So some information first. We have a chalet style house and the basement is half in ground and half out. The back wall where the heater, water heater, pipes, etc is under grade. The two side walls go from under grade to fully exposed and the front wall is fully exposed. The basement is not insulated at all and I plan on fixing that since its a pain to heat the house since the floors on the first floor are pretty cold in the winter. I plan on finishing the basement, but I want to get it insulated first and then slowly finish it. My plan is leaving the back ~8' unfinished where the heater and water heater are. I am going to put 2" rigid foam insulation on the walls, floor, and rim joists in the finished portion of the basement. I have those details worked out, but I am not sure what do in this unfinished area. I would like to do the same thing and I can move or work around just about everything except the furnace. I do not want to mess around trying to move it out from the wall to get insulation behind it so what are my options?
I really want to insulate the unfinished space in the same way, but I can't figure out the best way to do it. If I do not insulate it I guess I need a vapor barrier between the finished and unfinished space? I read that I need to let the furnace have access to air and thus if I have a vent from the unfinished to finished space I would assume that eliminates the benefits of the vapor barrier?
I am so confused!