On 1 April 2018, the new minimum energy efficiency standards (MEES) came into force.
However, leading up to this, research suggested that large numbers of both landlords and tenants were unaware of what these new standards were, and what implications they had.
Government figures suggested that, as of 1 April 2018, 400,000 properties were failing to meet energy performance standards.
Has anything changed since then?
What Does MEES Mean for Landlords?
Under the rules of the new minimum energy efficiency standards, a landlord cannot rent out a property to a new tenant if it rates below an E on its energy performance certificate (EPC), unless they register an exemption.
This also applies to renewing existing tenancies.
Landlords can also be subject to fines of up to £4,000 if they are found to be letting out properties with EPCs below an E rating
In its research, landlord insurer, Just Landlords, found that:
- Only 24% of landlords could identify what the correct fine would be
- 80% of tenants surveyed did not realise a property’s EPC could a be clear indication of its environmental impact
Improving a property’s EPC is a clear means of saving money, as well as ensuring that it is lettable in the future.
At a time where there is a crisis in rental supply, failing to comply with MEES could have a significant impact, on landlords and tenants.
What Affects Energy Performance?
Landlords should be aware of what might affect a property’s energy performance rating.
There are quick wins, where they can make the necessary adjustments to improve energy performance.
For example, insulation can be critical. Most heat is lost through the poor sealing of doors and windows, and inefficient insulation of walls and the roof.
Replacing door and window seals can eliminate drafts, and replacing or adding to roof insulation will reduce heat loss through the roof.
Cavity wall insulation is more demanding to install, but may be essential in improving energy performance.
Landlords can also consider other aspects of energy efficiency such as lighting. Installing low energy LEDs is another relatively straightforward solution.
Monitoring energy use is helpful, and landlords might want, therefore, to install smart meters in their properties.
Maintaining EPC Standards
Many commercial landlords may be breaching EPC rules without being aware of it.
EPC ratings require updating every 10 years, but buildings must keep pace with the software used to calculate them, as this is updated every two years.
It gets tougher for commercial landlords to maintain their buildings’ EPC ratings unless they routinely look at including upgrades to their energy efficiency
It is vital, therefore, that landlords have their buildings thoroughly surveyed for energy performance, and seek the right professional advice regarding necessary improvements.