This report presents a unified method of hourly simulation of a building and analysis of performance data. The method is called Primary and Secondary Terms Analysis and Renormalization (PSTAR). In the PSTAR method, renormalized parameters are introduced for the primary terms such that the renormalized energy balance equation is best satisfied in the least squares sense, hence, the name PSTAR. PSTAR allows extraction of building characteristics from short-term tests on a small number of data channels. These can be used for long-term performance prediction (''ratings''), diagnostics, and control of heating, ventilating, and air conditioning systems (HVAC), comparison of design versus actual performance, etc. By combining realistic building models, simple test procedures, and analysis involving linear equations, PSTAR provides a powerful tool for analyzing building energy as well as testing and monitoring. It forms the basis for the Short-Term Energy Monitoring (STEM) project at SERI.