In September 2023, the then Conservative government scrapped plans for landlords to bring their rental properties up to a minimum EPC C (energy performance certificate) rating by the end of 2025 for new tenancies.
With the new Labour government in place, Energy Security and Net Zero Secretary Ed Milliband has announced landlords will need to ensure their properties meet the minimum C rating by 2030 as part of Minimum Energy Efficiency Standards (MEES).
What are Minimum Energy Efficiency Standards?
In simple terms, MEES are a series of requirements set out to establish a minimum energy efficiency rating, commonly known as an EPC rating. Currently, landlords must ensure their properties are a minimum E rating on a scale of A to G, with A being the most efficient. Any property under an E cannot legally be let out unless the landlord has successfully applied for an exemption.
The point of MEES is to improve the energy performance of properties in the rental sector as the UK strives to achieve Net Zero.
Before the previous Conservative plans were scrapped, many landlords were concerned they would have to spend thousands to achieve the minimum C rating.
Why has Labour Brought This Back?
Announcing the plans, Ed Miliband told the House of Commons; “One thing that this Government will do that the last Government did not, is demand that landlords raise the standard of their accommodation to a proper energy performance certificate standard C by 2030.”
Mr Milliband stated this move would help tackle fuel poverty, which currently affects more than three million people in the country.
Further details were not provided on how the minimum standards are to be achieved. The government is expected to provide further information in due course.
What are the Exemptions?
No further details were provided on any possible changes to exemptions for landlords. However it is likely they would be similar to the previous set, which included a high cost exemption, a consent exemption and all improvements made exemption.
It is also important to point out that despite what many organisations or owners of Grade listed buildings may say, they are not by default exempt from MEES regulations. They are only exempt if any works to improve the energy rating would unacceptably alter the building’s appearance or character. This could mean improvements such as cavity wall insulation or new double glazing may not be feasible or possible, however there would not necessarily be any reason to prevent installing a new efficient boiler or loft insulation as these would not alter the property itself.
What is for sure though is that landlords do need to start thinking about improving their rental properties if they are below a C rating now.
Our Thoughts
There is no doubt MEES are an important requirement and improving the energy efficiency of the UK rental stock is a key aspect to achieve Net Zero. Landlords should always strive to have as efficient a property as they can.
It is important the government provides more context in the near future as to any possible changes to spending caps or other exemptions as this will help landlords plan for the improvements before 2030, which is not as far away as many may think.
It is also likely EPCs themselves will be revamped to help annul concerns over how the existing certificates support MEES requirements. We expect to hear more on that as part of the national EPC Action Plan.
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