Using the z-transfer function technique, hourly energy performance of below grade building envelope components is determined. In particular, the technique is integrated with a state-of-the-art hourly whole building simulation program to predict the effect of indoor temperature setback and foundation insulation configuration on the hourly variation of crawlspace temperature and ground-coupled heat loss of a residential building. It is found that the indoor temperature setback in the house affects significantly both the crawlspace temperature and the foundation heat loss. Typically, it was found that the setback and the setup in house temperature increases the amplitude of the fluctuations of both the crawlspace temperature and the foundation heat loss. A simple correlation is provided to determine the effect of the temperature setback on the foundation heat loss.