulation, it is therefore recom-
mended that these barriers are identified and tackled where they exist.
Application of insulation material is quite often hampered by limitations in the space available,
for example between pipes with different temperatures. To avoid this problem, it is recom-
mended that insulation engineers are involved at an early enough stage in the design phase of
new equipment or retrofit projects.
41 / 58
6 6
42 / 58
Climate protection with rapid payback 6 Reference sources
6 Reference sources
[1] Acca, “The cost of capital in Europe: an empirical analysis and the preliminary impact
of international accounting harmonization,” Certified Accountants Educational Trust
for the Association of Chartered Certified Accountants, London, 2006;
[2] Barnett, G.P., “Designing factors,” Steam Digest, Volume IV, 2003, pp. 13-18
[3] Blok, K., “Introduction to Energy Analysis,” Techne Press, Amsterdam, 2007
[4] Damodaran, Cost of Capital per Sector, Data used: Value Line database of 5928
firms; Data used is as of January 2011, http://pages.stern.nyu.edu/~adamodar/New_
Home_Page/datafile/wacc.htm (accessed August 2011)
[5] EC, “EU energy trends to 2030,” European Commission, 2009a
[6] EC, “Study on the Energy Savings Potentials in EU Member States, Candidate Coun-
tries and EEA Countries,” European Commission, 2009b
[7] ECN, “Transitie naar een duurzame energievoorziening in 2050; Evolutie of Revo-
lutie?” Energieonderzoek Centrum Nederland, October 2002.
[8] EiiF, Expert meeting in November 2010, European Industrial Insulation Foundation,
2010a
[9] EiiF, Questionnaire to insulation experts on level of awareness and current insulation
performance, European Industrial Insulation Foundation, 2010b
[10] EiiF, standard specifications of six companies (four in the power sector, one in the
brewery sector and a provider of boiler systems, provided by European Industrial
Insulation Foundation, 2010c
[11] EiiF, questions to technical experts on first results, European Industrial Insulation
Foundation, March 2011
[12] EiiF, text on cold insulation based in the following data sources:
• AGI Q 03: Thermal insulation – Execution of thermal and cold insulations – Insula-
tion work on industrial installations
• AGI Q 157-7: Cold protection – Polyurethane in-situ foam, insulation layer thick-
nesses to prevent condensation, cold losses, masses
• DIN 4140: Insulation work on industrial installations and building equipment – Exe-
cution of thermal and cold insulations
• FESI Technical Lexicon (available at http://cms.fesi-insulation.eu/_private/PDFs/
Lexicon/Lexicon.pdf) accessed March 2012
• Technische Briefe der BFA Wärme-, Kälte-, Schall- und Brandschutz im Hauptver-
band der Deutschen Bauindustrie e.V. 10898 Berlin
• Nr. 7 “Grundlagen der Kälteisolierung – Principles of cold insulation”, (July 2009,
3. überarbeitete Auflage)
43 / 58
6 Reference sources
• Nr. 8 “Auslegung der Kälteisolierung zur Tauwasserverhütung auf der Oberfläche

– Design of cold insulation to prevent formation of condensation on the surface”,
(November 2011, 3. überarbeitete Auflage)
[13] European Industrial Insulation Foundation, April 2012
[14] EURIMA, “U-Values; For better energy performance of buildings,” report established
by Ecofys for the European Insulation Manufacturers Association, 2007
[15] FfE, “Ganzheitliche dynamische Bewertung der KWK mit Brennstoffzellentech-

