In a misguided ambition to benefit the environment some severe restrictions are often put on the design process which can lead to a limited competition among the contractors that will result in higher prices and will obstruct the use of innovative solutions. Moreover the environmental objectives can be vague and lack the association to the quality of the object. The PQE method is intended to overcome these obstructions by providing an instrument for dynamic decision making in the tender evaluation process of buildings in which the production, quality and environment are balanced in a way that reflects the goals and prerequisites of the client. This can be done by applying cost functions that describe the performance of the building with respect to its durability, materials and environmental impact, health and comfort, moisture protection, sound insulation, energy usage and the depletion of resources. The dynamic cost parameters are then given a monetary value in accordance to the goals and values of the client, on the basis of which the client can choose the most economically feasible alternative that meets the functional requirements of the program as well as the demands of the national legislator and the local building authorities. The method is based on functional requirements, as opposed to prescribed solutions, since the aim has been to develop a tool that does not favour any particular actors or methods and thereby supports the use of inventive technical solutions. Paramount to the method is that the building be approached on a system level and from a life-cycle perspective. The choice of function categories aims to capture the factors with the greatest potential to contribute to sustainable development as well the most common areas of problems in the Swedish building industry.