Buildings have significant ecological footprint. But they could also be sources of energy savings. This potential of buildings, however, remains untapped. Andhra Pradesh is among the first Indian states to adopt a mandatory building energy policy. This paper analyses the reasons for the state’s success. It argues that Andhra Pradesh’s success owes to the state identifying the constraints of the sector’s underlying institutional and technical arrangements, as opposed to following a top-down policymaking approach. These constraints were addressed during regulatory design through a participatory process involving state and non-state actors. As a result, local solutions have bridged the gap between existing structures and policy goals. In drawing from Andhra Pradesh’s example, this paper offers lessons for ways to overcome the gridlock in building energy efficiency and the need to embed policy goals in their broader implementation context.