Report cover: Accelerating Residential Building Decarbonization: Market Guidance to Scale Zero-Carbon-Aligned Buildings.

Decarbonizing our nation’s building stock by 2050 to help avoid a climate catastrophe—and also address a growing affordable housing crisis—is not going to be easy. Two new reports from the Advanced Building Construction (ABC) Initiative aim to make decarbonization more accessible and affordable by providing guidance for industrializing new building construction and retrofits, such as by standardizing and prefabricating components.

More than a third of U.S. greenhouse gas emissions are attributable to buildings. Meanwhile, around a third of homeowners and half of renters spend more than 30 percent of their income on housing. For those reasons, it is important to find ways to increase the supply of affordable housing while simultaneously decreasing environmental impact. 

New, industrialized approaches to constructing and retrofitting buildings are imperative to achieve the speed and scale necessary to meet national building decarbonization goals. These approaches include modernizing manufacturing and installation practices to optimize construction through techniques such as prefabrication, standardized or repeatable elements, automation, digital tools, and integrated workflows. The ABC Initiative, led by the Department of Energy’s (DOE’s) Building Technologies Office (BTO), focuses on accelerating the use of industrialized methods by supporting technology and process innovations, engaging key stakeholders, and developing business models that streamline production. 

Industrialized strategies for building construction and retrofits are applicable across all building types. They also have the potential to play a particularly significant role in addressing affordable housing challenges, by enabling speedy construction of new, high-quality, low-carbon affordable housing and by transforming existing affordable housing into resilient, comfortable buildings with lower energy bills. The ABC Initiative’s innovative approach to building upgrades—including panelized wall systems, exterior retrofit techniques, and advanced air-leak detection—increase energy efficiency while reducing installation time, cost, and disruption to occupants. Work done through the initiative will directly support the goals of DOE’s Affordable Home Energy Shot™, the eighth of the Department’s Energy Earthshots™.

Report cover: Industrializing Construction to Decarbonize Buildings, October 2023, with a photo behind it of a crane lifting a building piece at a construction site.

One of the new ABC reports, Accelerating Residential Building Decarbonization: Market Guidance to Scale Zero-Carbon-Aligned Buildings, provides key market stakeholders—product manufacturers, fabricators, contractors and installers, design professionals, owners, and real estate developers—with technical information and guidance on how to achieve zero carbon aligned new and existing residential buildings at scale. (The report defines “zero carbon aligned” as buildings that have no on-site fossil fuel use, have a low baseline power demand, obtain all energy from carbon-neutral sources, and can minimize grid impacts when needed, with the aim of a decarbonized U.S. building stock before 2050.) Published by the ABC Collaborative, the report provides technical performance guidance and estimated cost targets for new construction and retrofit packages for a priority set of residential building segments.

In the new construction market, building energy codes and building performance standards are targeting zero energy and carbon objectives; however, current codes and standards are limited by current technologies, and continued advancement is needed to achieve the Biden-Harris Administration’s goal of a net-zero emissions economy by 2050. Industrialized ABC approaches can help speed the deployment of zero carbon new construction, accelerating technologies which achieve greater efficiency while simultaneously minimizing cost, and providing significant business opportunities for the sector. 

For the retrofit housing market, the report presents building upgrade needs by state and climate zone and assigns four retrofit packages to modernize housing to be zero carbon aligned. Two complementary tools are available to assist homeowners and professionals in prioritizing upgrades for zero carbon alignment and streamlining workflows—DOE’s Retrofit Decision Tool and Buildxact’s energy upgrade project tool for contractors, the latter of which includes pre-populated information corresponding to recommendations from the DOE tool. 

The Market Guidance report notes that around 32 percent of housing only needs high-efficiency, all-electric equipment swap-outs, plus minor updates such as LED lighting, to become zero carbon aligned. This means that industry can accelerate the deployment of market-ready solutions for these simpler retrofits while also continuing the research, design, and demonstration of new technologies and approaches for more comprehensive retrofits—such as for the 60 percent of U.S. housing that requires building envelope upgrades in addition to electrified equipment and appliances. This represents a massive opportunity for industrialized approaches to improve the design and delivery of solutions that can address retrofit needs with speed and scale.

To enable those innovative solutions, the second new report—the ABC Research Opportunities Report, published by the Pacific Northwest National Laboratory—charts a path forward for a prioritized set of  innovations that  support the industrialization of low-carbon retrofits and new construction. The report covers industrialization of envelope improvements, industrialization of equipment installation, and enabling innovations such as design and tools, materials, and production and installation. For each category, the report highlights the current state, goals, and research opportunities with an eye to near-term development and research and deployment needs that will appreciably increase the speed, scale, and reach of decarbonization within the U.S. building stock. 

For envelope improvements, for example, the ABC Research Opportunities Report notes that current insulation and air-sealing methods are costly, disruptive, and not viable across climates and building types. Improved approaches are needed to assess existing conditions and to check for quality installation. Innovation goals include lowering insulation and air-sealing costs and reducing installation time to one to two days for single-family homes, one day for every eight to 10 apartment units, and eight days or less for small-to-medium commercial buildings.

The ABC Research Opportunities Report further outlines needed research and development investments through 2035. It will be periodically updated to reflect the latest industrialization advances, cost targets, and priority areas as technologies progress. Future updates to the report will be made in collaboration with BTO’s residential and commercial buildings technical teams and emerging technologies envelope team, as well as BTO’s National Emerging Technologies Collaborative (NETC) working group on envelope retrofits, whose goals align with those of the report. 

For more information on the ABC Initiative, visit For information on the ABC Collaborative, visit