(Adapted from http://www.ehow.com/how_4619623_make-evaporated-milk.html)

Instructions.Things You’ll Need:
Milk, whole

1 Determine how much evaporated milk you will need for your recipe. If your recipe calls for “cans” then use this guide: A 5 oz can of evaporated milk is 5/8 cup and a 12 oz can is 1-1/2 cups of evaporated milk.

2 Milk Use 2-1/4 cups of regular milk for every cup of desired evaporated milk.

3 Therefore, if you need a 12 oz can of evaporated milk, then start with 3-3/8 cups of milk.

4 If you need the 5 oz can, you can start with 1-1/4 cups plus 2-1/2 tablespoons of milk and evaporate that down to 5/8 cup. However, I’d recommend starting with 2-1/4 cups, evaporating it down to 1 cup, and then measuring out 5/8 cup and perhaps using the rest for another recipe. It can be difficult to regulate the temperature for a quantity of milk this small.

5 Medium sized, heavy saucepanYour pan should be slightly heavy and medium-sized. Spray it lightly with non-stick spray.

6 Pour in the regular milk. Set temp to medium and heat for a few moments, stirring. As soon as the milk starts to steam (NOT simmer or boil), then adjust the heat down so that the milk continues to steam. Do not allow to boil. Boiling will cause the milk to curdle and may even scorch the bottom of the pan. (You will not be a happy dishwasher if you have to scrape scorched milk from the pan.)

7 Keep the temperature low (on my gas stove, I use the smallest burner and set it to the lowest setting.) Let the milk steam (ie: evaporate) until it reaches the target measurement. For example, if you started with 2-1/4 cups, then let it steam until it reaches 1 cup. Stir occasionally. A film will develop now and then; just stir it in (or skim it off if preferred)

8 Heat until you reach the target measurementI keep a large measuring cup out and when I think the milk is done, I pour it into the cup. If it is has evaporated to the right measurement, then I’m done. If there is still too much milk, just pour it back in the pan and let it continue to steam.

9 The milk will thicken as it evaporates. The process will take 1 – 3 hours, depending on how high you set the temperature and the volume of milk you are evaporating.

10 Pour into a clean jarPour finished milk into a clean jar or other container that can be covered with wrap or sealed. Store in the refrigerator until use. This will stay fresh in the refrigerator for 3 – 5 days.

11 The cost to make 12 oz of evaporated milk is approximately $.70, assuming a gallon of milk is $3.29. (In my area, a purchased 12 oz can will usually cost in the range of $.99 to $1.49)

You should substitute 2% milk or skim milk if your recipe calls for low-fat (2%) or fat-free (skim) evaporated milk..The 2% milk substitute works well in almost all recipes, even the ones that call for whole evaporated milk.
If you are in a real hurry and you have powdered milk on hand, you can use this substitute for fat-free evaporated milk: To make a 12 oz can equivalent, start with 1 cup of powdered milk. Add 1-1/3 cups of cool water. Shake or stir vigorously. Use immediately or store in refrigerator..You may also make whole milk equivalent from powdered milk: For a 12 oz can, make the above (1-1/3 cups water and 1 cup powdered milk). Add 2 Tbsp of melted butter or canola oil and shake, shake, shake. This will be somewhat difficult to mix and should be used immediately..Neither of the above powdered milk recipes will give you the lovely color and taste of evaporating the milk yourself, but they will do quite well in a pinch..