Cost Reduction Lab

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MassCEC / High Performance Buildings / Funding / Cost Reduction Lab

The Challenge

Small residential buildings account for over 60% of Massachusetts buildings’ greenhouse gas emissions. Decarbonizing small residential buildings is often hindered by high costs and fragmented delivery. For example, electrification can trigger expensive electrical upgrades, projects are rarely coordinated to capture whole project savings, geothermal and heat pump deployments remain costly due to drilling, design, and lack of standardization, and high upfront and soft costs for solar further slow adoption, despite declining equipment prices. The Cost Reduction Lab will support selected applicants to demonstrate, document, and disseminate novel cost reduction approaches for decarbonizing existing small residential buildings to address these challenges.

About the Cost Reduction Lab

The Cost Reduction Lab is seeking proposals for projects that demonstrate solutions to lower the cost of decarbonization in existing small residential buildings (1-4 units) in Massachusetts, with a focus on business models, market approaches, and technologies that can drive cost reductions.

The Cost Reduction Lab aims to identify and publicly disseminate open-source solutions that are freely available for implementation and whose benefits are not limited due to their proprietary nature or status as intellectual property.

Applicants are expected to propose solutions to a Problem Statement with a Demonstration Project to test the effectiveness of the proposed solution.

The following are example Problem Statements applicants may choose to provide solutions to:

Electrical Upgrade Triggers: Reducing need for costly panel upgrades with load management solutions.
Lack of Project Coordination: Leveraging complementary projects to capture whole-project savings.
Geothermal Cost Barriers: Reduce costs with new business models, drilling tech, financing innovation.
Non-Standardized Heat Pump Installation: Streamlining heat pump design and deployment.
High Upfront Costs to Solar: Reducing soft costs and accelerating adoption.

Cost Reduction Lab - Flyer

Who's Eligible

This program is open to applicants who will demonstrate cost savings of a decarbonization solution, including, but not limited to:

Home performance contractors
Technology installers
Technology providers
Academics
Consultants

Proposals must be for projects that will demonstrate decarbonization cost reductions applicable to Massachusetts.

Connect

We encourages applicants to develop new partnerships to brainstorm ideas, build industry connections, and eventually collaborate as project partners.

Join our collaboration platform to discuss potential projects with other interested applicants. Please note, conversations on our platform are public record. For private conversations, please connect outside of our platform with potential collaborators.

The Cost Reduction Lab team holds office hours on Tuesdays from 2-3pm through the application period. Advance sign-up is required.

Open

Award Potential

$2.5M total funding
Up to $500k per grantee

Application Deadline

May 8, 2026 at 11:59 PM

Apply

Questions? Contact

Funding Schedule

Process Step	Timing
Release of RFP	March 20, 2026
Informational Webinar	March 31, 2026 at 12 PM ET
Questions Due to MassCEC via Email to buildings@masscec.com	April 24, 2026
Questions with Answers Posted to Program Webpage	May 1, 2026
Proposals Due	May 8, 2026 at 11:59 PM ET
Interviews of Top Applicants (If Applicable)	Late May-Early June
Notification of Award	July 2026

Apply

Application Process

The response to the RFP should be submitted via JotForm.

Before submitting an application, applicants must review the following RFP attachments.

Attachment A: Authorized Applicant’s Signature and Acceptance Form (sign and upload to JotForm)
Attachment B: Sample Grant Agreement (for reference only)

If you need assistance filling out the JotForm application, please email buildings@masscec.com. "Cost Reduction Lab RFP Application" and Applicant name should appear in the email subject line.

Applicants may submit multiple separate proposals if the Projects are distinctly different from each other. Applicants may be awarded multiple grants at the discretion of MassCEC.

Application Materials

Cost Reduction Lab RFP

Attachment A - Authorized applicant signature and acceptance

Attachment B - Sample Agreement

FOR REFERENCE ONLY - Application Form

Cost Reduction Lab Pre-Application Webinar

MassCEC hosted an informational on March 31, 2026 from 12:00 PM - 1:00 PM EST. The webinar described the core challenge of decarbonizing 1-4 unit residential buildings, and provides funding details, application expectations, demonstration requirements, emphasis on scalability and adoption, and program application schedule.

Download webinar slides

Frequently Asked Questions

What does small residential mean?

"Small residential" refers to single family buildings and small multifamily buildings up to 4 units.

Can townhome type buildings with shared walls (block length) still count as 1-4 unit building?

Generally, townhomes with a shared wall are eligible as single-family buildings. If you have questions about a particular situation or approach, please reach out to buildings@masscec.com.

Can the funding be used for IUI funding toward the utility?

No.

I have a portfolio of 1-4 family buildings that need decarb work, can this funding be used for that?

A portfolio of 1-4 family buildings may be used as demonstration sites for a project, however, this funding opportunity is for business models, market approaches, and technologies that can drive cost reductions, not for direct decarbonization work on buildings. More details about eligible projects can be found in Section 4 of the RFP.

Will the funds be available solely for existing buildings or can we use this project for new construction projects as well?

Funds are available for demonstration projects that reduce the cost of decarbonizing existing buildings. More details about eligible projects can be found in Section 4 of the RFP.

FAQs continues...

Our team has a decarbonization cost reduction proposal in mind that does not fall within one of the five stated priority problem areas. Can you please share how much additional weight is given to proposals that fall within one of the stated problem areas during the evaluation process?

Additional weight is not given to proposals that fall into one of the stated problem areas. Problem statements listed in Section 5 of the RFP are examples.

Can an entity participate in applications with multiple teams, or is each entity limited to a certain number of applications?

Applicants may submit multiple separate proposals if the Projects are distinctly different from each other. Applicants may be awarded multiple grants at the discretion of MassCEC.

We already have an active grant with MassCEC – can we still apply for this funding?

Applicants with active MassCEC grants may apply for funding through the Cost Reduction Lab provided their proposed demonstration project is distinct from work being done through their existing grant. Funding requested should not be duplicative of any costs already being covered by the existing grant. Applicants should disclose their participation in any other MassCEC programs in their application.

I realize the demonstration sites need to be in MA. Does the technology or business model have to be MA based?

The proposed technology or business model does not necessarily have to be MA-based; however, proposals will be evaluated, in part, by relevance in the context of the Massachusetts market and potential for cost reduction in Massachusetts specifically, as further described in Section 9 of the RFP.

Can there be a monetized open source solution?

Monetized open source solutions may be proposed, and will be evaluated based on the evaluation criteria listed in Section 9 of the RFP, including the proposed solution's ability to scale in the Massachusetts market.

MassCEC / High Performance Buildings / Funding / Cost Reduction Lab