nologie,” Forschungsstelle für Energiewirtschaft e.V., München, November 2007.
[16] FfE, “Energiezukunft 2050; Teil 1 – Methodik und IST-Zustand,” Forschungsstelle für
Energiewirtschaft e.V., München, October 2009.
[17] Hart, G., “Best Practices in Steam System Management,” Steam Digest 2001, pp.
11-15
[18] Hart, G., “Insights for insulation installation,” Steam Digest, Volume IV, 2003, pp.
19-26
[19] Hertel website, Industrial Thermal Insulation; Power & Utilities, http://www.hertel.com/
en/power-and-utilities/insulation/thermal-insulation.html (accessed August 2011)
[20] Howarth, R.B. and Sanstad, A.H. “Discount rates and energy efficiency,” Contem-
porary Economic Policy, Volume 13, Issue 3, July, 1995
[21] IAC Database, Industrial Assessment Centers Database containing 15,079 assess-
ments and 113,083 Recommendations, available at http://iac.rutgers.edu/database/,
downloaded August 2011
[22] IEA, 2007 energy statistics, International Energy Agency, 2010
[23] IPCC, Guidelines for National Greenhouse Gas Inventories, Volume 2: Energy, Inter-
national Panel of Climate Change, 2006
[24] Jaffe, A.B., Newell, R.G. and Stavins, R.N., “Economics of Energy Efficiency,” Ency-
clopedia of Energy, Volume 2, Elsevier Inc., 2004
[25] KAEFER, 2010, “Optimum insulation layer thickness distribution leads to enhanced
profitability,” KAEFER Corporate Technology & Research, Technical Information, No.
CTR-T 10 101 EN, 2010 (provided by EiiF)
[26] King, R.L., “Mechanical Insulation Maintenance: A Proven Investment Opportunity

Hidden in Plain Sight,” Insulation Outlook, December 2010.
[27] Lettich, M.J., “Insulation Management and Its Value to Industry,” Steam Digest,
Volume IV, 2003, pp. 27-32
[28] Mauch, W., “Energieeinsparpotenzial durch technische Dämmung,” FIW Wärme-

schutztag, Forschungsstelle für Energiewirtschaft e.V., 26 May 2011
44 / 58
Climate protection with rapid payback 6 Reference sources
[29] Meier, I. and Tarhan, V., “Corporate investment decision practices and the hurdle rate
premium puzzle,” Working Paper, 2007, as cited by Oxera (2011)
[30] NCTI (2011); Article on website: “Hoe duurzaam is groen?” (available at http://www.
ncti.nl/index.php?pageid=8&lang=&parentid=8#50); accessed January 2010
[31] Newell, R.G., Jaffe, A.B. and Stavins, R.N., “The effects of economic and policy
incentives on carbon mitigation technologies,” Energy Economics, 28, 2006, pp.
563–578
[32] Oxera, “Discount rates for low-carbon and renewable generation technologies,” pre-
pared for the Committee on Climate Change, April, 2011
[33] Poterba,J. and Summers, L., “A CEO Survey of U.S. Companies’ Time Horizons and
Hurdle Rates,” Sloan Management Review, Fall, 1995, pp 43-53, as cited by Oxera
(2011)
[34] Russell, C, “Insulation Improves Economic Returns in Manufacturing,” Steam Digest,

Volume III, 2002, pp. 35-36
[35] UBA, “Möglichkeiten, Potenziale, Hemmnisse und Instrumente zur Senkung des
Energieverbrauchs branchenübergreifender Techniken in den Bereichen Industrie
und Kleinverbrauch,” Prepared by Fraunhofer Institut and Forschungsstelle für Ener-
giewirtschaft e.V. for Umweltbundesambt Germany, Karlsruhe/München, Juli 2003
[36] U.S. DOE-ITP, “Improving Process Heating System Performance: a sourcebook

for industry,” Second Edition, U.S. Department of Energy, Industrial Technologies
Program, 2007
[37] U.S. DOE-ITP, “Manufacturing Energy and Carbon Footprint,” Prepared for the Indus-
trial Technologies Program (ITP) by Energetics Incorporated, version December 2010
(available at http://www1.eere.energy.gov/industry/rd/footprints.html)
[38] U.S. EPA, “Understanding Cost-Effectiveness of Energy Efficiency Programs: Best

