UNDERSTANDING THE LATEST EPC REGULATIONS FOR COMMERCIAL PROPERTIES: WHAT YOU NEED TO KNOW
Released On 22nd May 2023
Since the start of April, new laws have come into place making Energy Performance Certificates (EPC) a leading priority for commercial property owners. These significant changes aim to set minimum standards for energy efficiency in commercial properties, now deeming underperforming properties illegal.
So, if you manage commercial property and are wondering what impact this may have on you or your business, here is our essential guide.
What is an EPC?
An EPC is an Energy Performance Certificate that gives a property an energy efficiency rating from A (most efficient) to G (least efficient). These were originally introduced by the government in 2007 to make people more aware of the energy that a building uses.
EPC’s contain important information surrounding a property’s energy use, energy costs and recommendations on how to reduce energy and save money. In addition to a property’s current rating, the EPC also highlights what the property’s potential rating could be, once recommendations have been applied.
In the UK, an EPC is required at any point that a property is built, rented or sold, and valid for a 10-year period. They must be ordered in advance of marketing a property and made available for potential tenants and buyers to view before a property can be rented or sold.
Why are the regulations changing?
From this month, it is no longer legal to let a property with an EPC rating below E. This sets an important quality standard for commercial property, ensures all properties are energy efficient and aims to reduce associated carbon emissions. This will be a crucial step in helping the government achieve their goal of net-zero by 2050.
Are there other changes to prepare for?
This is only the first step in a series of legislative changes, with EPC ratings minimum requirements set to continue to rise over the next few years, increasing to require a rating of C by 2027 and B by 2030. As a result of this, it is incredibly important for property owners and managers to set out on the right path now, to make sure they are ready for more challenging legislation yet to come.
What does this mean for commercial property?
There is no time to wait. EPC ratings must meet the minimum standard now, making it a top priority for property owners.
As it stands It is estimated that 120m sq ft of commercial real-estate in England will have failing EPC ratings by the end of April. Properties that fail, become un-leasable, with risk of fines of up to 12.5% of the property’s rateable value. Many properties will require improvements in order to meet the new rating requirements, for which property owners are liable for.
The time to act is now
It is important to get on top of the new regulation changes now, before standards tighten further over the next 7 years. Failure to do so will lead to it being too late to make the energy efficiency changes required, causing many property owners to be sat on properties holding minimal commercial value.
Not sure what to do next? Need support from commercial experts? It’s time to get in contact with the commercial property solicitors at AmicusLaw to help you navigate through these changes and the next steps.
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