Dynamic address compression schemes that exploit address locality can help reduce both address bus energy and cost simultaneously with only a small performance penalty. In this work, we investigate two such schemes and determine their optimal parameters that result in the highest area/cost reductions and least performance penalty for various address buses (both on- and off-chip) in current systems. For addresses compressed with these schemes, we study energy reduction of buses in current and future nanometer technology nodes. Our study uses the cycle-accurate simulator for the Alpha 21264 processor called sim-alpha for performance estimation and accurate interconnect models considering inter-wire capacitances for bus energy estimation. Results show that using address compression will result in only small performance overheads (less than 1% for compressing a 38-bit bus to 14 bits) and reduce bus energy dissipation by as much as 13% when applied to on-chip buses in current technologies.