Practices, Technical Methods, and Emerging Issues for Policy-Makers,” Energy and
Environmental Economics, Inc. and Regulatory Assistance Project, November 2008.
[39] VDI, “Thermal insulation of heated and refrigerated operational installations in the
industry and the building services; Calculation rules,” VDI 2055, Verein Deutscher
Ingenieure, September 2008.
[40] WikiWealth, Industrial and Energy Industry Research & Analysis, based on largest
30 companies in each industry, http://www.wikiwealth.com/wacc (real-time data;
accessed August 2011)
45 / 58
A Breakdown of potential by sector and region
A Breakdown of potential by sector and region
A.1 Potential per sector

Figure A - 1 shows the distribution of the energy and emissions savings potential over different
sectors. The saving potentials per sector have been calculated on the basis of overall energy
use, temperature profile and the fuel mix. Differences in typical investments in insulation and
insulation maintenance have not been considered since no data to support analyses of such
aspects were available. It is stressed that potentials per sector were not obtained from detailed
sector-specific investigations and can therefore only be used as indicative estimates.
Figure A-1 Annual energy and emissions savings potential per sector
A.2 Potential per region

To assess the geographical distribution of the savings potential, the countries in EU27 are
grouped in four regions (see Figure A - 2).
46 / 58
Climate protection with rapid payback A Breakdown of potential by sector and region
Figure A-2 Regional division of EU27 for the purpose of this study
Figure A - 3 shows the annual energy and emissions savings potential for each region. The
saving potentials per region have been calculated on the basis of overall energy use, sector
temperature profile and the fuel mix. Differences in typical investments in insulation, insulation
maintenance and regional differences in temperature profiles have not been considered since
no data to support analyses of such aspects were available. It is stressed that potentials per
region were not obtained from detailed region-specific investigations and can therefore only be
used as indicative estimates.

Figure A-3 Annual energy and emissions savings potential per region
47 / 58
B Sensitivity analyses
B Sensitivity analyses
B.1 Missing and damaged insulation

Table B - 1 shows the savings potential of cost-effective insulation for different assumptions of
the shares of surface without or with damaged insulation. The table shows that:
• the savings potential of insulating surface without or with damaged insulation

strongly increases with the increased presence of such surfaces
• For all assumed shares of uninsulated surfaces, the potential of insulating such
surfaces is larger than that of improving insulation of surfaces that are already
insulated
• The potential from improving insulation of surfaces that are already insulated
slowly decreases since a higher share of uninsulated surface means a lower share
of insulated surfaces.
Table B-1 Savings potentials for different shares of surfaces without or with damaged insulation.
Savings potential of Savings potential of

Share of surface without or
improving insulation to insulating surfaces
with damaged insulation:
cost-effective levels of without or with damaged
low-temp./mid-temp./
surfaces that are already insulation to cost-effective
high-temp. surfaces
insulated in PJ/year levels in PJ/year
6/3/1 167 244
10 / 6 / 2 162 459
15 / 10 / 4 156 823
B.2 Cost-effective insulation

A sensitivity analysis was performed to investigate the effect of different assumptions regarding
the discount rate (see section 2.3.2) and price of energy (see section 2.4). The reason for
checking the effects of these two specific parameters is that an investor can choose what dis-
count rate and heat price is used when calculating the profitability of an investment.
Table B - 2 shows the result of this analysis. The upper value in the table shows the average
cost-effective heat rate over all surfaces. The lower value in each cell shows the total EU cost-
effective savings potential for all sectors considered. The table only considers surfaces that cur-
rently are insulated and not surfaces without or with damaged insulation.
The middle cell shows the potential under the assumptions used by this study. These assump-
tions intend to reflect real market conditions and therefore result in a potential from a private
perspective. The top left cell shows the potential that is economically attractive from a social
perspective.
The table shows that lower discount rates and higher heat prices lead to higher levels of cost-
effective insulation and a greater cost-effective potential. In addition, the table shows that taking
into account costs related to the heat generating equipment has a much greater impact than
assuming a moderate price increase over time. The most important conclusion to be drawn from
48 / 58
Climate protection with rapid payback B Sensitivity analyses
the table however is that there exists a significant cost-effective potential over a wide range of
assumptions.
Table B-2 Cost-effective rate of heat loss (upper value) and savings potential (lower value) for different
assumptions regarding discount rate and price of energy.
Costs of heat increase over

