Energy Performance Certificates (EPC) are changing in England and Wales
19 January 2023
Did you know that Energy Performance Certificates (EPC) are changing in England and Wales?
Is your Energy Performance Certificate (EPC) lower than an E rating? If so read below.
An EPC is a certificate that is issued by an assessor which shows information about the energy efficiency of a property, which is valid for 10 years.
EPC’s are graded between A – G. Grade A is the highest level of efficiency and G being the least efficient. Typically an EPC is used by prospective buyers and tenants to see how the energy efficiency affects the costs of their energy bills for that specific property.
Generally, nearly all commercial properties and any building that is not a dwelling requires an EPC. The EPC regulations apply to an estimated 85% of non-domestic rented buildings. While 61% of commercial properties in England and Wales are rented, 37.5% of emissions produced come from these rented properties.
Since April 2018, the minimum EPC rating for any new leases of commercial property stands at E, with exceptions. These exceptions include improvement works that cannot be carried out or are not economically viable.
All exemptions must be registered with GOV.UK and are valid from 6 months to 5 years. Listed buildings also have exemptions only if the minimum energy efficiency standard cannot be achieved if the proposed works are incompatible with planning permissions and building regulations.
However, to tackle climate change and to reduce emissions by improving the minimum energy efficiency standards, the Government has announced a target to implement a “Net Zero” by 2050.
To start the Net Zero implementations the Government have stated that from the 1st of April 2023, there will be a requirement of a minimum E rating for all existing leases under the new Minimum Energy Efficiency Standards Regulations.
To comply with the new regulations, 95% of commercial landlords will need to make improvements to their properties. The most likely upgrades commercial landlords will need to undertake will include installing insulation, replacing windows with double glazing and upgrading their boilers to new energy efficient ones.
Therefore, it will be unlawful for landlords to let or continue to let a commercial property with an EPC rating of less than E. The only exception is if the term of the lease is less than 6 months or over 99 years.
Almost 25% of commercial landlords do not know about the change, with a further 10% of landlords wanting to sell their inefficient properties.
If you do not comply with the new regulations, trading standards officers can issue penalty charge notices of 12.5% of the rateable value of the building or a minimum penalty of £500.00 to a maximum of £5,000.00 for lack of commercial EPC.
If you are unsure of your EPC rating for your commercial property, please visit https://www.gov.uk/find-energy-certificate or contact our Commercial Property Department on 01267 239000.
The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.