Summary The Scottish Government aims to reduce CO2 emissions and energy use in non-domestic buildings by setting energy performance and emission targets. These targets will be met through identifying and carrying out improvement works to be carried out in the new Action Plan. The Action Plan will be in addition to the EPC and the improvement work measures must be legally met. This legislation take effect from 1st September 2016. These new regulations will have implications when selling and letting property.
Why force minimum standards for energy efficiency in existing buildings?
Research in 2014 conducted by Consumer Focus1 shows that only 17% of those who have received an EPC have acted on the recommendations. EPCs were introduced to reduce energy use and CO2 emissions and perhaps a lack of action by building owners has required mandatory improvements to be made. Minimum requirements have resulted from a recent EU directive, resulting UK legislation and the Climate Change Act Scotland 2009.
In England and Wales, the Department of Communities and Local Government has announced that by Autumn 2018 buildings for sale or to let will be required to meet a minimum EPC rating (likely an English E, which is often easier to achieve than a Scottish E) before they can legally be sold. In Scotland, rather than set a minimum EPC grade before a building can legally be sold or let the Scottish Government are introducing improvement measures that must be legally met under an Action plan.
Under Section 63, ‘Energy Performance of Non-Domestic Buildings’ of the Climate Change (Scotland) Act 2009, Scottish Ministers must by regulations: provide for the assessment of the energy performance of non-domestic buildings and the emissions of greenhouse gases produced; and require "owners" of such buildings to improve the energy performance of such buildings and reduce such emissions.
Energy performance target and emissions target
The energy performance target for a building or building unit is the amount of energy which is the estimated energy consumption of the building or building unit if the identified improvement works were to be carried out. The emissions target for a building or building unit is the estimated level of greenhouse gas emissions from the building or building unit if the identified improvement works were to be carried out.
The EPC Action Plan and Improvement Measures
Action Plans will be introduced on sale or rent of relevant non-domestic buildings. Where a relevant non-domestic building or building unit is to be sold or let the owner must make a copy of the Action. An Action Plan must include the energy performance target and the emissions target for the building or building unit, specify any identified improvement works for the building or building unit and specify the timescale for implementation.
Duty to implement Building improvement measures
We understand that the maximum permitted timescale for the improvement works is to be 42 weeks from date of the action plan being issued. An action plan may, with the approval of the owner of the building or building unit, specify alternative improvement measures.
The energy performance data relating to the action plan must be lodged with the register before the action plan is made available to a prospective buyer or a prospective tenant.
Where these improvement measures are not undertaken then the owner has the option to begin carrying out an annual Display Energy Certificate (DEC). A display energy certificate for a building or building unit must include the operational rating for the building.
Buildings that are exempt to the Section 63 regulations include.
l Buildings less than 1,000 sq m.
l Properties that have been built subject to the 2002 Scottish building regulations or newer.
l Temporary buildings (such buildings are considered to have an intended life of 2 years or less).
l Workshops and agricultural buildings with low energy demand.
l Buildings participating in the Green Deal scheme.
l Prisons and young offender institutions.
The trigger point for the section 63 part of the new legislation would be a sale or lease.
Section 63 Exempt transactions for Action Plans means the lease of a building on a short term lease (12 weeks or less), the sale or lease of a building or building unit at any time before the construction of that building or building unit has been completed or the renewal of an existing lease with the same tenant.
It is intended that the section 63 regulations would be brought into force in autumn 2015. It is thought that the original EPB(S) R and amendments should be consolidated and the S63 CCSA regulations should be amalgamated into a new EPB(S) R.
This guidance is in a draft format and may change.
EXISTING REGULATIONS AMENDED
Displaying EPCs for public buildings
Where property is frequently visited by the public an EPC must be physically displayed in a prominent place. Where the owner is not the occupier, the occupier must ensure that an EPC is displayed within the building in a prominent place clearly visible to visiting members of the public.
This applies in the case of a building occupied by a public authority before 9th July 2015, where the floor area of the building is greater than 500 sq m and on or after 9th July 2015, where the floor area of the building is greater than 250 sq m.
In the case of any other building where the floor area of the building is greater than 500 sq m; and an EPC has been issued in relation to that building.
Reference to "owner"
For the purpose of this regulation “owner” means a person who has right to the building whether or not that person has completed title, but if, in relation to the building more than one person comes within that description of owner, then “owner” means such person as has most recently acquired such right; and “building which is frequently visited by the public” means a building into which members of the public have an express or implied licence to enter and which is visited by members of the public on at least a weekly basis.
Enforcement authorities and penalty notices
Every local authority is an enforcement authority for the purposes of these Regulations and it is the duty of each enforcement authority to enforce these Regulations in its area.
A penalty charge notice applies for non-compliance.
Background to energy efficiency in buildings in the UK and Scotland
Energy Efficiency regulations of buildings in the UK stems from European Directive 2002/91/EC on the Energy Performance of Buildings came into force on 4 January 2003. The objective of the Directive is to promote improvement of the energy performance of buildings and to reduce the amount of carbon they produce.
Buildings account for 40% of the total energy consumption in the European Union. Reducing energy consumption and using energy from renewable sources are of paramount importance in reducing EU energy dependency and greenhouse gas emissions.
This has been reflected in the recast, European Directive 2010/31/EU which was published on 19 May 2010. In essence, the recast has been extended to strengthen and clarify provisions contained within the original Directive.
Click here for more information on: The (Draft) Energy Performance of Buildings (Scotland) Regulations 2013
Metro Commercial specialise in producing Energy Performance Certificates for non-domestic buildings throughout the UK and Section 63 Action Plans in Scotland.