A Landlord’s guide to the changes to Energy Performance Certificate ratings for commercial buildings

Since 1 April 2018 there has been a minimum energy efficiency standard (MEES) of EPC E for private rented properties, including commercial, or mixed-use properties. This means that it is unlawful for landlords to grant a new tenancy of commercial property with an EPC rating of ‘F’ or ‘G’ (the two lowest grades of energy efficiency). This applies to both new leases and renewals (unless an exemption applies and the landlord has registered that exemption).
From 1 April 2023, this will be extended to include existing leases making it unlawful for a landlord to continue to let commercial property (unless an exemption applies and is validly registered).
The Government has confirmed that it intends to make it unlawful to continue to let commercial property with an EPC rating of below B by 2030 and in March 2021, it issued its proposed framework for private-rented properties. This forms part of its “package of measures’ to reduce carbon emissions as it is estimated that bringing the minimum standard to a B rating will bring around 85% of commercial buildings into scope. The proposed framework sets out a phased implementation with the introduction of compliance windows.
If you are the tenant of a commercial property that you currently, or propose to, let out, and would like to know more about the changes to the EPC regulations, the possible exemptions, and issues that could arise with regards to costs and valuation, then please contact us.
Rachel Appleton is a solicitor with over 15 years’ experience of specialising in all areas of commercial property, including the acquisition and disposal of commercial properties, advising on commercial leases for both landlords and tenants, and assisting and advising on commercial funding. She joined Capron and Helliwell’s commercial property department in April 2021.