This paper addresses the issue of recent changes in building construction regulations in energy-starved Dhaka. With a predicted exponential population increase in this extremely dense city, the demand for new buildings and fresh energy requirements is sharply rising. Bangladesh is also listed among those most affected by climate change. Recognising the role of building regulations in shaping the built environment, the regulations have been revised. The new regulations limit density and specify Floor Area Ratio (FAR) values for various site conditions and functions. It is asserted that these changed regulations will improve built environment, allowing greater scope for passive design approaches and lower energy consumption. In this paper, in order to demonstrate environmental improvement, an example plot, with design according to the new regulations, has been cited. This paper investigates improvement under the new regulations, comparing them with development that would be generated under the older regulations. Scope for further improvement is identified aiming towards passive energy design and greater energy efficiency in residential buildings.