INSULATION -- Everything you wanted to know WHAT IS INSULATION?

and more.

Heat flows naturally from a warmer to a cooler space. In winter, the heat moves directly from heated living spaces to the outdoors and unheated areas like attics and basements. During the summer, heat moves from outdoors to the house interior. Insulation is a product that that blocks this transfer of heat, helping to keep your home and office either cool or warm. We like to think of it as a mousetrap for warm air. It is rated in terms of thermal resistance, called R-value, which indicates the resistance to heat flow and the higher the Rvalue, the greater the insulating effectiveness. The Department of Energy maintains a website that can help consumers select the appropriate R-value product but generally speaking, the further north you go, the higher the R-value needed (http://www.energysavers.gov/your_home/insulation_airsealing/).

Although we generally think of insulation in terms of thermal comfort, it is an excellent sound absorber, and when installed in walls and ceilings, can reduce the transmission of sound from other rooms or from the outside. Insulation products can also be used to reduce moisture transmission. For example, many fiberglass batts and blankets (which we ll learn more about shortly) come equipped with a facing material that acts as a vapor retarder to help resist the movement of moisture vapor to cold surfaces where it can condense. TYPES OF INSULATION There are four main types of insulation: 1) loose-fill; 2) rigid board insulation; 3) spray foam insulation and 4) batt and blanket insulation. Loose-fill, like the name suggests, is composed of loose fibers and fiber pellets that are blown into cavities or attics using special equipment. Rigid board insulation is generally composed of fiberglass, polystyrene, or polyurethane and comes in varying thicknesses. It is primarily used for reroofing flat roofs and basement. Spray foam insulation is a two-part liquid containing a polymer agent and a foaming agent. It is sprayed into small spaces and cracks to make things airtight. Batt and blanket insulation is the type of insulation most of us are familiar with. It is composed of mineral fibers, either processed fiberglass or rock wool, and comes in blanketed rolls of different widths. It is normally fitted between wood frames and rafters to insulate below the floors in homes, above the ceilings and within the walls. WHERE IS INSULATION USED?

Residential/Commercial High density insulation o Ducts o Ovens o Refrigerators o Cube walls

NONWOVEN INSULATION PRODUCTS Most of the insulation sold in the U.S. is fiberglass nonwovens sold in rolls, batts and blankets, which you have probably seen at your local Lowes or Home Depot. Fiberglass insulation is made from very fine strands of glass held together in a thick, random mat. Between the fibers are minute pockets of air. It is made using a meltblown process during which glass is melted and extruded onto a belt. By altering the speed of the belt, you can change the thickness and density of the insulation. During the extrusion process, phenol formaldehyde is added, which prevents the compacting of the insulation and gives it resilience. If the insulation were compacted it wouldn t be able to trap air and would inhibit the insulation s effectiveness. Although some have expressed concerns about the presence of formaldehyde in these products, the amount is truly negligible and only a minute amount remains in the final product. In Europe, they tend to use rock wool insulation (a.ka. mineral wool or slag wool) instead of fiberglass, which is made from mineral waste and is regarded as a dirty manufacturing process. Fiberglass and Rockwool are equally effective in insulating. HOW BIG IS THE INSULATION MARKET? Currently, the total insulation business in the U.S. is approximately $8.5 billion, but it is expected to show significant gains, with demand projected to rise some 5.3 percent annually through 2012, based on renewed growth in housing construction. Fiberglass will remain the leading insulation material and outpace demand for the second largest type, foamed plastic. Reflective insulation and radiant barriers will see the fastest growth, albeit from a small base. WHO ARE THE PLAYERS? Largest Insulation Manufacturers In priority order: Saint Gobain largest global manufacturer of insulation; U.S. affiliate is CertainTeed. Knauf maintains plants in the U.S. and Europe Owen Corning Used to have manufacturing locations in both the U.S. and Europe but sold European plants to help pay for asbestos claims. John Mansville Insulation Industry Associations The National Insulation Association (NIA) is an Alexandria, VA-based association that represents the mechanical and specialty insulation industry. The association has a staff of 10 and an annual

budget of $1-2 million and maintains a membership of approximately 450 member companies consisting of contractors, manufacturers, distributors, laminators and fabricators. NIA holds two major events each year, the annual convention in the spring and Committee Days, a meetingsoriented event, which occurs in the fall in the DC/Virginia area. Also located in Alexandria, VA, the North American Insulation Manufacturers Association (NAIMA), a trade association representing North American manufacturers of fiberglass, rock wool and slag wool insulation products. NAIMA s role is to promote energy efficiency and environmental preservation through the use of fiberglass, rock wool, and slag wool insulation products and to encourage safe production and use of these insulation products. They have 13 people on staff and a budget of $2-5 million. The big players companies listed above are all members of NAIMA. There are 8 additional associations listed in the National Trade and Professional Associations book. They have to do with electrical, distributors etc. CHALLENGES Global slow down in commercial and residential construction due to the ongoing economic recession, tight credit market, etc. OPPORTUN ITIES Growing Interest in Energy Efficiency Among Policymakers The Energy Policy Act of 2005 provided tax incentives for improved energy efficiency including addition of insulation to residential and commercial buildings; October 2008, Pres. Bush signed into law provisions extending these consumer tax credits through the end of 2009. Both the House and Senate versions of the stimulus bill currently being debated contain provisions allocating billions towards energy efficiency measures, including tax benefits for weatherizing homes. The Obama Administration has already begun the process of calling for stricter energy efficiency regulations in terms of higher fuel-efficiency standards and we can expect that trend to extend into other arenas and through states and localities. Public/Consumer Interest in Energy Efficiency/Sustainability Whether driven by financial reasons or a more ideological commitment to sustainability, we can expect to see a growing interest in products that help increase energy efficiency, including thermal insulation products. For the cost conscious consumer, insulation reduces the transfer of heat, thereby lowering heating and cooling bills. For the green-consumer concerned about long-term sustainability, insulation lowers our use of energy, thereby preserving existing resources.

Companies like Owens Corning are capitalizing on these sentiments during the construction/building slowdown and are working to grow a new market category re-insulation. According to the Department of Energy standards, nearly 80 million U.S. homes are estimated to be under insulated. The company says its business solutions can help customers capture these reinsulation opportunities. There is a huge opportunity in the retrofit market to create sales in an environment where new construction is at its slowest since the 1970s, said Dave LeHotan, president of All Construction Services, a branch of Installed Building Products, out of Brunswick, Ohio, and an Owens Corning customer, who has been a long-time proponent of upgrading insulation to today s standards. We have positioned our company to take full advantage of the re-insulation opportunity, and with this launch, Owens Corning will be providing a solution to fully tap the market. Insulation is the answer, continued LeHotan. Saving money and energy is on everyone s mind, and insulation offers the best bang for your buck. Working with Owens Corning is helping us make the most of the re-insulation opportunity. Largest Markets for Insulation? Europe? Why? After the oil price increases Europe established stricter regulations requiring insulation. Also people in the Mediterranean and Arab Countries have discovered air conditioning and air conditioning requires insulation. Other growing markets are Mexico and Latin America ..guess they like air conditioning, too.