Irwin Mitchell has commissioned a survey* which reveals that less than a third of businesses occupying offices know the energy efficiency rating of the premises they occupy, despite new legislation coming into force this April.
The new Minimum Energy Efficiency Standards (MEES) legislation means that from 1 April 2023 property owners must not continue to let properties that have an EPC rating of F or G, unless they have an exemption, and all let properties will need to have a minimum EPC rating of E.
Of the 500 office property decision makers surveyed, alarmingly, the survey results found that only 31% of respondents know what EPC rating their office needs to be in April, and 19% do not know their office’s EPC rating at all. Another 18% admitted they do not know what needs to be done to be compliant in April. Additionally, 10% of respondents said they do not understand EPC ratings.
EPC – The facts and what you need to know!
EPC stands for Energy Performance Certificate, which is a rating system used to measure the energy efficiency of buildings. EPC ratings are based on a scale of A to G, with A being the most energy-efficient and G being the least energy-efficient. The rating considers factors such as the insulation of the building, the efficiency of heating and lighting systems, and the materials used in construction.
In the context of commercial properties, EPC ratings are important because they are used to determine compliance with minimum energy efficiency standards legislation. This legislation sets out the minimum EPC rating that a property must have in order to be let or rented out.
Having a good EPC rating is not only important for compliance with the law, but it can also help to reduce energy bills and improve the environmental credentials of a building.
Will your lease be affected and what additional MEES Legislation is planned.
The survey highlighted there are also concerns among property occupiers that landlords may pass on the extra costs of upgrading buildings via the service charge or dilapidations claims. Tim Rayner, Joint Head of Real Estate Disputes at Irwin Mitchell, said that office occupiers need to keep an eye on the situation as landlords may prefer not to incur costs and could instead seek to end leases.
Tim Rayner added that these figures should raise eyebrows, particularly given the changes come into force in April and with further new MEES legislation down the line. For example, for all new tenancies beginning in 2025, the government is keen to change the minimum rating to a C.
Does your building meet the minimum requirements, or do you need expert advice on your EPC Rating? If you have a commercial property that may be affected and want to discuss options, please contact us now on 01942 741800.
* All stats derived from Irwin Mitchell's Survey, Redefining the Office – A report on office occupier trends in 2023