For the past few years, virtually all property transactions have required an “Energy Performance Certificate”, showing the property’s energy efficiency rating: “A” is the best rating and “G” is the worst.
On 1 April 2018, the Energy Efficiency (Private Rented Property) (England and Wales) Regulations (2015) will take effect, imposing minimum energy efficiency standards (“MEES”). MEES applies to both residential and commercial property in the private rented sector.
Unless an exemption applies, it will become unlawful for a landlord to grant a new lease, a renewal lease or a lease extension to tenants of residential or commercial properties, if the property has an EPC rating below E. The Regulations will be extended over the coming years so that eventually it will be unlawful to continue letting any property with an EPC rating below E.
The fines for non-compliance with the Regulations are potentially very large: penalties of up to £150,000 can be imposed per 3-month infringement. Landlords also face having details of their infringement published as well as ongoing fines for a subsequent failure to comply with any enforcement action taken.
Here is a chronology of the dates when the provisions take effect:
1 April 2018 – MEES takes effect, as outlined above, in relation to new lettings.
1 April 2020 – MEES is extended to existing lettings of residential property, and it will become unlawful to permit existing lettings of residential properties with an EPC rating below
level E.
1 April 2023 – MEES is extended to existing lettings of commercial property, and it will become unlawful to permit existing lettings of commercial properties with an EPC rating below
level E.
PLEASE NOTE: this briefing note contains information about current legal issues and is only intended as a general statement of the law – it does not give legal advice. No action should be taken in reliance on this note without specific legal advice.
If you would like to know more, please contact Pauline Glen.