The house is now wrapped in a wool blanket. Not really wool, but pretty darn close. The exterior applied insulation is a 1.5" thick semi-rigid panel by Roxul, comprised of volcanic rock and slag (a by product of steel manufacturing). Also know as Rock Wool, it is literaly made of rock. It is insect proof, fire proof, water proof. It can get get wet and will dry out just like a wool sweater, without losing any of its insulative qualities.
I can't say enough good things about this product. It's environmentally friendly, perfect for the application, and absolutely simple to install. Anyone could do it. I cut the panels as needed with a snap off razor blade. I used the same blade for the entire project, never changed it once! I had thought I'd be going through blades fast since it is after all stone.
We've started to apply some of the siding as you can see the black stripe down at the bottom, but winter's grip has taken hold and we are going to wait for spring or a warm spell to finish it off. I'm not concerened as the house is super tight with the Zip System sheathing and is well protected by the Roxul!
Installing the Roxul is so easy. It comes in 2' x 4' sheets so they are easy to handle. Several people have commented on this small size wondering why not typical 4'x8'. They would be quite heavy at that size and very unwieldy as the panels easily bend and break. Not too easily, but if you drop one 10' it's likely to get bent up. Never happened to me, really.
Precut them on the ground to fit around windows. At the ends just let them overhang and trim to fit. 1-2 cap nails are sufficient to hold them in place, as the furring strips for the siding will ultimately secure them. One thing I wouldn't do, is put the joints of the Roxul on the stud lines. When you screw in the furring strips, the Roxul will compress and it is much more compressive on the ends than in the middle. Getting the furring strips plumb so the siding is flat will take some work with string lines and levels, as the Roxul does compress easily.