Why are EPCs being upgraded?
The Government’s Environmental Audit Committee recently instigated a consultation exercise in which were collected the combined gripes of many property and sustainability experts, all of whom agree: the way the rating in the Energy Performance Certificates (EPC) is currently calculated, based on standardised data, leads to anomalies in its representation. Focusing as it does on cost, not the real-life energy usage and carbon performance of running a building, these anomalies became ridiculous.
For example, the energy performance rating system (EPC) used at present is based on the efficiency of heating a building using natural gas. This is because this has been the cheapest and the most effective form of heating, but when you use LPG or when you up-grade to an electrical heating system, or using a heat pump, the result is the EPC rating actually falls.
These inconsistencies and inaccuracies in the existing EPC calculation mean that property owners can currently pay out thousands of pounds for work that, when they come to test or to sell the property, they find they actually lowered their EPC rating.
The energy sector has been scathing about the system. The EPC rates buildings from A to G but experts are saying the current system is 'not fit for purpose' because the rating is based on the cost of energy used, not on the actual carbon emitted into the atmosphere.
It punishes people for installing heat pumps because they use more electricity and LPG gas because it's more expensive than natural gas - it incentivises the use of mains gas over electricity or LPG.
Tom Spurrier, of the UK Green Building Council, a leading industry body, has said:
'We have currently got a metric that incentivises gas because it is cheaper.' If you install a heat pump, which is powered by electricity, your EPC rating may fall. Properties with Liquid Petroleum Gas (LPG) are also marked down because the gas is more expensive than mains gas.
The replacement is the Home Energy Model which will use a new Future Homes Standard assessment in which energy assessors will measure:
1 - all the windows at the property, rather than relying on assumptions based on the property’s age
2 - they will carry out additional assessment of rooms and lofts
3 – they will introduce of a new age band for properties or extensions built from 2023 onwards
4 – they will also consider the use of power diverters and battery storage, used in conjunction with solar panels
5 – finally, they will recommend the use of heat pumps more frequently.
This will change the framework by which energy efficiency is calculated to bring the focus instead on to carbon emissions. The assessments will be more in-depth, relying less on assumptions, more on measurements which should give a more accurate picture of the energy efficiency of a building.
The assessments should also provide more accurate information as to what improvements are necessary to bring a building up to a specific energy rating.
EPC surveys and performance ratings were derived primarily as a cost-based rating system, and while they do generate some useful insights, in their current form, the algorithms used produce some inaccurate assessments.
Inevitably, a more in-depth assessment will be more time consuming for an assessor and therefore the cost to the landlord is likely to be higher. Whereas the current EPC assessment takes around 30 minutes and costs anywhere between £60 and £75 using the Standard Assessment Procedure (SAP). This gives an EPC rating between A, highly energy efficient to G which is very inefficient.
The Building Research Establishment (BRE) gives information on its Reduced Data Standard Assessment Procedure (RdSAP).
RdSAP is to be the UK’s officially approved method for evaluating the energy performance of residential properties and used in generating future Energy Performance Certificates (EPCs).
RdSAP is used in assessing existing dwellings where the complete dataset required for a standard SAP (Standard Assessment Procedure) calculation is not available. Instead, RdSAP uses default values and data collected methods during on-site assessments by trained assessors to calculate energy performance.
The launch of RdSAP10 it is said will bring about some of the most significant changes to EPCs ever. The changes have been specifically designed to improve the accuracy of EPCs with Assessors less reliant on the use of “default” values.
It is thought that more accurate EPCs will result in higher ratings on properties that have been assessed under the current EPC software. In all, 30 changes are being introduced to the assessment, examples include:
Insulation – previously assessed in increments of 50mm it will now be assessed in increments of 25mm with a new 10/12mm minimum thickness. This was not previously specified and therefore allows the recording on insulation that is less than 50mm
Windows – all widows will now be measured, benefiting properties with smaller windows or less glazing. The orientation of windows will also be recorded along with their age. Shutters and window insulation will also be considered in the assessment.
Loft conversions and roof rooms – Assessors will need to take additional measurements to account for the various construction types of common wall and gable walls in roof rooms. More data will need to be recorded to accurately reflect the construction types and insulation levels.
Wall thickness – wall thickness is currently included in EPC calculations, but the new version will register improved u-Values for thicker walls. This will benefit older solid wall properties. This will up-grade properties with solid brick and stone walls.
Hot Water Cylinders – the capacity will now be recorded as will the kWh/day figures, replacing the current options of small, medium and large cylinders.
Basements – significantly more data will now be recorded which will include u-Values for the walls. These will differ from above ground walls.
A New age band – for post 2023 constructions such as new extensions and loft conversions.
Lighting – All lighting will be assessed taking into account different lighting types such as LED with low energy bulbs.
Battery Storage – will be taken into consideration in the assessment when combined with Solar panels, not currently an option.
Air pressure leakage tests – currently only used for a new build property, this could be an additional option for owners to undertake to improve ratings.
Annual fuel running costs – will be taken into account.
Improvement recommendations – An air source heat pump is to be a specific recommendation along with solar and battery storage.
The new method of assessment - RdSAP10 – is expected to be launched sometime this year. Assessors are currently being trained and the system is in its final stages of testing with the BRE and other Accreditation Bodies.
With EPC grade C now a definite new standard to be imposed on rental properties by 2030, landlords will be encouraged to improve their properties where necessary and apply for a new EPC under RdSAP10 when available.
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