The need for Energy Performance Certificates (EPC’s) comes from Article 7 of the Energy Performance of Buildings Directive (EPBD), which is a European Union Directive that requires any building which is sold, rented out or constructed to have an EPC.
The EPBD is intended to tackle climate change by reducing the amount of carbon produced by buildings across the European Union. Nearly half of all carbon emissions in the UK come from buildings.
Since 2008 an energy performance certificate has been required on rented property in England and Wales but since April 2012 the legislation was significantly overhauled by the new regulations consolidating a number of EPC amendments.The Recast of the Energy Performance in Buildings Directive was translated into UK law under the Energy Performance of Buildings (Certificates and Inspections) (England and Wales) (Amendment) Regulations 2012.
So from January 2013 under this legislation, whilst the onus remains on the ‘relevant person’ (i.e. the seller or landlord) to commission an EPC before marketing, the following are legal requirements:
- All advertisements for either selling or renting property must clearly show the energy rating of the building. This is not confined to on-line advertising but includes newspapers, magazines and any written material produced by the landlords/estate agents and letting agents. Whilst the need to display the front page, if there is enough space, the advertisement should show the A-G graph. It is no longer possible to include only the asset rating;
- The seller or landlord must give an EPC free of charge to a prospective buyer or tenant as soon as possible with a copy also provided to the successful buyer or whoever takes the tenancy;
- The current 28 day period within which an EPC is to be secured using ‘reasonable efforts’ is reduced to 7 days and if after that 7-day period the EPC has not been secured the relevant person will have a further 21 days to do so;
- Air conditioning reports must be registered.
Forthcoming EPC Regulations 2018
From the 1st April 2016 (as part of the forthcoming wider EPC Regulations 2018) there is a separate element under which a tenant can apply to the landlord either for them to make energy-saving improvements to the property or for consent to be granted by the landlord for the tenant to carry out energy efficiency improvements themselves. Landlords cannot refuse consent without good reason.
Any property that has an Energy Performance Rating (EPC) of less than ‘E’ must now carry out works to improve it to a rating of E or above, or face penalties of up to £4,000. There are however some instances in which a landlord can refuse permission for improvements to be made, such as:
1: The tenant made a request within the preceding six months and the landlord complied;
2: The improvement is the same, (or substantially the same) as one which the landlord proposed within the preceding six months but which the tenant either refused or failed to respond to.
The Energy Efficiency Regulations will come into force for new lettings on 1st April 2018. It will be illegal to both market and rent a property with a rating less than F or G. Existing tenancies will not be able to be renewed from 1st April 2020 for the same reason and from 1st April 2023 this will apply to all existing tenancies in addition to any new ones that may be granted. So any rentals that still fall in the ‘F’ and ‘G’ performance category will place those landlords in regulatory breach (unless there is an exemption). A civil penalty of up to £4,000 will be imposed for breaches.
Note: These regulations will not however apply to lettings of less than 6 months or long leases above 99 years.
A property will also be exempted if it has:
- a) already had energy saving measures put in place or b) no such measures can be undertaken;
- Third party consent is unobtainable from parties such as planning departments, mortgage lenders, superior landlords or in instances where consent to access the property is not given;
- When any independent surveyor states that such energy upgrades would reduce the property value by more than 5% or cause damage.
WHO ISSUES EPC’S?
EPC’s are issued by Domestic Energy Assessors (who must be qualified and accredited) and they are responsible for registering the certificate on the EPC Register where they are available to view or download free of charge. The register can be searched either by the address or by the Register’s RRN Reference number. Improvements will also be recommended such as:
- The installation of wall insulation (inside and out);
- Upgrading a boiler or:
- Double/triple glazed windows.
All buildings are assessed on a scale of A (most efficient) to G (the least efficient) with the average rating of an EPC being D. Older homes rate between E and G and new builds are rated between A and C.
Powers of Trading Standards Officers
Trading Standards Officers (TSOs) have the power to get the ’relevant person’ (i.e. the seller or landlord) to produce copies of the EPC for inspection and to take copies if necessary. The power to get the production of documents is now extended to include persons acting on behalf of the seller or landlord – e.g. estate agents and letting agents. This means that TSOs for example will be authorised to get estate agents to produce evidence showing that an EPC has been commissioned where they are marketing a building without one.
TSO’s also have access to the Landmark Registry where all EPCs are stored.