Life-cycle incremental cost-benefit model for passive buildings and a case study in Zhejiang Province, China

Passive buildings (PBs) offer substantial advantages in reducing carbon emissions and improving energy efficiency, making their promotion a strategic priority for China’s carbon goals. However, high upfront costs, unclear long-term benefits, and long payback periods hinder adoption. This study develops a Life-Cycle Incremental Cost-Benefit Model (LCICBM) covering design, construction, and operation. The model quantifies and monetizes economic, environmental, and social benefits. A dynamic evaluation framework using ENPV and EIRR is proposed. The model is validated using the first PHI-certified passive residential district in Zhejiang, China. Results confirm economic feasibility: ENPV is positive (6.67 million CNY), EIRR (8.5%) exceeds the social discount rate (8%), and the payback period (43 years) is within the 50-year design life. Sensitivity analysis shows electricity price as the most influential factor, yet the project remains robust under most pessimistic scenarios. This research provides a practical tool for PB economic evaluation, supporting policy, investment, and technical decisions for large-scale PB deployment in China and beyond.