A wall system includes a first wall section a structural portion, such as concrete block construction. A second wall section mounts to the first wall section and includes insulating panels connected in an edge to edge relationship to form a continuous insulating layer. A third wall section of conventional finishing materials such as drywall, paneling or exterior finish layer mounts over the second wall section. Each of the insulating panels includes mounting elements at least partially embedded therein that provide for mounting the panels to the first layer and for mounting the third wall section to the second wall section. Each of the panels is lightweight and may be water impervious. The panels have ridges formed therein that define channels for routing wiring and other components. The panels also include complementary edges and complementary alignment features.