- Basements can account for about 20 percent of a home’s total heat loss. This is due to the large, uninsulated surface area both above and below grade level. Contrary to popular opinion, earth is a poor insulator. There is also a lot of air leakage through basement windows and penetrations (including cracks in these areas) and at the top of the foundation wall (sill area). Many basements have little or no insulation, so this means there is much potential for improvement. Insulating can often be tied in with other repairs or renovation work such as waterproofing, radon remediation or finishing the basement.