WHAT IS AN EPC?
An energy performance certificate is needed whenever a property is built, sold or rented. The EPC provides analysis and detail on the property's energy efficiency and provides suggestions and estimated costs on how best to improve the energy efficiency of the property. Once you have your certificate you will have a good idea of the current cost for the utilities and the potential savings you could earn should you implement the suggested changes (if any). Finally, the report displays a rating from A-G (A being very energy efficient, G otherwise) to provide a clear and simple conclusion on the energy efficiency of the property. If an EPC is not made available upon request, penalties may apply to the seller/builder/landlord. From 1 April 2018, all rented property (both domestic and non-domestic) which is to have a new tenancy must have an EPC rating of at least “E”. This requirement also applies to all renewal tenancies to the same tenant for the same property on or after 1 April 2018.
DO I NEED AN EPC?
Buildings which do not require an EPC are places of worship, temporary buildings that will be used for less than 2 years, stand-alone buildings with total useful floor space of less than 50 square meters, industrial sites, workshops and non-residential agricultural buildings that don’t use a lot of energy, some buildings that are due to be demolished, holiday accommodation that’s rented out for less than 4 months a year or is let under a license to occupy, listed buildings, residential buildings intended to be used less than 4 months a year. This information is not legal advice. Please sort a legal advisor for legal advice.
THE HEATING RULE?
Generally an EPC is required if the building has a roof and walls and use energy to 'condition' the indoor climate. The 'conditioned' rule does not make all buildings without heating exempt from the regulations.
HOW OFTEN DOES AN EPC NEED TO BE DONE ON A RENTAL PROPERTY?
An EPC is valid for 10 years and can be used multiple times during this period.
HOW TO COMPLY WITH MINIMUM LEVEL OF ENERGY EFFICIENCY STANDARD (EPC BAND E)
(This information is courtesy of www.gov.co.uk and is based on domestic private rented properties). The Domestic Minimum Energy Efficiency Standard (MEES) Regulations set a minimum rating for domestic private rented property. Namely, let on specific types of tenancy agreement and domestic private rented property legally required to have an EPC.
ANSWER THESE QUESTIONS TO FIND OUT WHETHER YOUR PROPERTY IS COVERED BY THE REGULATIONS
1. Is your property let on one of the following types of domestic tenancies:
an assured tenancy?
a regulated tenancy?
a domestic agricultural tenancy?
2. Is your property legally required to have an EPC?
If the property you let has been marketed for sale or let, or modified, in the past 10 years then it will probably be legally required to have an EPC.
If you answered Yes to both these questions, and your property has an EPC rating of F or G, you must take appropriate steps to comply with the requirements of the MEES Regulations.
FUNDING IMPROVEMENTS TO YOUR PROPERTY
The good news is there is a cost cap. You will not be required to spend more then £3,500 including vat on energy efficiency improvements. If you are not able to reach the E rating having spent this amount on improvements, register an "all improvements made" exemption. It is worth noting you can count any energy efficiency investment made to your property since 1 October 2017 toward the cost cap. There is no requirement to spend the entire cost cap amount if you are able to improve the property to the E rating for less.
HOW DO I KNOW WHAT TO IMPROVE
An EPC will detail possible improvements and provide an idea of the potential rating if the suggested improvements are implemented.
SAMPLE RECOMMENDATION FROM AN EPC REPORT (Indicative only)
Recommended Measures Indicative Cost Typical savings per year
Roof-in-roof insulation £1500-£2700 £837
Internal/External wall insulation £4000-£14000 £195
Solid floor Insulation £4000-£6000 £122
Increase hot water cylinder insulation £15-£30 £142
Draught proofing £80-£120 £18
Low energy lighting £20 £21
Solar water heating £4000-£6000 £57
WORKING OUT WHEN TO TAKE ACTION
If your current tenancy period started before 1 April 2018 and runs until at least 1 April 2020 You have until 1 April 2020 to improve the property rating to E, or register an exemption, if you want to continue to let it.
If your current tenancy period started before 1 April 2018, but you plan to enter a new tenancy (with a new or existing tenant) before 1 April 2020 you need to improve the property rating to E, or register an exemption, before you enter into the new tenancy or renew an existing tenancy.
If your current tenancy period started on or after 1 April 2018 (if you haven’t already taken action), you must improve the property’s rating to E immediately, or register an exemption.
If your previously let property is currently empty and you are not planning to let the property, there is no need to take any action to improve the propertys rating until you decide to let it again.
NOTE: None of the above is legal advice. Seek a qualified professional legal advisor for legal advice.
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