Minimum Energy Efficiency Standards (MEES) for Rental Properties
Since 2008 Energy Performance Certificates (EPC’s) have been required on both domestic and non-domestic buildings whenever they are sold, rented, or constructed. Under an EPC a building’s energy efficiency is rated on a scale from A to G, with an A rating being the best (highest efficiency) and a G rating being the worst (lowest efficiency).
The Minimum Energy Efficiency Standards (MEES) were first brought into law in April 2016, under The 2015 Energy Efficiency Regulations and initially allowed tenants to request a landlord make improvements to their property in order to make it more energy efficient.
From April 2018, rental properties by law must achieve an EPC rating of at least an E or above or a new tenancy cannot be granted to either existing or new tenants.
Further still property owners will not be permitted to continue letting a property if its EPC rating is not at least an E or above, with this requirement expected to come into force in April 2020 for domestic properties and April 2023 for non-domestic properties. Looking into the future it is expected that the government will increase the current minimum standard of an E rating to a D rating within the next 10 years, then a C rating within 15 years.
A Summary of Key Minimum Energy Efficiency Standards (MEES) Dates
- October 2008 – Energy Performance Certificate for Buildings whenever they are sold, rented, or constructed were introduced.
- April 2016 – Minimum Energy Efficiency Standards MEES first brought into law. Tenants can request a landlord make improvements to their property in order to make it more energy efficient.
- April 2018 – A rental property must now achieve at least an EPC rating of E whenever a new tenancy is to be granted to either a new or existing tenant.
- April 2020 – All domestic properties must now achieve an EPC rating of at least an E or above to be continue being rented.
- April 2023 – All non-domestic (commercial) properties must now achieve an EPC rating of at least an E or above to be continue being rented.
- Est. 2025 – The MEES minimum standard of an EPC rating of at least an E is expected to be increased to a D rating.
- Est. 2030 – The MEES minimum standard is expected to increase again to at least a C rating.
Buildings that are exempt from the Minimum Energy Efficiency Standards (MEES)
As with most legislation there are a few exemptions to the rules. The Minimum Energy Efficiency Standards will not apply to a building where:
- The property has no requirement for an EPC. These could be buildings of low-energy demand such as storage buildings or workshops, listed properties, temporary buildings, and buildings used as a place of worship.
- A commercial property with a tenancy of less than 6 months (with no right to renew) or with a tenancy of more than 99 years.
- Domestic properties that do not have regulated tenancies or lettings by public landlords such as Housing Associations and Local Authorities.
- Where the so called ‘Golden Rule’ applies. This is where an independent energy assessor (such as ourselves) determines that all feasible energy efficiency improvements have already been carried out at the property. Any further measure would not be economically viable (they would not payback within 7 years) and therefore they are not required to be carried out.
- If the work needed to meet an EPC rating of an E would devalue the property by more than 5%.
- Third-Party consent energy improvement works from someone such as the tenant or local planning authorities has been refused.
The Penalties for Non-Compliance
If a landlord fails to comply with the Minimum Energy Efficiency Standards regulations and his building does not qualify as an exemption, then they could face a civil penalty enforced by Local Weights and Measures Authorities.
If a non-compliant commercial property is let for fewer than 3 months the penalty will be equal to 10% of its rateable value, with a minimum penalty of £5,000 and a maximum of £50,000. If the property is non-compliant and let for longer than 3 months, the penalty will be equal to 20% of its rateable value, with a minimum penalty of £10,000 and a maximum of £150,000.
Landlords renting out a non-complaint domestic property could face a penalty of up to £5,000. Further penalties could be incurred if the tenant changes and the property is still non-complaint.
How we can help
We can provide energy performance certificates for a range of buildings from the simple to the most complex level 5 commercial buildings. If you already have an EPC but the rating is worse than an ‘E’, we can help you to find the most cost-effective ways of improving your properties energy efficiency, saving you money, and avoiding the possibility of receiving a fine under the Minimum Energy Efficiency Standards.
How else we can help:
- We give advice upon the legislation and its implications for your assets.
- Assess current energy efficiency and energy performance risk across your portfolio and for individual assets.
- Produce an Energy Efficiency plan for your building or portfolio
- Procure and manage any necessary improvement works.
- Provide energy performance reports and ratings for statutory compliance and for marketing purposes.
For more information or advice, please email email@example.com