- Energy Performance Certificates (EPCs) Explained
Legal Assistant Olivia Foster, in our Commercial Property team, explains Energy Performance Certificates (EPCs).
Since 1 October 2008 Energy Performance Certificates (EPCs) have been required for a new letting or sale of a commercial (or indeed domestic) property. An EPC is also required for a finished building under construction and where there are alterations to a number of parts of the building being used for separate occupation where the changes involve providing or extending fixed heating, air conditioning or mechanical ventilation systems.
An EPC is a rating scheme measuring a property’s energy performance and energy performance capabilities based on Co2 emissions. The certificate takes into account the property’s building fabric, heating, ventilation, cooling and lighting systems.
The certificate has a rating scale (similar to those found on household appliances) which is coloured and labelled A-G, A being the most efficient and G least efficient. Once an EPC is commissioned it is generally valid for 10 years and is available for public access.
The EPC also includes useful information such as the benchmark indication of ratings that similar properties may have obtained to enable you to establish if your property needs improving, perhaps to make it more desirable to potential tenants.
As well as the EPC a “Recommendation Report” is published alongside the certificate and should be read in conjunction with the EPC. The Recommendation Report gives advice on how to improve the property’s energy efficiency and how best to reduce carbon emissions, broken down into short payback, medium payback and long payback and other recommendations. The recommendations are given a rating of low, medium and high to distinguish what improvements are most likely to reduce carbon emissions for the property and help to save money.
If an EPC is not provided, then the penalty for failing to comply is a 12.5% of the rateable value, subject to a minimum of £500 and maximum of £5000. The penalty is repeated every 28 days until an EPC is prepared and provided.
The following properties do not require an EPC:-
- listed or officially protected but only where the minimum energy performance requirements would unacceptably alter it
- a temporary building being used for 2 years or less
- places of worship or other religious activities
- an industrial site, workshop or non-residential agricultural building that doesn’t use much energy
- a detached building with a total floor space under 50 square metres
- a building which is due to be demolished by the seller or landlord and all the relevant planning and conservation consents for such have been obtained
You can check whether your property has an EPC at the following websites:-
EPCs were quite often ignored but with the coming into force of the MEES regulations on 1 April 2018 they have taken on a whole new significance and should not be ignored.
This article is intended for the use of clients and other interested parties. The information contained in it is believed to be correct at the date of publication, but it is necessarily of a brief and general nature and should not be relied upon as a substitute for specific professional advice.