Landlords to face fines if new energy efficiency rules not met warns lawyer
Landlords should ensure their properties meet new energy efficiency standards ahead of regulations coming into place in April 1 2023 or they could face unlimited fines, according to a lawyer.
While the Minimum Energy Efficiency Standard (MESS) used to range from Energy Performance Certificate (EPC) ratings of A – G, new rules will see level E set as the minimum standard.
Commercial property specialist Rajinda Sanghera, an associate at national law firm Clarke Willmott LLP, says landlords could be prohibited from leasing a property if they don’t meet the new standard.
‘Currently, the regulations prevent a landlord from granting a new tenancy of a commercial property that has a sub-standard EPC rating of F or G. From 1 April next year,’ said Ms Sanghera. ‘The MEES Regulations will extend to all lettings of commercial property; a landlord ‘continuing to let’ a sub-standard commercial property will be in breach of them.
‘Fines will depend on the circumstances of the breach. They start at 10% of the rateable value up to a maximum of £5,000 and rise to 20% to a maximum of £150,000.’
Landlords can be exempted from the MESS regulations if an independent surveyor rules that all relevant energy efficiency improvements have been made to the property or if they decide the improvements would reduce market value of the house by 5%.
They can also be exempted if consent to make improvements has been refused by the tenants, a superior landlord or planning authorities.
Ms. Sanghera said: ‘Existing leases remain valid, but the provisions of those leases may not permit the landlord to take any steps to improve the energy rating of the property, nor contain some of the green lease clauses seen in newer leases.
‘A landlord may be able to take advantage of the exemptions contained in MEES for continuing to let a sub-standard property but, where they can, must ensure that the exemption is validly registered on the PRS Exemptions Register.’
Additionally, the lawyer says when it’s time to sell landlords could face devaluation of their properties if potential purchasers realise they need to factor in improvement costs and register exemptions.
In related news, green roofs can save people money on energy bills and benefit the environment at the same time, according to property management company FirstPort.
Photo by Ethan Wilkinson
There is no reason as to why properties should not meet “E” rating at this time. However, the bigger potential scenario is if and when the minimum EPC rating is set at “C”. Even more so when it is obvious that the so called “EPC surveyors” get it totally wrong as a result of a quick 10 or 15 minute look – not survey in the true sense – around a property during which they ignore several important facets such as insulation in loft and flat roof voids, energy efficiency of the boilers etc.