Discount Costs of heat remain Costs of heat time and take into account
rate constant over time increase over time* costs of heat generating
equipment (6 Euro/GJ)
2 2 2
52 W/m 49 W/m 38 W/m
3%
185 PJ 195 PJ 229 PJ
2 2 2
64 W/m 60 W/m 46 W/m
9%*
151 PJ 162 PJ 209 PJ
2 2 2
76 W/m 72 W/m 55 W/m
15%
118 PJ 129 PJ 180 PJ
* Assumptions used in this study.
B.3 Energy-efficient insulation

Similar to the case for cost-effective insulation, a sensitivity analysis was performed to inves-
tigate the effect of different assumptions regarding the discount rate (see section 2.3.2) and
price of energy (see section 2.4). Rate of heat loss (upper value) at energy-insulation levels and
corresponding savings potential (lower value) for different assumptions regarding discount rate
and price of energy. Table B - 3 shows the result of this analysis. For a description of the table,
the reader is referred to the previous section. Again the most important conclusion is that there
is significant potential over a wide range of assumptions.
Table B-3 Rate of heat loss (upper value) at energy-insulation levels and corresponding savings potential
(lower value) for different assumptions regarding discount rate and price of energy
Costs of heat increase over

Discount Costs of heat remain Costs of heat time and take into account
rate constant over time increase over time* costs of heat generating
equipment (6 Euro/GJ)
2 2 2
24 W/m 22 W/m 14 W/m
3%
266 PJ 275 PJ 302 PJ
2 2 2
35 W/m 32 W/m 19 W/m
9%*
232 PJ 243 PJ 284 PJ
2 2 2
48 W/m 44 W/m 26 W/m
15%
191 PJ 205 PJ 261 PJ
* Assumptions used in this study.
49 / 58
C Best practice in industry

Every theory becomes more convincing if executed example cases from the real world can be
presented alongside it. This is why the EiiF collected the following examples from her Partners
& Members. Each of them clearly supports the message put forward in this study. Consid-
ering that the examples presented here are all situated in countries that are known for having
a better-than-average insulation standard, it is fair to assume that the situation in the whole of
Europe will have an even greater potential than the one that is painted here.
C.1 Chemical plant, France

A TIPCHECK energy audit was performed on a chemical plant in France by an EiiF Founding
Partner. The auditing consisted of just one employee, spending two weeks on-site and taking
over 400 thermal images for the final audit report. These were the most important findings:
Safety
Situations were located where a high risk of burn damage exists to the personnel. In the first
image, the thermographic picture shows a dangerously hot surface temperature of more than
138 °C on a boiler window, situated right next to a ladder support.
Figure C-1 Regular and thermographic photo of a boiler window
Energy efficiency & environment – valves
Secondly, about 30 uninsulated valves were found that not only pose a severe burn risk for per-
sonnel, but also cause a large loss of energy. Instalment of mattress insulation on these parts
ensures temperatures of below 50°C, which is safe to be handled by personnel wearing gloves.
50 / 58
Climate protection with rapid payback C Best practice in industry
Figure C-2 Regular and thermographic photo of an uninsulated valve
Detected energy loss on each valve:
Internal temperature: ~300 °C

Unnecessary energy loss (8,760 operating hours): approx. 20,000 kWh / year
Total saving potential for valves:
30 valves x 20,000 kWh/year = approx. 600,000 kWh/year
Energy efficiency & environment – tanks
Also, 35 storage tanks were found with uninsulated rooftops. The surface of these is about
28 m /tank. The temperature of liquids stored inside being 150°C.
2
Figure C-3 Thermographic photo of a tank
Saving potential per tank:
Internal temperature: 150 °C

