Multiple metrics

Proposal

1    Multiple metrics may cover:

• Energy cost.
• Carbon emissions.
• Energy use.
• Fabric performance (the thermal properties of the building and its ability to maintain a different temperature from its surroundings level of insulation, window quality, and the quality of construction.
• Heating system.
• Smart readiness. The Smart Systems and Flexibility Plan sets out a vision for a smarter and more flexible energy system, which is better able to manage the expected increase in demand for low-carbon electricity. Smart meters, intelligent appliances like EV charging points, Solar PV battery storage, and heat pumps, along with smart tariffs and services, will enable and encourage users to adapt their consumption patterns to match periods of cheap, abundant low-carbon electricity supply.

2    Other metrics may be considered over time, particularly in light of any minimum energy efficiency standards. EPCs could potentially expand beyond measuring energy efficiency to include other aspects of building performance e.g. EPCs might incorporate metrics related to a building’s resilience to climate change impacts and its adaptation measures, occupant health, wellbeing, biodiversity and water efficiency. However, this is not planned currently.

3    The energy efficiency rating (EER) is not currently displayed for non-domestic EPCs. The Government is interested in views on whether a cost-based metric should be included in the future for both domestic and non-domestic buildings.

4    Revised metrics to be introduced in the second half of 2026. The Government expects that new and/or amended metrics will be introduced for domestic buildings with the Home Energy Model.

5    There will be a further consultation on the Home Energy Model methodology for producing EPCs in 2025.

6    Any changes to the metrics for non-domestic buildings will be implemented through updates to the National Calculation Methodology for non-domestic buildings.

Requiring a valid EPC throughout the tenancy period

Proposal

A building should not be marketed for sale or let without an EPC. This will ensure that buyers and renters have information available to them at the point of making a purchasing decision whilst making the requirements clearer and easier to enforce.

Current position: A valid EPC is currently only required at the point of build, sale, or grant of a lease in the rented sectors. Therefore, many EPCs do not actually need to be renewed when their validity period ends. Reducing the validity period of EPCs could allow building upgrades, such as fabric changes, to be captured more frequently but also greatly reduces the scenarios we have currently where an EPC on renewal would not be obtained. Requiring a new EPC for rented buildings when the existing one expires would ensure that most new lease renewals would be potentially subject to MEES.

The Government’s preference is to allow all existing EPCs to remain valid until the end of their existing validity period and apply any new validity period to new EPCs.

Requiring an EPC when a single room is rented out

Proposal

• Requiring an EPC when a single room is rented out so that HMOs will need to comply with MEES Regulations.
• If rules require EPCs throughout a tenancy for HMOs where there are often multiple separate tenancies running concurrently for a single property, this would mean that an EPC would need to be in place at the point of marketing for the first let to the date on which the final letting comes to an end.
• Current exemptions in the MEES regulations "would be maintained". PRS MEES Regulations apply to most domestic rental properties which are required to have an EPC. Mandating EPCs for HMOs when a single room is rented out will ensure that HMOs will need to comply with the requirements set out in the MEES Regulations if they did not have a valid EPC before this point. This would provide consistency across the private rented sector.
• Proposing a 24-month transitional period for any HMO landlords newly brought into the scope of the regulations to obtain a valid EPC. This would also ensure reasonable time to comply with MEES requirements if these were applicable.

Requiring and EPC for short term rental properties when rented out

Proposal

Requiring short term rental properties (as defined in section 228(2) Levelling Up and Regeneration Act 2023) to have a valid EPC at the point of let regardless of who is paying for the energy costs.

The current guidance states that an EPC is only required for properties rented out as a furnished holiday let, as defined by HMRC, where the building is occupied for the purposes of a holiday as a result of a short term letting arrangement of less than 31 days to each tenant, and is rented out for a combined total of four months or more in any 12 month period, and if the occupier is responsible for meeting the energy costs for the property.

Requiring and EPC for all heritage properties

Proposal

Proposal for all heritage buildings (i.e. buildings officially protected as part of a designated environment or because of their special architectural or historical merit) to have an EPC (even if obtaining an EPC were to bring a heritage building into scope of MEES). It is not clear from the consultation whether the Government is looking to remove the exemption for landlords from obtaining an EPC for heritage properties (which is what the question on the consultation asks) so that they fall within scope on a sale or letting, or whether all heritage buildings should have an EPC even if not being sold or let.

There are relevant exemptions if consent by the relevant authorities cannot be obtained, or if any of the recommendations on the EPC that need to be made, devalue the property by more than 5%.

The Government plan for this to be further balanced by:

• ensuring EPC recommendations are tailored appropriately to consider the nature of the buildings;
• finding measures to ensure owners of heritage buildings are not mandated to install unsuitable measures, and
• there being clear guidance for owners, including how to claim a suitable exemption from complying with MEES where appropriate.

Under Regulation 5(1)(a) of the EPB Regulations, buildings officially protected as part of a designated environment or because of their special architectural or historical merit are not required to have an EPC in so far as compliance with certain minimum energy performance requirements would unacceptably alter their character or appearance. In practical terms, as minimum energy performance requirements are only in place for the rental sector, this has only applied to heritage rental properties, and only those where a recommendation on an EPC would unacceptably alter the character of the building if installed. In order for landlords of heritage buildings to know if they are within the scope of the regulations they still require some level of energy assessment of their property to know what recommendations would be included on an EPC.

DEC validity period reduction

Proposal

• To reduce the validity period of DECs and DEC recommendation reports from 10 years to 7 years for buildings between 250-1,000m², and the validity period of DEC recommendation reports from 7 years to 5 years for buildings over 1,000m².
• The current position is that public authority buildings which are frequently visited by the public and have a total floor area of over 250m² are required to have a DEC and DEC recommendation report. If the useful floor area is 1,000m² or less, the DEC and recommendation report are valid for 10 years, and if it is greater than 1,000m², the DEC is valid for one year, with the recommendation report valid for 7 years.

Proposal

Energy certificates should be available to all prospective buyers, tenants and enforcement bodies through the public address search function on the EPB Register. The option to opt-out certificates from the EPB Register should be removed to ensure access to all.

Proposal

To remove the general prohibition on the sharing of data gathered under the EPB Regulations (currently subject to specific exceptions), and to provide that data can be shared for use at the discretion of Secretary of State, in compliance with data protection requirements. This is to allow the EPB Register dataset to have wider utilisation.

Proposal

• To improve compliance by working with Local Weights and Measures Authorities and other stakeholders and estate agents.
• To increase penalties for breach. The Government does not propose to change the percentage of rateable value as the basis for penalty changes for non-domestic EPCs, but the minimum and maximum levels could be adjusted as suggested in the following table:

The penalties have not changed since the Regulations were introduced in 2007. Also being considered is increasing the six-month timescale for fines to be imposed. The Government will work with local authorities on how to ensure more effective enforcement of the Regulations.

ACIRs are mandatory inspections, carried out by accredited air conditioning energy assessors at regular intervals not exceeding five years, for all air conditioning systems with an effective rated output of more than 12kW, including those which control ventilation, humidity and air cleanliness.

Proposal

To increase the penalty charge for non-compliance with the requirement to have an ACIR for systems over 12kW from £300 to £800 and to maintain the £200 penalty charge for failure to produce a valid ACIR within seven days of it being requested.

ACIRs provide building owners or managers with information regarding the operational efficiency of the air conditioning systems that they control. They provide recommendations to improve performance, thereby saving energy and reducing operating costs.