New EPC rules introduced for commercial property landlords

UK landlords have had cause for concern over recent legislation updates regarding Energy Performance Certificate (EPC) ratings on commercial properties.

The legislation, which came into force on 1 April 2023, states that all commercial properties need a minimum EPC rating of E. An EPC will give a property an energy efficiency rating from A (most efficient) to G (least efficient), valid for 10 years.

According to analysis from Search Acumen, there are currently 19,166 commercial properties for lease in the UK that are now in breach of the legislation.

Landlords with commercial properties underneath this EPC rating now find themselves breaking the law and can be subject to hefty fines.

Here, Carl Jones, a Director with Mander Hadley and Head of our Commercial Department, explains EPC requirements:

Do I need an EPC?

An EPC is needed whenever a property is rented, sold, or when construction on it has finished. It contains information about a property’s energy use, typical energy costs, and recommendations about reducing energy use and saving money.

An EPC must be displayed on commercial buildings when all the following apply:

• The total useful floor area is over 500 square metres

• The building is frequently visited by the public
• An EPC has already been produced for the building’s sale, rental, or construction

In some circumstances, an EPC is not required. You will not need an EPC if your property falls into any of the following categories:

• Places of worship
• Temporary buildings with a planned time of use less than 2 years
• Stand-alone buildings with a total useful floor area of less than 50m²  that are not dwellings
• Industrial sites, workshops and non-residential agricultural buildings with low energy demand
• The building is suitable for demolition and the site could be redeveloped

• The buyer or tenant has applied for planning permission to demolish it

Obtaining an EPC

Gain an EPC by seeking an accredited commercial energy assessor to inspect the property and produce the certificate. There are different assessors available for different types of buildings, so you will need to ensure you choose the right one for your specific needs.

An EPC must be in place before a property is rented and fines can be incurred if they are not displayed, so reaching out to an assessor is of paramount importance.

Upgrading my EPC rating

With Government plans to increase the minimum EPC rating further in the future, it is in the interests of commercial landlords to improve the efficiency standards on their buildings as soon as possible.

Here are just a few things you can do to improve your commercial EPC rating:

• Switch to more energy-efficient lighting such as LED or fluorescent lighting
• Upgrading windows to double or triple glazing
• Ensuring you have the most up-to-date boiler available

• Improvements to wall and roof insulation
• Ensuring heating and electronic systems are switched off when not in use
• Invest in renewable energy

Need more advice on commercial property and EPC rules? Get in touch with our commercial property team today.

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