Changes to Energy Efficiency Regulations from April 2018
From 1st April 2018, the Minimum Energy Efficiency Standards (MEES), which was introduced in March 2015, will come into effect for landlords and property owners with commercial property to let in the UK. From this date, all non-domestic properties will require an EPC rating that meets regulations. Commercial properties are given an Energy Performance Certificate (EPC) score from ‘A’ to ‘G’, ‘G’ being the worst score. The property will need to score a minimum of an ‘E’. It is estimated that 20% of non-domestic properties in the UK currently have a score of ‘F’ or ‘G’. From April, it will be unlawful to agree to a new lease for a commercial property with a rating of ‘F’ or ‘G’. Fines of up to £150,000 will be required for non-compliance.
This change is coming into effect in order to improve the energy efficiency of the most energy inefficient properties. It will also help to reduce CO2 emissions for all buildings to around zero by 2050. The built environment has a big impact on Greenhouse Gas Emissions and without this regulation, will affect the UK meeting its carbon reduction targets by 2020 and 2050.
Who does this change apply to?
- Buildings which are required to have an EPC rating – some buildings are not required to have this rating, such as industrial sites, workshops, non-residential agricultural buildings with a low energy demand, certain listed buildings, temporary properties and holiday lets.
- Landlords or property owners with tenancies of over 6 months.
- Buildings with an EPC under 10 years old.
The most obvious impact this change will have on landlords is the financial cost of upgrading non-compliant buildings and the loss of income if a building cannot be rented out. However, it provides the opportunity to increase rental prices due to improvements in energy efficiency.