Unnecessary energy loss (8,760 operating hours): approx. 343 MWh/year
51 / 58
Total saving potential for rooftops:
35 rooftops x 343.3 kWh / year = approx. 12,000,000 kWh/year
Financial Gains
Investment:
TIPCHECK: approx. 10,000.- Euro

Insulation instalment and material costs: approx. 90,000.- Euro
Total investment: approx. 100,000.- Euro
Realised until today:
Energy cost savings first year approx. 405,000.- Euro

Energy cost savings following years: approx. 505,000.- Euro
Payback time:
Time until investment is paid back approx. 2.4 months

(energy cost only)
C.2 Refinery tower, Italy

In Italy, one of EiiF Founding Partners performed the following insulation efficiency audit on a
refinery tower.
With the maintenance work on the insulation, the choice was made
to upgrade the insulation and to improve the fire-safety of the instal-
lation. The owner also used a new insulation material with a higher
performance.
The result was that by improving their insulation the heat loss via the
insulated surfaces could be cut in half. The new system now is not
only cost-effective, but also saving energy and therefore reducing
CO2 emissions:
Total annual savings:
Energy savings: 1,021,958 kWh/year

Energy costs savings (7 ct/kWh): approx. 75,000 Euro/year
Payback time: 1-3* years
* The new insulation system had to improve the fire protection, which lead to more expensive materials than
those that would have been used for energy efficiency only. This higher investment extended the payback time in
this example from one to three years.
52 / 58
C.3 Processing plant, Germany

An asphalt boiler of a German company received a new
insulation cover. The installed elements consist of:
Tube, ferritic steel, 5 mm

thickness:
Width: 1.70 m
Depth: 0.760 m
Height : 26 m
2
Surface: 127,92 m
Other parameters:
Average heat price: 0.033 Euro/kWh

Operating hours: 1,500 hours /year
Project financials:
Insulation investment 12,792 Euro

Energy savings 1,448,500 kWh/year
Energy cost savings 47,800 Euro/year
Payback time < 3 months
C.4 Chemical plant, the Netherlands

The possible gains from insulating valves and other uninsulated elements of a plant that needed
to remain in operation, was investigated by an EiiF Founding Partner. The TIPCHECK engi-
neers measured temperature losses of about 80 objects in 37 different positions along the
production line. In this particular case, the client requested to insulate these parts following his
own insulation standards. This level is most likely lower than the cost-effective level discussed
throughout this study. As such, a higher savings potential could have been achieved if the
cost-effective or energy-efficient level of insulation would have been applied. Nevertheless the
savings are substantial:
Project characteristics:
Calculated cost of instalment 18,844 EUR

Calculated energy savings: 1,530,000 kWh/year
Savings feedback by client: 28,651 Euro/year
Payback time 8 months
53 / 58
Figure C-4 Regular and thermographic photo showing dangerously high-temperature surfaces
C.5 Machine room, the Netherlands

In this project the heat losses through uninsulated parts was estimated for a steam-distribution
net. The audit clearly shows the potential difference between uninsulated and already insulated
parts.
Project characteristics:
Calculated cost of instalment: 32,880 EUR

Calculated energy savings on 200 valves 1,280,000 kWh/year
Calculated energy cost savings on 200 valves: 33,530 Euro/year
Payback time approx. 1 year
Figure C-5 Regular and thermographic photo showing high-temperature surfaces
54 / 58
C.6 Refinery, Belgium

