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Measure up 4' on both walls where you'll be installing the paneling. This is the height of the paneling. Snap a chalk line between two points. Using a stud finder, find the studs and mark every one above the chalk line and on the baseboard. Use a piece of cardboard to create a template of the electrical outlet. You'll want to feed any wiring through the paneling before nailing it in place.
It’s a good idea to start on the wall that is the most plumb. To make a space look taller, install paneling vertically. Horizontal paneling will make the space look wider. Nail the paneling to the wall in every other groove. (Nailing in the grooves conceals the nail heads.) Be sure to measure for all the outlets and any cutouts that need to be made. Transfer the measurements to the paneling and make the appropriate cuts using the jigsaw.
Measure the top of the wall to see how much to rip the paneling ("ripping" means cutting wood with the grain). With the help of a friend, attach the top section of the paneling. Continue until all the paneling is finished. The addition of 1x2 trim will finish off the "crown molding" for the paneling. Run a dehumidifier after adding paneling in a basement to avoid moisture warping the boards. Consider the thickness of the paneling and the drywall, and get nails that are long enough to go through both. You'll also need longer screws to fasten the outlet covers back in place.
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