EPC Ratings Standards for Commercial Real Estate Landlords (MEES)

The incoming Minimum Energy Standards (MEES) are soon to be a legal requirement. 

Under current regulations the minimum standard of band E EPC applies, and it is unlawful to let a commercial premises which falls below this standard. From April 2023, this requirement will be extended to existing lettings, making it unlawful to continue to let a property which fails to achieve a rating of E.

What is an EPC?

An Energy Performance Certificate (EPC) rates how energy efficient your building is using grades from A to G (with ‘A’ the most efficient grade).

When do you need an EPC?

You must have an EPC if:

• you rent out or sell the premises
• a building under construction is finished
• there are changes to the number of parts used for separate occupation and these changes involve providing or extending fixed heating, air conditioning or mechanical ventilation systems

You can be fined between £500 and £5,000 based on the rateable value of the building if you don’t make an EPC available to any prospective buyer or tenant.

Exemptions

You don’t need an Energy Performance Certificate (EPC) if you can demonstrate that the building is any of these:

• listed or officially protected and the minimum energy performance requirements would unacceptably alter it
• a temporary building only going to be used for 2 years or less
• used as a place of worship or for other religious activities
• an industrial site, workshop or non-residential agricultural building that doesn’t use much energy
• a detached building with a total floor space under 50 square metres
• due to be demolished by the seller or landlord and they have all the relevant planning and conservation consents

Vacant buildings and demolition

A building is also exempt if all of the following are true:

• it’s due to be sold or rented out with vacant possession
• it’s suitable for demolition and the site could be redeveloped
• the buyer or tenant has applied for planning permission to demolish it

How is a Commercial EPC calculated?

The energy rating of a building is a complex calculation which is based on a number of factors. These factors include:

• the type of construction of the building (including walls, roofs, floors and glazing)
• whether different parts (or zones) of the building are used for different purposes
• heating, cooling, ventilation and hot water systems used
• the lighting used throughout the building

Future Proposed Requirements

The Governments 2020 Energy White Paper states that ‘All rented non-domestic buildings will be EPC band B by 2030, where cost-effective’. 

How we can help

If you are concerned that you will be unable to meet the minimum requirements, get in touch with us today to arrange a free survey of your building.