An EPC is essentially a guide to how efficiently a property uses energy, the cost of running the property, and recommendations on how to potentially improve the energy efficiency of the property.
An EPC is required whenever a property is built, sold, or rented. New owners or tenants should have access to the property EPC before any agreement is reached.
EPCs currently give the property a rating from A to G depending on its energy efficiency. A is highest level of efficiency with G being the lowest. EPCs are currently applicable for 10 years before another inspection by an accredited assessor is required.
In March of 2015, the Secretary of State for Energy and Climate Change approved new energy efficiency regulations. These regulations are due to bring about a number of new standards, one of which is the Minimum Energy Efficiency Standards (MEES).
MEES is a new law that will introduce a new minimum energy efficiency standard for commercial buildings. The new MEES law will introduce a minimum standard of E, meaning that buildings cannot be rented if they are rated as an F or G on the scale. The law will come into effect for new leases and renewals from April 1, 2018. From April 1 2023, this will apply to all leases.
These new law changes come after a number of damning reports suggesting that a number of commercial and residential properties in the United Kingdom have extremely poor energy efficiency.
Analysis of EU data in 2013 publicized that homes in the United Kingdom are some of the most expensive to heat in Europe because of poor insulation and general low standard of maintenance.
More recently, a 2016 report from the Association for the Conservation of Energy revealed that over one-third of non-domestic buildings in London were rated E or lower on the EPC scale.
In London, 37% of buildings were given this grade, in comparison to just 34% that achieved a rating of C or higher. Perhaps most troublingly for England’s capital is the 18,000 non-domestic buildings that rated F or G.
While it is vital for landlords, investors, developers, and lenders to know the law, it is even more essential that everyone is aware of how to adhere to the new law and the changes that can be implemented to ensure that energy efficiency ratings in properties remain an E or above.
Initially, it is extremely important that you know if any of your buildings are at risk of falling below the accepted level of the new standards. Furthermore, it is indispensable that you analyse your existing leases. Requirements like rent reviews may not have been drafted with the new MEES law in mind. You should also complete any work that needs doing to your properties well in advance of the legal changes in April of next year. Getting these changes fixed early will ensure that you avoid the inevitably higher costs later on, whilst also adding early value to your properties.
Improving energy efficiency does not require a major overhaul. There are some simple alterations and additions will ensure that a property jumps up its EPC ratings immediately.
Jason McGrinder is a qualified domestic and non domestic energy assessor and also director of EPC For You. He started in the fledgling energy efficiency sector in 2008 when based in London and trained with Habitus Surveyors and has since then started his own company that offers varying energy survey services for a growing UK client base.
This blog originally appeared on www.homeenergy.org.