ENERGY PERFORMANCE CERTIFICATES (EPC) FACTSHEET
An Energy Performance Certificate (EPC) provides information on the energy efficiency of a
building, giving an energy rating from A (the most efficient) to G (the least efficient) as well
as making recommendations on how to improve the property’s energy performance.
An EPC is legally required for selling or letting residential and commercial property in England
and Wales.
Regulations have been in place since 2007 and extended through The Energy Performance of
Buildings (England & Wales) Regulations 2012 that came into force on 9 th January 2013.
Most recently The Energy Efficiency (Private Rented Property) (England and Wales)
Regulations 2015 have been passed, phasing in obligations for Landlords concerning the
energy efficiency of private rented properties.
Who provides EPCs?
An EPC must be prepared by a Government accredited (regulated) Energy Assessor. If you
are intending to sell or let your property through Samuel & Son and require an EPC, then we
can arrange this for you through our local accredited provider.
Who is responsible for obtaining the EPC?
Ultimately the duty to provide an EPC falls on the seller in the case of a building being sold,
or the landlord, in the case of a building being rented.
When must an EPC be made available?
There is a duty on the seller and persons acting on behalf of the seller to make sure that an
EPC is available or has been commissioned (i.e., a Domestic Energy Assessor has been
instructed to prepare the EPC) before the property is marketed for sale or rent.
1
Samuel & Son Chartered Surveyors
EPC Fact Sheet
October 2015
Additionally the seller and persons acting for them must use all reasonable efforts to ensure
that the EPC is obtained and made available within 7 days of the start of marketing and an
EPC absolutely must be obtained within 28 days of the start of marketing.
Are there any exemptions?
Yes. As of 9 th January 2013 listed buildings (Grade 1 or 2 listed), buildings in a conservation
area or those officially recognised as being of special architectural or historical merit, that
are marketed for sale or rent are exempt from EPC's. However, this is only to the extent that
compliance with the energy efficiency requirements would ‘unacceptably alter their
character and appearance’.
And amongst the more relevant exemptions are detached buildings with a floor space of less
than 50 square metres and non-residential buildings with a low energy demand such as farm
barns. Also properties let prior to EPC Regulations, ie before 1 st October 2008 where there
has been no change of tenant.
What about Holiday Lets?
An EPC will be required for a property rented out as a holiday let where the building is
occupied as a result of a short term letting arrangement and is rented out for a combined
total of four months or more in any 12 month period.
What is the EPC assessment procedure?
Dimensions of the property will be taken to ascertain the floor area and ceiling heights.
Access to all rooms and loft areas is required to obtain details on heating, radiators, glazing,
lighting, insulation and details of the main and secondary heating systems along with any
water cylinder installed. The estimated energy bill calculations on the EPC are based on
standardised living conditions and not the property owner’s actual energy bills.
How long is an EPC valid for?
EPC’s will be valid for 10 years from the date of issue.
Does the EPC need to be included in written property particulars?
All advertisements in the commercial media should show the asset rating, i.e the letter
rating. It is not compulsory to display the full A-G graph. (The requirement for property
particulars to be accompanied by a copy of the first page of the EPC was scrapped under the
current Regulations.) Given the proviso to obtain an EPC within 7 days of marketing it
appears possible to advertise initially without including the asset rating.
What if an EPC is not produced?
Trading standards services are responsible for the law regarding EPCs. If a breach of any duty
under the Regulations has been committed, a penalty charge notice may be given.
For domestic properties, the penalty notice charge is £200. For non-domestic properties, the
minimum and maximum penalty charges can vary between £500 and £5,000 depending on
the rateable value of the building.
It is an offence to issue or provide false documentation with respect to an EPC under the
Consumer Protection from Unfair Trading Regulations 2008.
2
Samuel & Son Chartered Surveyors
EPC Fact Sheet
October 2015
PRIVATE RENTED PROPERTY:
A GUIDE TO THE NEW ENERGY EFFICIENCY REGULATIONS 2015
The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 were
passed through Parliament in March 2015 as part of the Government’s strategy to meet
climate change targets and will affect both domestic and commercial private rented
property.
What do the changes mean to Landlords?
Minimum Energy Efficiency Standards (MEES)
From 1 st April 2018 all rented property (both domestic and non-domestic) must have a
minimum EPC rating of “E”. The Regulations will come into force for new lets and renewals
of tenancies with effect from 1 st April 2018. All existing domestic tenancies will fall under
the Regulations from 1 st April 2020 and existing non-domestic leases from 1 st April 2023.
