By 2030, the Minimum Energy Efficiency Standards (MEES) will require all private rented homes to have an Energy Performance Certificate (EPC) rating of C or above. This is an increase from the current minimum requirement of an E rating.
What landlords need to know
In its consultation on reforms to the Energy Performance of Buildings regime, the government proposes using four metrics in arriving at ratings in the future, up from the single current metric of looking at energy cost. Other metrics could be used to provide an assessor with secondary information.
The metrics proposed are:
- Fabric performance, looking at the heat retention of a building’s walls, floor, roof, and windows
- Heating system, including the efficiency and carbon use of the system; fossil fuel heating, such as a gas boiler, will make it difficult to achieve a rating of C
- Smart readiness, assessing a home’s ability to use smart technology, for example, to control heating, solar pv, and battery energy storage
- Energy costs, calculated as an annual estimated figure
Secondary metrics include:
- Demand for energy, assessed by looking at current energy usage
- Carbon metric, with a snapshot of a building’s emissions
The government is aiming to deliver new EPCs from October 2026, although it admits that this date is ambitious. It is considering how to align the new-style EPC with the Home Energy Model, its methodology for assessing residential energy performance.
The Energy Efficiency Rating metric will be kept alongside the new metrics for comparison purposes to start with.
Non-residential properties will continue to be assessed by looking at a single metric, namely the Environmental Impact Rating, which measures a property’s carbon impact.
Action required now
Where landlords need to upgrade a property, they are likely to have less than four years to do so. Those who hold a real estate portfolio are advised to take action promptly to ensure compliance across the board and avoid increased penalties.
Options for potentially improving energy ratings include:
- Installing insulation, including in the loft and walls
- Replacing older boilers with modern boilers or heat pumps
- Replacing windows with double or triple-glazed options
- Draught-proofing where necessary
- Insulating water tanks and hot water pipes
- Replacing doors with better-insulated options
- Ensuring lighting is energy efficient
- Installing solar panels and storage batteries
The existing EPC will list recommendations for improvements.
Some grants exist for remedial work. It is also currently the case that where the cost of improvements is more than £3,500 (including VAT), a high cost exemption may be available. Three quotes for work must be provided by way of evidence, and all possible improvements up to the cost of £3,500 should be made.
What tenants need to know
The new rules are intended to improve property insulation and minimise heat loss, reducing energy bills. Landlords who fail to meet the required standards will face substantial fines.
If your property is currently rated as a D or lower, you can expect your landlord to carry out work to improve energy efficiency. This could include by insulating the property more effectively or replacing the heating system.
Where a landlord fails in their obligations, a tenant will be able to report them to the local authority, which will have increased powers of enforcement.
How 3CS can help
If you need to speak to an experienced landlord and tenant solicitor, our real estate team will be happy to help.
For advice and guidance, please get in touch.
