<p>Municipal housing companies have been recognised for their potential in taking on a leadership role in terms of energy efficiency in buildings, raising the question of what the transaction cost barriers are in these companies’ internal operations for undertaking energy efficiency measures. In this study, we thus explore transaction costs barriers in municipal housing companies in Sweden. Data on qualitative transaction cost barriers in the planning and implementation of energy-efficiency renovations was collected through interviews with six companies, two of which were also able to present data and quantitative transaction costs. The study illustrates the characteristics of transaction costs barriers, and the results indicate these barriers result in conventional energy efficiency technologies and measures rather than more innovative measures. This is due to asset specificity, uncertainty, and bounded rationality. The study indicates that learning can be essential in reducing transaction cost barriers, this through capacity building, demonstration projects and interaction among different types of actors. Feedback and structured learning, as in demonstration projects, will be essential in reducing transaction costs and supporting the implementation of new (innovative) energy-efficiency measures. The study specifically highlights the need for local initiatives supporting (local) learning, by strengthening the role of municipalities and municipal housing companies.</p>