‘C’ EPC rating for energy efficiency. A noble target but are landlords paying a heavy price?

With the COP 26 underway in Glasgow and the world leaders attempting to put right what many are saying is our last chance to ensure we don’t head into a full-blown climate disaster. There is a lot of noise in our industry about the move towards a Carbon Neutral UK by 2050, one of the initiatives by the government is to make sure that all houses newly let by 2025 have an EPC rating of C and that continuously let houses have the same rating by 2028.

Whilst most agree this is the right direction to head in, landlords are left to pick up the bill. And some of these bills will be very large. If you are the landlord of a 2 up 2 down £450.00 a month let it makes no financial sense to spend potentially £thousands on a new boiler, windows and insulation.

 

Will there be financial support for upgrades?

The Green Homes Grants scheme was implemented to assist in this process but administration issues cut that short. It is likely we will see something similar in the future. Other than that, it is likely that we may see low-cost loans for landlords to ensure the targets are hit.

The government may look to incentivise mortgage lenders to offer cheap finance to landlords that want to ensure their property moves into the C band. If the Minimum Energy Performance of Buildings Bill is passed it would require individual lenders to achieve an average EPC rating of ‘C’ across all the properties on their books by the end of 2030.

The government has too much political capital invested for the targets to be missed by a mile.

 

Are there any exemptions?

The bill currently says Landlords may not be forced to make the upgrades ‘if they meet the criteria for an affordability exemption’, but, this exemption has yet to be defined.

For owner-occupied properties, the bill says homeowners will be exempt if:

(a) An occupant or anyone else whose permission is needed for works needed to be carried out has explicitly refused such permission;

(b) It is not technically feasible to fulfil the duty; or

(c) The cost of carrying out works to fulfil the duty would exceed £20,000.

 

How do you know what needs to be done?

Check your EPC certificate. You will have one as a landlord and it will highlight areas for improvement. If the certificate is old then you should get it retested.

Having checked your EPC certificate or got it reissued will allow you to put a budget in place to make the necessary changes.

 

How will I know that the work carried out will meet the regulations?

Landlords are advised to choose companies that are:

  • Registered as a certified installer with TrustMark
  • Certified by a body that has been accredited by the United Kingdom Accreditation Service (UKAS)
  • Certified to install energy efficiency measures against one of the following Publicly Available Specification (PAS) standards:
  • PAS 2030:2017
  • PAS 2030:2019
  • PAS 2035:2019 (for park homes, high rise buildings and buildings that are both traditionally constructed and protected)
  • Certified under the Microgeneration Certification Scheme (MCS) to install low-carbon heat measures such as heat pumps

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