A green building competition, to be known as the Energy Free Home Challenge (EFHC), is scheduled to be opened to teams around the world in 2010. This competition will encourage both design innovation and cost reduction, by requiring design entries to meet 'zero net energy' and 'zero net cost' criteria. For the purposes of this competition, a 'zero net energy' home produces at least as much energy as it purchases over the course of a year, regardless of the time and form of the energy (e.g., electricity, heat, or fuel) consumed or produced. A 'zero net cost' home is no more expensive than a traditional home of comparable size and comfort, when evaluated over the course of a 30-year mortgage. In other words, the 'green premium' must have a payback period less than 30 years, based on the value of energy saved. The overarching goal of the competition is to develop affordable, high-performance homes that can be mass-produced at a large scale, and are able to meet occupant needs in harsh climates (as can be found where the competition will be held in Illinois). This report outlines the goals of the competition, and gauges their feasibility using both modeling results and published data. To ensure that the established rules are challenging, yet reasonable, this report seeks to refine the competition goals after exploring their feasibility through case studies, cost projections, and energy modeling. The authors of this report conducted a survey of the most progressive home energy-efficiency practices expected to appear in competition design submittals. In Appendix A, a summary can be found of recent projects throughout the United States, Canada, Germany, Switzerland, Sweden and Japan, where some of the most progressive technologies have been implemented. As with past energy efficient home projects, EFHC competitors will incorporate a multitude of energy efficiency measures into their home designs. The authors believe that the cost of electricity generated by home generation technologies will continue to exceed the price of US grid electricity in almost all locations. Strategies to minimize whole-house energy demand generally involve some combination of the following measures: optimization of surface (area) to volume ratio; optimization of solar orientation; reduction of envelope loads; systems-based engineering of high efficiency HVAC components, and on-site power generation. A 'Base Case' home energy model was constructed, to enable the team to quantitatively evaluate the merits of various home energy efficiency measures. This Base Case home was designed to have an energy use profile typical of most newly constructed homes in the Champaign-Urbana, Illinois area, where the competition is scheduled to be held. The model was created with the EnergyGauge USA software package, a front-end for the DOE-2 building energy simulation tool; the home is a 2,000 square foot, two-story building with an unconditioned basement, gas heating, a gas hot-water heater, and a family of four. The model specifies the most significant details of a home that can impact its energy use, including location, insulation values, air leakage, heating/cooling systems, lighting, major appliances, hot water use, and other plug loads. EFHC contestants and judges should pay special attention to the Base Case model's defined 'service characteristics' of home amenities such as lighting and appliances. For example, a typical home refrigerator is assumed to have a built-in freezer, automatic (not manual) defrost, and an interior volume of 26 cubic feet. The Base Case home model is described in more detail in Section IV and Appendix B.