Energy Efficiency – The Domestic Minimum Energy Efficiency Standards (MEES)

“Energy efficiency…is critical to making our homes cheaper to heat. That’s why we’ve got big government grants like the Great British Insulation Scheme. But under current plans, some property owners would’ve been forced to make expensive upgrades in just two years’ time.”
“And…if you’re only renting, you’ll more than likely see some of that passed on in higher rents. That’s just wrong. So those plans will be scrapped, and while we will continue to subsidise energy efficiency - we’ll never force any household to do it.”

Prime Minister Rishi Sunak has set out his new approach to Net Zero, part of which involves discarding the proposed EPC targets.

First introduced in July 2021, the Minimum Energy Performance of Buildings Bill called for all new tenancies to have a minimum EPC rating of C from 2025 (and existing tenancies by 2028). Since 2021 there has been no further detail, and no confirmation of this deadline, which has left landlords confused about whether or not to make improvements now.

We have been working with our clients over the last few years to ensure they were prepared for 2025, by carrying out property improvement plans and suggesting quick wins where appropriate. Though the time pressure is off, we will continue to encourage our landlords to plan to gradually improve the energy efficiency of their properties, as there are benefits to making a property as energy efficient as possible, and we would view it as part of a home’s quality.

Throughout 2023, the energy efficiency of a property has become a bigger part of the conversation with applicants. Although the EPC rating has not yet been a deal breaker for any lets, it should remain a focus for landlords as it could become a factor in rental value; a report from Rightmove found that nearly half of renters would pay more for an energy efficient home:

With the cost of living being so high, we foresee properties with a higher EPC rating being at a clear advantage when up against a similar property with a lower rating. As such, we recommend landlords do what they can to improve energy efficiency to ensure their property remains sought after. It’s also worth keeping in mind that improvements resulting in increased energy efficiency will also increase the value of the property and make it more desirable to purchasers when the time comes to sell.

Published September 2023