The latest stage of the Minimum Energy Efficiency Standards was implemented on 1 April 2020, making it unlawful for landlords to continue domestic residential tenancies where the property has a rating of F or G on its Energy Performance Certificate (EPC).
Two years ago, the first implementation stage introduced the requirement for an E rating or above for all new tenancies granted. Now, that is extended to all existing domestic tenancies and in 2023, it will be extended to all commercial tenancies.
Where landlords continue to let domestic property which fails to meet a minimum E Energy Efficiency Standards rating, enforcement action and fines of up to £5,000 could follow. While there has been little enforcement since 2018, that has been attributed to the difficulty of identifying whether a property was subject to a ‘new’ or ‘existing’ tenancy. Still, those in the industry say that enforcement will likely be tackled now that all property let under a residential tenancy must comply.
Property lawyer, Peter Wright, explains:
“All domestic landlords need to check their property portfolios and undertake any work that is needed to increase the EPC rating or to register an exemption. There is some funding support available for landlords, and a cap on how much has to be spent, so it’s worth checking out the government’s information and guidance on how to meet the regulations.”
Exemptions may be provided where a landlord has undertaken measures recommended in the EPC report up to a cap of £3,500, including VAT, but the property still does not meet the Energy Efficiency Standards E rating. Another route to exemption is where any recommended upgrade option would exceed £3,500. Any exemption will last for five years, after which the property must once more be upgraded.
“Properties listed for historic purposes are generally thought to be exempt, although it’s not entirely clear from the EU Regulations and the Government’s guidance. These say that energy performance compliance may not be required if the necessary works would unacceptably alter the character or appearance of a building, but do not provide an automatic exemption. Owners are well advised to get an EPC and then ask their local conservation officer to confirm where they stand if the property does not meet the new requirements.”
The Regulations also allow the tenant to undertake energy improvements if the landlord consents, even when there are restrictions on making improvements in the lease. If the tenant applies for consent, the landlord may only refuse on reasonable grounds.
Call Peter Wright today with questions about your property’s rating or the latest energy efficiency standards.
Note: This is not legal advice; it provides information of general interest about current legal issues.