Engineers from an EiiF Founding Partner company were asked to perform an inspection on a
refinery in Belgium. They reviewed the state of the existing insulation system and measured the
heat loss over uninsulated parts. With all insulation works executed, roughly 5,000 GJ of energy
could be saved every year. This equals to about 325 tCO2, the average yearly emission of 90
private cars.
Calculated annual saving potential (8,760 operating hours):
4,930 GJ/year
Energy savings potential 1,370,00 kWh/
year
- Steam vessels 1,046 GJ/year
- Steam vessel room 58 GJ/year
- Steam vessel – front 124 GJ/year
- Preparation room 467 GJ/year
- Vessel 645 GJ/year
- Refinery room 687 GJ/year
- Extraction room 1,314 GJ/year
- Drums 589 GJ/year
Energy costs savings 36,640 Euro/year
potential
Figure C-6 Regular and thermographic photo showing high-temperature surfaces
C.7 Processing line, The Netherlands

For a processing plant in The Netherlands, insulation engineers were asked to investigate the
saving potential of applying, adjusting or improving thermal insulation on valves, flanges and
steam pipes in a particular part of the plant. Aside from the heat loss potential, the engineers
identified severe risks to personnel safety that the customer was not aware of.
55 / 58
Figure C-7 Regular and thermographic photo showing dangerously high-temperature surfaces
With a run-time of 6,800 hours per year, the calculated saving potential amounted up to about
118,400 m3 gas equivalent to 885,000 kWh/year. At the clients cost of 0.20 Euro/m3, this sums
up to about 23,700 Euro.
Availability 6,800 h
Energy Savings potential: 885,000 kWh/year
Energy cost savings potential: 23,700 Euro/year
C.8 Condensation on uninsulated parts

In applications with temperatures below the ambient level insulation has additional demands
besides limiting the loss of energy. Below are some examples of cases where several problems
occured. These problems were caused by either missing insulation on some parts, insufficient
insulation (causing dew point problems) or damaged vapour barriers and/or insulation.
Figure C-8 Pump breaks down Figure C-9 Valve can no longer be operated
56 / 58
Water vapour is always present in the air. When this vapour comes close to colder surfaces it
condensates. This condensation could happen either on uninsulated parts, or inside the insu-
lation layer. A good vapour barrier outside the insulation layer is therefore important.
If condensation is allowed to happen, the water (or ice) will:
• Increase energy losses

-- Water has a 20x higher thermal conductivity than air
-- Ice has a 100x higher thermal conductivity than air
• Cause damage to the insulation material
• Cause corrosion to pipes, vessels & cladding
• Cause structural problems for the installation (due to the extra weight)
• Cause inoperable valves, engines, pumps (ice build-up)
• Cause electrical shortcuts, make control panels brake down
Cold insulations have in general a limited life expectancy: They are unstable systems, which for
physical reasons react sensitively to damages. They must be maintained regularly, which
includes a routine check of seals and interruptions. This is needed not only to save decent
volumes of energy but also to keep industrial processes running.
Figure C-10 Control panel needed to be protected with plastic sheeting from the dripping condensation water.
Extensive ice building on pipes and valves
57 / 58
Figure C-11 Broken vapour barriers and insufficient insulation caused ice to form around these pipes causing
both process control problems and structural problems
58 / 58
European Industrial Insulation Foundation Ecofys Netherlands BV
Avenue du Mont-Blanc 33 Kanaalweg 16-G

CH-1196 Gland, Switzerland P.O. Box 8408
NL-3503 RK Utrecht, The Netherlands
t: +41 22 99 500 70 t: +31 30 66 23 300

f: +41 22 99 500 71 f: +31 30 66 23 301
[email protected] [email protected]
www.eiif.org www.ecofys.com
In 2007, EU leaders endorsed a set of ambitious climate and energy
targets to be met by the year 2020. These EU ambitions are known as the
20-20-20 targets.
In this policy context, there is significant attention on measures that reduce

energy demand and mitigate CO2 emissions in all sectors of the economy
such as the built environment, transport and industry.
From its experience, the European industrial insulation Foundation (EiiF)

