Happy 10th Birthday to the EPC! (Part One)

20/10/17

It’s been 10 years since the introduction and implementation of the Energy Performance Certificate (EPC) in August 2007. The document was originally a part of the Home Information Pack (HIP) for domestic properties, the objective of which was to include recommendations on ways to improve a property’s energy efficiency in order to save money.

So, why is the EPC’s 10th birthday important?

There is a possibility some EPCs may be due to expire this year after being issued 10 years ago. It may even mean that the earliest EPC’s have already expired and are invalid.

Each certificate will last for 10 years unless major renovation work is carried out on the property.

I can’t Find my EPC?

If you do not have or can’t find a copy of an EPC for your property, you may be able to access a copy online if one already exists. If you are in England or Wales, you can enter your postcode into the Landmark register.

Remind me, what is an EPC?

An Energy Performance Certificate (EPC) is a report that assesses the energy efficiency of your property and recommends specific ways in which the efficiency of your property could be improved to become more environmentally friendly and to save money.

EPCs tell you how energy efficient a building is and give it a rating from A (very efficient) to G (inefficient). EPCs let the you know how costly it will be to heat and light the building, and what its carbon dioxide emissions are likely to be.

The recommendations are bespoke to each property and are to be cost effective in improving the energy efficiency of the home. The EPC also outlines what the energy-efficiency rating could be if improvements are made, highlighting the cost-effective ways to achieve a better rating - such as switching to more energy-efficient light bulbs or improving insulation.

Do I need an EPC?

A property (domestic or commercial) must have an EPC before it can be sold or leased.

Energy Performance Certificates (EPCs) are needed whenever a property is:

  • Built
  • Sold
  • Rented

An EPC is required for;

  • An individual house or dwelling (i.e. a self-contained property with its own kitchen/bathroom facilities)
  • Self-contained flats (i.e. each behind its own front door with its own kitchen/bathroom facilities) - one EPC per flat.
  • Shared flats/houses (e.g. a letting of a whole flat or house to students/young professionals etc. on a single tenancy agreement) - one EPC for the whole house.
  • Mixed self-contained and non-self-contained accommodation - one EPC for each self-contained flat/unit but no EPC for the remainder of the property.
  • A room in a hall of residence or hostel - no EPC is required.

No EPCs are required for bedsits or room lets where there is a shared kitchen, toilet and/or bathroom (e.g. a property where each room has its own tenancy agreement) or a room in a hall of residence of hostel.

As a landlord, you must be able to show prospective tenants an up-to-date EPC.

There are also exemptions where an EPC is not required which are shown on the Government website https://www.gov.uk/buy-sell-your-home/energy-performance-certificates. If you are letting a commercial property, you will need a specific commercial EPC.

IMPORTANT CHANGES:

From the 1st April 2018, new ‘Minimum Energy Efficient Standards’ (MEES) will take effect. This means that as a landlord you cannot grant a new tenancy with an Energy Performance Certificate with a rating lower than an E. This would include a tenancy moving from a fixed term to a statutory periodic tenancy.

Where a property is rated band F or G landlords will need to make improvements to the property to raise the EPC band to a minimum level of E. However, there are exemptions to this which are:

  • the landlord is unable to obtain funding to cover the cost of making improvements; or
  • where all improvements which can reasonably be made have been made, and the property remains below an EPC rating of Band E

This means if a landlord cannot obtain funding to carry out the recommended improvements, he will be exempt from meeting the minimum energy efficiency level of band E. The funding on which a landlord may rely, for the recommended improvements can be one or a combination of the following:

  1. A Green Deal Plan;
  2. Energy Company Obligation or similar scheme;
  3. Funding provided by central government or local authority or third party at no cost to the landlord;
  4. A combination of any of the above.

Where funding can be obtained to cover the cost of the recommended improvements, the landlord must undertake the required work. If funding is unavailable to cover the whole cost then the exemption applies. This is because the energy efficiency regulation is based on a principle of ‘no cost to the landlord’, which is why unless funding can be sought entirely for all the improvements, the landlord is exempted from carrying them out.

Where such an exemption applies, landlords will need to register the exemption on the national PRS Exemptions Register.

From April 2020, all rented properties must have an efficiency rating of E or above.

What happens if I don’t have an EPC?

It is a requirement for ALL domestic and commercial properties that are available to buy or rent, to have an Energy Performance Certificate (EPC) and it is against the law to advertise a property without having a valid EPC. ALL landlords must obtain the certificate before the property can be offered for rental and must be available to show prospective tenants, otherwise you may face penalties. You must use an approved Domestic Energy Assessor to produce the EPC.

The provision of EPCs is enforced by the Trading Standards department of the local authority and failure to provide a valid EPC, can result in a penalty charge of £200 for each breach. Also, landlords can face a penalty of up to £4,000 for not meeting the minimum ‘E’ rating.

What to Look for in an EPC?

An EPC displays your properties EPC rating - an energy efficiency rating from A (most efficient) to G (least efficient) and is valid for 10 years.

Do I have to improve my property from the EPC Recommendations?

You are currently NOT legally obligated to act on any of the recommendation to improve the efficiency of your rental property in the report. However, from April 2018, landlords will be legally obligated to make energy efficiency improvements if the report comes back with a report lower than a grade E.

As of April 2016, tenants are allowed, to ask permission from their landlord to undertake energy efficiency improvements on their privately rented property. The idea is that it will help them reduce their running costs.

What if I have already made changes to the property?

Property owners can voluntarily request a new certificate after implementing energy efficiency measures with the view to improving its energy rating. If a newer EPC has been produced for a property within the 10-year period, only the most recent one is valid.

If your EPC states that either loft or cavity wall insulation is required you must ask an assessor to produce a second EPC after installing the insulation to prove that you have done this.


Marcus James is Lettings Manager at Pace Plc, an independent Southend on Sea Letting Agent. He deals with every aspect of the property letting process, providing expert and candid advice together with tailor-made marketing plans for each property he lists for rental.

Marcus prides himself on ensuring our landlord clients get the best return in the right timeframe for their investments by conducting rental appraisals, letting viewings and oversees the running of the lettings department.


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