diff --git a/cmd/cmd.js b/cmd/cmd.js
index c565adcf7..57b68e7c9 100644
--- a/cmd/cmd.js
+++ b/cmd/cmd.js
@@ -1,8 +1,30 @@
 const program = require('commander');
 const EmbarkController = require('./cmd_controller.js');
 const i18n = require('../lib/core/i18n/i18n.js');
+const utils = require('../lib/utils/utils.js');
+
 let embark = new EmbarkController;
 
+// set PWD to process.cwd() since Windows doesn't have a value for PWD
+if (!process.env.PWD) {
+  process.env.PWD = process.cwd();
+}
+
+// set the anchor for embark's fs.dappPath()
+if (!process.env.DAPP_PATH) {
+  process.env.DAPP_PATH = process.env.PWD;
+}
+
+// set the anchor for embark's fs.embarkPath()
+if (!process.env.EMBARK_PATH) {
+  process.env.EMBARK_PATH = utils.joinPath(__dirname, '..');
+}
+
+// enable lookup of embark's own node_modules from within dapp scripts
+process.env.NODE_PATH = utils.joinPath(process.env.EMBARK_PATH, 'node_modules')
+  + (process.platform === 'win32' ? ';' : ':')
+  + (process.env.NODE_PATH || '');
+
 class Cmd {
   constructor() {
     program.version(embark.version);
diff --git a/cmd/cmd_controller.js b/cmd/cmd_controller.js
index 6db6c8b7c..5865526a5 100644
--- a/cmd/cmd_controller.js
+++ b/cmd/cmd_controller.js
@@ -5,11 +5,6 @@ require('colors');
 
 let version = require('../package.json').version;
 
-// Set PWD to CWD since Windows doesn't have a value for PWD
-if (!process.env.PWD) {
-  process.env.PWD = process.cwd();
-}
-
 class EmbarkController {
 
   constructor(options) {