The Sustainable Urbanism Initiative Net-Zero Energy(NZE) Townhouse in Toronto is simulated in TRNSYS 16. Theincorporation of phase change material (PCM) with Type 204into the building envelope is modeled. Simulations areconducted for the summer and winter months to determine thepotential reductions in the average hourly temperature fluctuations(AHTF). Sensitivity analysis is conducted for thermalconductivity and melting range of the PCM. Ten millimeters(0.4") PCM is applied as one layer inside the building envelope.The best melting range and thermal conductivity for atypical PCM are sought. To do this, other physical and thermalspecifications of the PCM are fixed. All simulations considerToronto-716240 weather conditions. Although indoor airtemperature swing is neither much sensitive to the meltingrange nor to the thermal conductivity, it is lower when the PCMis present. AHTF reduction of up to16% is found in mezzaninedue to the PCM additions to the building envelope.