Posted Thursday 26th October 2023
Energy Performance Certificates (EPC) tell you how energy efficient a building is and EPC bands run from A to G, with A being the most energy efficient and G the least. The more energy efficient your property is, the lower your energy costs will be and the better your impact on the environment.
As soon as a building is in the process of being offered for sale or rent, it is the responsibility of the seller or landlord to make available free of charge an EPC to any prospective buyer or tenant.
It is no longer sufficient for a landlord to simply have an EPC for a rental property, regardless of the rating. The Minimum Energy Efficiency Standards (MEES) sets out the minimum energy efficiency levels for privately rented properties and it is crucial that landlords are aware of the requirements.
Residential property
Since 1 April 2020, landlords can no longer let, or continue to let, properties covered by the MEES regulations if they have an EPC rating below E, unless there is a valid exemption in place.
Commercial property
From 1 April 2023, it is unlawful to continue to let a property with an EPC rating below E, even if the lease was granted prior to the MEES Regulations coming into force in 2018.
If a landlord is currently planning to let a property with an EPC rating of F or G, they need to improve the property’s rating to E, or register an exemption, before they enter into a new tenancy. For all existing tenancies, landlords must improve the property’s rating to E immediately, or register an exemption.
These standards are enforced by the Local Weights and Measures Authorities. If the authority believes a landlord has failed to fulfil their obligations under the Regulations, they can serve the landlord with a compliance notice. If a breach is confirmed, the landlord may receive a financial penalty based on the rateable value of the property, which can be between £10,000 – £150,000 per breach.
The future
In 2021, the Government announced plans to increase the minimum MEES rating to C for residential properties by either 2025 or 2028 (depending on the type of property) and for commercial properties by 2027. The plans were highly controversial, with environmentalists pushing for more to be done to improve the energy efficiency of buildings and landlords facing huge costs in order to bring their properties up to standard.
However, during a speech last month, Prime Minister Rishi Sunak announced that these plans have now been scrapped by the Government. In his statement, Mr Sunak said “while we will continue to subsidise energy efficiency, we’ll never force any household to do it”. This will be a huge relief for many landlords across the country.
Whilst this may offer some comfort to landlords for the time being, Mr Sunak has confirmed that the Government is committed to meeting its net zero emissions target by 2050, so there is certainly the potential for more changes in the rental space.
If you are unsure on whether your property falls within the scope of the current MEES Regulations, you should contact our Property Litigation team for further advice.
This article is for reference purposes only. It does not constitute legal advice and should not be relied upon as such. Specific legal advice about your specific circumstances should always be sought separately before taking or deciding not to take any action.
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