Minimum energy efficiency standards and EPCs
What are the energy efficiency laws for rented properties and have they changed?
Today, more than ever before, there’s a huge focus on the impact we have on the environment. The world is getting greener, and both major political parties have made pledges to make the UK carbon neutral within the next 30 years.
The UK has pledged to reduce its greenhouse gas emissions to net zero by 2050, meaning it will only take as much planet-warming gases - such as carbon dioxide - out of the atmosphere as it puts in.
By 2050, we are legally required to have reduced our greenhouse gas emissions by 100% from 1990 levels.
Over the last decade, the laws around energy efficiency in rented properties have tightened and there are now minimum standards.
Taking action to make the UK’s homes more energy efficient would have a significant impact on our carbon footprint– 16% of our total carbon emissions come from our homes, with the average home in the UK losing heat three times faster than a German property.
This is largely due to the fact that the UK has some of the oldest homes and worst insulated homes in the world.
For the vast majority of private landlords, this means you cannot now let a property unless it has a minimum rating of ‘E’ on the Energy Performance Certificate and there are fines of up to £5,000 if you don’t achieve this rating, subject to some exemptions.
You can read more about the minimum energy efficiency standards for landlords in our article here.
It’s also important to realise that these are minimum standards – a level of energy efficiency that a rented home cannot fall below – and there is a lot more you can and should do to go over and above this basic level.
Indeed, until September 2023 government proposals were that by 2025 it would be a legal requirement for newly rented properties, and by 2028 for existing tenancies, to have a minimum EPC C rating.
However, in September 2023, the Government finally responded to a consultation into improving the energy performance of privately rented homes, which took place in January 2021, and there are now no plans to introduce new energy efficiency standards for rental properties.
C or above
D or E
Below E
My property is exempt
The Government revised its plans to reach netzero by 2050, to ‘ease the burden on working people’ and this involved scrapping several green policies that affected landlords but were part of its key net zero pledges.
This included minimum EPC rating C levels for rental properties and phasing out gas boilers. So, for now the existing minimum EPC rating of E remains in place.
According to the National Residential Landlords Association (NRLA), a lot of landlords were selling properties because they thought they couldn't get them up to an EPC rating C, and some were not buying properties unless they were EPC C and above.
Others had already committed to carrying out energy efficiency improvements, with one study revealing that 80% of landlords were already prepared for the 2025 EPC regulation deadline.
Nearly half of those quizzed had spent between £500 and £20,000 on improving or investing in their properties over the past year.
Responding to the Government’s announcement scrapping proposed energy efficiency targets for households, including rental properties, Ben Beadle, Chief Executive of the NRLA said:
We want to see all properties as energy efficient as possible. But the uncertainty surrounding energy efficiency policy has been hugely damaging to the supply of rented properties. Landlords are struggling to make investment decisions without a clear idea of the Government’s direction of travel. It is welcome that landlords will not be required to invest substantial sums of money during a cost-of-living crisis when many are themselves struggling financially. However, ministers need to use the space they are creating to develop a full plan that supports the rental market to make the energy efficiency improvements we all want to see.
