Minimum Energy Efficiency Standards (MEES) are changing.
Written by Rebekah Putnam | Commercial Property
Currently, to let a commercial property, the rating must be an EPC E or above. This has been the case since 1 April 2018 as the PRS Regulations 2015 made it unlawful for Landlords to grant a new tenancy of a property with an EPC below E in scope with the Minimum Energy Efficiency Standards (hereinafter called ‘MEES’). That is, unless an exemption applies and has been validly registered.
This has been in place for almost 4 years now, but things are about to change again. From 1 April 2023 this minimum standard will apply to all privately rented non-domestic properties, regardless of whether there has been a change in tenancy or not. This means that all currently let properties will need to meet the minimum standard EPC rating of ‘E’ to be complied with the new regulations.
This is all in aid of gearing up for further, more advanced changes to take place in the future. From 1st April 2027 the minimum rating in scope of MEES is set to change from EPC E to EPC C as a stepping stone for 1st April 2030 whereby all commercial properties will need to have a minimum EPC B to be let out, as set out in the Government Consultation here.
Landlords therefore only have 4 years left to assess, finance, implement and improve the energy efficiency in their lettable properties which is likely going to have an impact on costs over the coming years. If you are looking to let or sell your commercial property, then Property Agents will be talking about this requirement and advising that an EPC is provided at the outset. The government are also encouraging agents not to even accept the advertisement if the EPC is below that which is required.
If you are a Landlord and have a sitting Tenant or are a Tenant and want to sublet; then EPC ratings needs to be a topic of conversation as soon as is practicable.
The first step might be to check you current energy rating and consider getting a new EPC and Recommendation Report to assess how you can improve the energy efficiency of your building. It is important to always check the terms of your current Lease to see whether you need to comply with any terms in accordance with obtaining an EPC and access to the property. If appropriate, consider whether your building is likely to be accepted for one of the exemptions. Click here for published guidance on Private Rented Sector Property (‘PRS’) exemptions and Exemptions Register evidence requirements for non-domestic private rented property.
The MEES Consultations 2019 and 2021 which explored the issues around implementation, enforcement, and delivery of minimum efficiency standards for EPC B by 2030 closed on 9 June 2021 and a response is expected and due for both consultations shortly. This will be followed by legislation, with amendments to the Energy PRS Regulations set to come into force on 1st April 2025. The 2020 Energy White Paper confirmed that the future trajectory for the non-domestic MEES will be EPC B by 2030.
Speak to a Commercial Property Solicitor
If anything in this article has stirred your interest, please contact our Commercial Property team. The team is lead by Nick Winslet, who can be contacted on 01752 827013 or at nwinslet@nash.co.uk. Nick and the team would love to talk to you about how they might be able to help you.
