The new Labour Government has been busy changing the rules on Energy Performance Certificates for rentals and there’s ongoing consultation exercises to decide what changes are needed to decide how EPCs are calculated and what deadlines are to be set for compliance with new EPC ratings.
The Government wants to improve the assessment process used to determine EPC ratings for buildings. The Consultation is to consider a range of new metrics including carbon emissions, the performance of a building’s fabric and its heating system.
It is likely the Government will require assessments to be carried out more frequently than the present 10-year intervals, most likely this will be set at every 5 years. It is also likely that a more rigorous assessment process carried out more frequently will result in landlords paying more for the checks in the future.
As these consultations are ongoing there could yet be changes to the Government’s requirements for EPC ratings but as things stand now all existing tenanted properties should be upgraded to a minimum EPC grade C by 2030 and for new rentals to be upgraded to grade C by 2028.
Experience has shown that the current algorithmic method of arriving at a reliable and valid EPC rating estimate is an inadequate measure of the true energy efficiency of a building.
To improve this, it is likely the rating system will move from a single measure of a building’s performance to several metrics covering the different elements of energy efficiency:
At this time, it is unclear how the scores on each of these metrics will combine to meet the updated Minimum Energy Efficiency Standards (MEES) and any future Decent Homes Standard to be introduced through the Renters’ Rights Bill.
By replacing the current Standard Assessment Procedure (SAP) with a more rigorous Home Energy Model (HEM) the Government argues it will be more transparent and provide a more accurate representation of a building’s carbon efficiency.
These changes will require more assessor training to improve the validity and reliability of a building’s ratings, along with possible sanctions for poor assessment practices. There will also be harsher financial penalties for landlords who fail to comply with the regulations (fines of up to £800).
Perhaps the most challenging element of the proposals will be the new heating system metric.
Aiming to encourage the adoption of low-carbon heating solutions, the Government proposes ranking different heating systems with fossil fuel heating systems at the bottom of the ranking, and heat pumps at the top.
This could potentially lead to higher costs for tenants. More efficient gas boilers can be cheaper to run than some heat pumps, reducing fuel costs for tenants. In our consultation response, we will be making the case for these types of boilers to be ranked as an effective way to reduce energy consumption.
The government is proposing using multiple metrics on EPCs to provide a more complete representation of building energy performance. A single headline metric, like the current EER, is proving to be insufficient to meet the diverse needs of users and policy objectives. In this consultation, the government wants to understand the potential of a range of metrics that could be used in EPCs. The government has considered the following potential metrics:
The government is interested in how such an approach will help support the goal of improving the energy performance of buildings across the country, ultimately benefiting individuals by reducing their energy costs and contributing to wide ranging policy initiatives. The utility of different metrics may differ between domestic and non-domestic buildings, given differences in the way that energy is used in these buildings. When considering the potential of proposed metrics, the government would be interested in views about their suitability and usefulness for both domestic and non-domestic buildings.
Currently, EPCs are valid for 10 years but the consultation proposes reducing this to improve the accuracy and timeliness of energy performance information for properties.
The Government is consulting on a range of different validity periods including as little as two years between assessments.
This raises the question of what happens to existing EPCs and how long they will remain valid for. The Government has stated that its “preference is to allow all existing EPCs to remain valid until the end of their existing validity period and apply any new validity period to new EPCs”. However, it is also consulting on other options such as invalidating all existing 10-year EPCs or providing a transition window before invalidating them.
The Government has also proposed mandating that private rented properties must always have a valid EPC rather than only at the point of marketing and entering a new tenancy. Currently, a landlord is not required to replace an EPC if the same tenancy continues after the EPC expires.
The consultation also includes plans to expand EPC requirements to cover all houses in multiple occupation (HMOs), holiday lets, and listed buildings. Currently, Government guidance states that an EPC is only required for HMOs where the property is let on a joint tenancy.
A 24-month transition period is proposed for HMO landlords to comply with these new requirements.
The Government has also proposed a range of measures to reform the standards of assessment, accreditation and enforcement, improving the overall reliability of the process.
The changes to EPC metrics are expected to be introduced in the second half of 2026, with a transition period to follow. The Government is also working on the development of a Home Energy Model for domestic buildings, which will inform the new EPC methodology and will be consulted on in 2025.
While this will change the EPC calculations, we still await the consultation on changing the requirements for MEES . The Government has, however, confirmed that rented properties will require an EPC C rating for rented properties by 2030.
The EPC consultation is open for input until 26 February 2025. Email responses should be sent to: energyperformanceofbuildingsregulations@communities.gov.uk
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