Author
Mark Curley

Date
9th June 2021

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Preparing for a Change in Energy Efficiency Standards

Thoughts

MEES – the minimum energy efficiency standard for private rented property – is changing. The Government is currently consulting on how to implement these changes, a process which could have massive implications for the construction industry.

At the moment, MEES is set to EPC (Energy Performance Certificate) E, which indicates a score nearer the bottom of the scale. However, having large numbers of property which only meet this standard is going to make it impossible to hit the UK’s zero-carbon goals, so the Government has proposed raising the standard to EPC B by 2030.

The proposed changes won’t just change the score buildings must reach: they’ll also change which buildings need an EPC in the first place. Currently, only buildings constructed, sold or let since 2013 require an EPC. This will extend to cover all non-domestic buildings, with a new “Exemptions and Compliance” database ensuring that local authorities can track non-compliance easily, and register exemptions. (It’s possible to seek exemptions to achieving EPC B or C with a new seven-year payback calculator, which covers upgrades carried out by the energy assessor.)

It goes without saying that making the leap to EPC B will be a complicated, challenging feat, and we’ve been following the consultations closely to ensure we’re ahead of the curve. Currently, these changes – and their implementation challenges – will only apply to England and Wales. It remains to be seen whether something comparable will be introduced in Scotland, but we’ll be keeping an eye out for any announcements given that Corde has several studios north of the border.

There are three headlines to the Government’s proposed approach:

  • Phased implementation. The plan is to achieve EPC C by 2027, setting the stage for EPC B three years later.
  • Compliance windows. These two-year windows will begin with landlords presenting a valid EPC, and end by the overall deadline year (so 2025–27 for EPC C, and 2028–30 for EPC B).
  • Moving away from enforcement at the point of let. Enforcement has generally been seen as a big challenge with the changes – particularly enforcement centred on changes in tenant.

Shell and Core

Shell and core leases present a special issue of their own, as many features assessed by an EPC are the responsibility of the tenant. This raises problems where a landlord might have to install measures which would immediately be replaced by their tenant, or where a tenant might be obliged to pay for an installation before they legally take up the lease.

To address this, the Government has proposed giving landlords the option to register a six-month temporary exemption at the point of let and lease renewals, rather than immediately enforcing the MEES. This would allow a smooth transition when a tenant starts occupying a shell and core property, while ensuring that a compliant EPC still has to be lodged on the register at the end of six months.

What Does This Mean for You?

2030 is only nine years away – a scarily short time in construction. It’s essential to start planning for the changes now, and to take the opportunity to influence the way they’ll be implemented.

The consultation runs until the 9th June, and we encourage you to take a look at the proposals and make your opinion heard. If there are any aspects of EPCs or MEES which you need assistance with – from general guidance to completing calculations – contact Corde and we’ll be happy to help, tailoring our wide range of experience to your specific project. You can get in touch with any of our team through our contact page, or email us directly.