A study has been performed to develop cost benefit data to be used by a local electric utility in defining a rebate program to encourage energy efficient construction in the Desert Southwest region of the USA. Several potential efficiency upgrades for production homes in the region were identified and an evaluation of each building component was performed using building energy simulation software. A model home developed in Las Vegas was used to calibrate the numerical model and was considered as a basis for further study. The validated building models were then used to predict the annual energy savings and payback periods for various upgrades. In all cases, comparisons were made to code-built houses with the same general overall characteristics. Useful life of most of these upgrades far exceeds their payback periods. It is found that a typical house, with the cost-effective upgrades installed, consumed 42.5% less annual energy compared to a home built to code. A 3.19 kWp PV system installed on the south-facing roof of the home can generate 5982 kWh annually, making it a net-zero (electrical) energy home. PV systems in Las Vegas have encouraging benefit cost ratios when federal and state rebates are considered. (C) 2011 Elsevier Ltd. All rights reserved.