Heating and cooling accounts for more than 50 percent of the energy used in U.S. homes, according to the U.S. Department of Energy. Your energy savings can be significant if your home is properly sealed and insulated either during or following construction.

By improving your home’s insulation, you may be able to reduce your energy bills by up to 20 percent. This can add up to hundreds of dollars in home energy savings per year. In many cases, the cost of the insulation upgrades pay for themselves in just a few years. You may also qualify for tax credits for improving your home insulation.

Home Energy Savings: What You Can Do

Your home uses a number of different types of energy and resources every day. Common resources used in homes include:

• Electricity
• Heating oil
• Natural gas
• Propane
• Water.

By reducing consumption of any of these resources, you can save money. Adding insulation to your walls, attic and basement can reduce your space heating and cooling costs, while insulating a hot water heater should reduce water waste and energy bills.

Where to Find Insulation Energy Savings

You may be able to save money by adding insulation to the following areas of your home, among others:

• Attic
• Basement
• Plumbing and hot water heater.

Your overall insulation cost savings will depend on a number of factors, including how much it costs to install and energy costs in your area. However, there is no doubt that the savings from improved insulation can sometimes be significant. For example, adding 2 to 3 inches of foam insulation to a basement in Minneapolis, Minnesota, may save a homeowner up to $400 a year. A well-insulated water heater will save you between 4 and 9 percent per year in water heating costs.

If you’re going to improve insulation in your house, the attic is probably the place to start because attics contribute significantly to heat loss and gain in a home. Adding fiberglass batts crosswise on top of existing insulation is one way to improve attic insulation. You may also choose to add blown-in loose-fill insulation. Don’t forget to insulate the attic door.

Other Ways to Save

Finding and repairing air leaks in your home can increase your energy savings by another 10 percent. Places to look for leaks include windows, doors, fireplaces and electrical outlets. Proper insulation can also reduce problems with moisture buildup and mold growth, which can damage a home and be costly to repair. Properly insulated cold water pipes can prevent damage from frozen pipes.

Improving insulation may also save you money on your tax bill. Homeowners in the United States who make improvements to their insulation may be able to qualify for a Federal tax credit of up to $1,500. Talk to your tax advisor for more information on this program.