is convinced that there is a significant potential for energy savings and CO2
mitigation by improving thermal insulation in industrial installations. This
potential is currently untapped despite being cost-effective to implement.
With energy and CO2 prices likely to rise, this potential is probably growing.
Against this background, EiiF commissioned Ecofys to identify the Energy
and CO2 savings potential of industrial insulation in EU27.
The European Industrial Insulation Foundation (EiiF) is a European non-

profit foundation registered in Switzerland. It has been set up to promote
and establish the use of industrial insulation as a widely understood and
accepted means of achieving sustainability.
Since its foundation EiiF has established itself as a resource for industries
that need to reduce CO2 emissions and save energy.
Established in 1984 with the vision of achieving “sustainable energy for

everyone”, Ecofys has become the leading expert in renewable energy,
energy & carbon efficiency, energy systems & markets as well as energy
& climate policies. The unique synergy between those areas of expertise
is the key to its success. Ecofys creates smart, effective, practical and
print: Elch graphics cover design: Ungermeyer, graphic affairs printed on 100% recycled paper
sustainable solutions for and with public and corporate clients all over the
world. With offices in the Netherlands, Germany, the United Kingdom,
China and the US, Ecofys employs over 250 experts dedicated to solving
energy and climate challenges.
We Power Sustainability
For more information:

www.eiif.org

ClimateProtectionWithRapidPayback Online

Uploaded by

Copyright:

Available Formats

ClimateProtectionWithRapidPayback Online

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

ClimateProtectionWithRapidPayback Online

Uploaded by

Copyright:

Available Formats

Climate protection

with rapid payback

Avenue du Mont-Blanc 33 Kanaalweg 15-G

t: +41 22 99 500 70 t: +31 30 662 31 20

Energy and emissions savings potential of industrial insulation in EU27

By order of: European Industrial Insulation Foundation

Date: 19 June 2012

Background of the study

Research questions and approach

4) How can these potentials best be realised?

Energy savings and CO emissions mitigation potentials

How big is the potential?

• The annual energy consumption of 10 million households

Investments in energy efficient insulations pay back

Current typical Cost-effective

Costs for current typical insulation:

Costs for cost-effective insulation:

Cost-effective or energy efficient industrial insulation will generate jobs

How to tap the potential?

2) Evaluate cost-effectiveness and consider insulating today beyond today’s

3 Energy savings and CO2 emissions mitigation potentials . . . . . . . . . . . . . 30

4 Investments and employment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

5 Conclusions and recommendations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

A Breakdown of potential by sector and region. . . . . . . . . . . . . . . . . . . . . . . . 46

C Best practice in industry. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

Figure C-8 Pump breaks down . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

1.1 Framework and goal of this study

• A 20% reduction in primary energy use compared with projected levels, to be

3) What is the technical potential available beyond current cost-effective insulation?

1.2 Why insulate?

1.3 Why is the potential still there?

• Insulation is a relatively small part of investments. Even though poor insulation

• There may be a lack of information about improvements in insulation materials

Costs of heat loss

• Low-temperature (ambient temperature – 100 °C)

• Middle-temperature (100 – 300 °C)

Insulation projects Potential from insulating un-insulated

Further potential beyond cost-effective

Figure 1-2 Overview of data sources and study results

Box 2 Case studies

• 1 GW coal-fired power plant: this case study predominantly involves temperatures

1.5 Outline of this report

• Chapter 2 discusses the project approach and assumptions.

2.1 Current insulation

Average rate of Average share

2.2 Current heat loss

2.2.1 Fuel-use related to each temperature-level

Chemical and petrochemical

Mining and quarrying

Food and tobacco

Wood and wood products

Fossil fuel-fired power generation

2.2.2 Energy loss over surfaces

Share of energy Share of energy

Figure 2-3 Current heat loss as share of fuel consumption in EU27

Heat loss over surface without

Heat loss over insulated surface

Figure 2-4 Current heat loss over surfaces in EU27

2.3 Investments in insulation