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Minimum energy efficiency requirements for UK property

The Energy Act 2011 along with the Climate Change (Scotland) Act 2009 has introduced the reality of minimum energy efficiency standards for properties in the England and Wales and perhaps Scotland.

 England & Wales

From April 2018, private rented properties must be brought up to a minimum energy efficiency rating of ‘E’. This provision will make it unlawful to rent out a domestic or non-domestic property that does not reach this minimum standard.b2ap3_thumbnail_For-lease-min-epc-requirements.jpg

This requirement is subject to there being no upfront financial cost to landlords. Therefore, landlords will have fulfilled the requirement if they have either reached “E” or carried out the maximum package of measures funded under the Green Deal and/or ECO (even if this does not take them up to an ‘E’ rating).

Where there are costs on landlords (such as time or hassle costs), DECC are committed to ensuring the benefits meet or exceed these. The intention is that landlords would have fulfilled this requirement if they had either reached “E” or carried out the maximum package of measures funded under the Green Deal and/or ECO (even if this does not take them above an “F” rating).

In addition, from April 2016, private residential landlords will be unable to refuse a tenants’ reasonable request for consent to energy efficiency improvements, where a finance package, such as the Green Deal and/or the Energy Company Obligation (ECO), is available.

What happens if a property can’t achieve an ‘E’ rating even with the green deal scheme?

DECC say “It is intended that landlords would be required to reach EPC rating ‘E’ or carry out the maximum package of measures under the Green Deal or ECO (even if this doesn’t take them above F). This is an important safeguard which would ensure there would be no upfront costs for landlords.”

Minimum energy efficiency requirements in Scotland?

The Energy Act 2011 creates the ability for the Scottish Ministers to introduce minimum energy efficiency requirements for property. This differs from England where the Energy Act 2011 states that the Secretary of State must introduce these minimum efficiency regulations.

The Energy Act 2011 outlines the basics of how these minimum efficiency standards should be met which are as per the requirements in England & Wales. Scottish non-domestic energy efficiency regulations may come into force no earlier than 1 April 2015.

More details will be available as Green Deal and other legislation evolves.

Why Scottish Ministers should not set minimum energy requirements in Scotland at the same level as England

The software engine for calculating EPCs, SBEM, calculates the grade of a property in Scotland differently from that in England and generally properties in Scotland appear poorer against those in England. For instance the same building in England may achieve a 'E' rating whilst the same building in Scotland would achieve a 'G' rating.

When setting minimum standards in Scotland, Scottish Government should take this into consideration and ensure that Scottish landlords and the Scottish property market is not disadvantaged. More on these differences, including Scottish Government research in to this can be read here.


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