In recent weeks, industry magazine The Energyst has reported:
‘The government has published guidance for landlords on the new regulations that could prevent them from renting buildings to tenants if they fail to meet minimum energy efficiency standards.’
It’s a crucial development. The Minimum Energy Efficiency Standards (MEES) come into force in April 2018. But preparatory action now is needed, both to understand MEES implications and get ready for potential remedial works.
The minimum level of energy efficiency provisions will mean that, subject to certain requirements and exemptions:
a) from 1 April 2018, landlords of non-domestic private rented properties (including public sector landlords) may not grant a tenancy to new or existing tenants if their property has an EPC rating of band F or G (shown on a valid Energy Performance Certificate for the property).
b) from 1 April 2023, landlords must not continue letting a non-domestic property which is already let if that property has an EPC rating of band F or G.
This means some 1 in 5 UK commercial buildings would fail the MEES test, and the maximum fine for failure to comply with MEES stands at £160,000 per property.
Therefore, it’s critical that landlords across the UK take notice, right now, of the implications. When implemented well, MEES stand to make UK property substantially more sustainable, and improve the quality of rented space for tenants.
Reputational benefit, longer term tenants and a more profitable portfolio are among the wins for landlords. But to reap such rewards, the sector as a whole must react promptly to what MEES will mean.
What does the guidance say?
The guidance sets out, via a number of flowcharts, the decision process whereby landlords can judge whether a property can legally be let under MEES regs. It also details the MEES laws in depth.
This alone is useful. UK environmental legislation is complex. Pathways to help landlords examine their responsibilities, and set about meeting them are most welcome.
“We recommend that every UK commercial landlord consults the MEES guidance immediately,” explains Kevin Cox, Managing Director, Energys Group.
“It’s vital to do this for a number of reasons. Firstly, you need to comply. You need to plan out any costs, and the timeline of getting energy efficiency in your buildings up to standard.
“All of these elements will affect your business, your profit, your planning and your tenants. Often, the response to rules like MEES is to hide one’s head in the sand.
“That simply won’t wash in this case. MEES are here, and it’s essential to comply. There are huge benefits for landlords who do. You can win new business, based on your reputation as a sustainable letting agent.
“You will hold tenants for longer, who prefer the more comfortable heating and cooling systems in your sustainable, intelligently managed buildings. You will be ahead of the game; an example of futureproof, modern business.
“And of course, you will save money on potential fines, while your energy efficient buildings will command higher rents than the competition.”
Energys Group offers free site surveys to guide you on the most cost-effective energy efficient solutions for your building. Get in touch for advice.