It will be unlawful to rent a property which breaches the requirement for a minimum “E”
rating, unless there is an applicable exemption. It is considered that listed buildings are
exempt in most cases as they do not presently require an EPC under current regulations.
Otherwise, the new Regulations clearly set out three exemptions which will allow landlords
to let or (later), continue to let, properties which do not meet the relevant EPC rating.
1. Cost effectiveness
A landlord is exempt if there is no Green Deal available for the improvements recommended
by an independent installer of energy efficiency improvements and it has been assessed that
the recommended improvements would not pay for themselves over seven years based on
energy savings in the energy bill.
2. Third party consent
A landlord is unable to increase the energy performance rating of a property to not less than
the minimum level because a third party who had the right to prevent works from being
carried out without their consent, such as a lender, freeholder or sitting tenant refused to
grant consent or would only grant consent subject to a condition that a landlord could not
reasonably satisfy.
3. Devaluation
MEES will not apply where a report obtained from an independent surveyor states that the
energy efficiency improvements will decrease the market value of the property (or the
building of which it forms part) by more than five per cent.
An exemption will last for up to five years and will need to be pre-registered on a central
register for a landlord to rely on it.
Failure to comply with the Regulations will result in Landlords facing a financial penalty.
3
Samuel & Son Chartered Surveyors
EPC Fact Sheet
October 2015
Where the breach is for less than 3 months, the fine will be:
•
•
for commercial property - £5,000 or 10 per cent of the rateable value
for residential property - £2,000
Where the breach is for more than three months, the fine will be:
•
•
for commercial property - £10,000 or 20 per cent of the rateable value (up to
£150,000)
for residential property - £4,000
Tenants’ Energy Efficiency Improvements
From 1 st April 2016 a tenant in a private domestic rented property will be allowed to
reasonably ask their Landlord for a relevant prescribed energy efficiency improvement. The
prescribed energy improvements are those prescribed in the Schedule of The Green Deal
(Qualifying Energy Improvements) Order 2012 and include items such as wall and roof
insulation and secondary and replacement glazing.
The Landlord will not be able to unreasonably refuse consent but no upfront costs should fall
on the Landlord, unless the Landlord agrees to contribute. Landlords will not be obliged to
make improvements unless there is a grant under a Government or Local Authority finance
initiative, Energy Company Obligation or similar.
A tenant may not make a request for energy efficiency improvements where:
•
the tenant has given notice to the landlord ending their tenancy or the tenant has
been served a notice requiring possession by their landlord;
•
court action has begun related to a tenant’s failure to keep to the terms of their
tenancy, for example court action relating to rent arrears.
In certain situations it would be permitted for a landlord to reasonably confuse consent to a
tenant’s request, most notably where:
•
another tenant made a request within the preceding six months and the landlord
complied with their request;
•
the tenant has previously asked, within a prescribed timescale, and was given
permission for a Green Deal finance arrangement and the recommended measures
under the Green Deal finance arrangement were installed;
•
a Green Deal provider advised that the requested improvements would have a
negative impact on the fabric or structure of the building;
•
the improvement proposed is the same or substantially the same as that which the
landlord proposed but which the tenant had refused or failed to respond to within the
preceding six months;
•
a landlord is able to offer a counterproposal that achieves the same or improved level
of energy efficiency as the request proposed by the tenant;
•
Planning permission, required for the energy efficiency improvements is not granted.
4
Samuel & Son Chartered Surveyors
EPC Fact Sheet
October 2015
Summary
Samuel & Son advise all landlords to start planning for the introduction of these new
regulations now. Other than the possible financial penalties for non-compliance, your asset
may be unlettable if improvements have not been made by the relevant date and lenders are
likely to impose conditions on agreements to provide finance on F & G rated buildings.
Additionally landlords will potentially need to consider incorporating clauses into a tenancy
agreement concerning financial and access arrangements for carrying out any energy
efficiency improvements.
Please contact us if you would like any further information. Samuel & Son can arrange
domestic and commercial EPCs through a trusted third party accredited provider with whom
we have worked with for many years. We can also advise on the regulatory energy
requirements affecting property owners.
Samuel & Son Chartered Surveyors
Tel: 01435 864020
E-mail: [email protected]
Website: www.samuelandson.co.uk
INDEPENDENT RURAL PROPERTY PROFESSIONALS
5
Samuel & Son Chartered Surveyors
EPC Fact Sheet
October 2015