This paper outlines a methodological framework for the economic evaluation Of CO2 emissions abatement policies and measures in the residential sector, taking into consideration both economic and social costs/benefits. The approach includes two stages: first, the measures under consideration are evaluated on the basis of a cost effectiveness analysis, which takes into account only the related net financial costs, thus highlighting win-win actions (i.e. measures presenting an economic benefit for end users without the provision of any economic subsidies or other similar policies); and second, the measures are re-evaluated using an integrated cost benefit analysis (where both the private and external costs/benefits are taken into account). The economic performance of the measures examined incorporates the effects of a variety of parameters, such as the region's climate, size and age of buildings, etc., which significantly affect the resulting ranking. The implementation of this framework in the Greek residential sector identified and prioritized a significant emissions reduction potential, which could be achieved with win-win measures and/or interventions that present a net social benefit. Measures with negative economic cost but positive net social benefit for the majority of the buildings examined include: (i) regular inspection of central heating boilers, (ii) use of thermostats in central heating boilers, (iii) scaling of openings, (iv) installation of solar collectors for hot water etc. The monetization of environmental benefits is shown to provide a powerful tool for highlighting priority actions in the context of a climate change mitigation policy. (C) 2003 Elsevier Ltd. All tights reserved.