The government has issued guidance on how to comply with incoming minimum energy efficiency standards for non-domestic properties, which will be introduced from April 2018.
From 1 April 2018, it will become illegal to sell or grant a new tenancy lease in England and Wales for a non-domestic property with the lowest Energy Performance Certificate (EPC) rating of F or G. From 1 April 2023, it will apply to all existing leases. Up to a fifth of commercial properties are expected to be affected.
Under the Minimum Energy Efficiency Standards (MEES) regulations, landlords will have to implement energy efficiency improvements which pass a simple payback period test of seven years or less if their property has a rating of less than E, unless it meets exemption criteria.
Landlords will also need to prove to a qualified surveyor or energy assessor that energy efficiency improvements have been implemented and could face sanctions and fines for failing to comply.
In January, a study revealed that affected properties could see their value cut by up to 10 per cent if the owner fails to make the required improvements.
The new guidance document informs landlords how to determine whether their property is covered by the regulations and what steps they should take to ensure it complies with the minimum level of energy efficiency.
The guidance also helps landlords understand the ‘payback test’ and which energy efficiency measures are eligible.
John Alker, campaign and policy director at the UK Green Building Council, said the guidance “provides vital clarity to commercial landlords about compliance and enforcement ahead of the regulations coming into force”.
The purpose of the regulations is to help the government towards its target of cutting emissions from buildings by 50 per cent between 1990 and 2025.
The majority of buildings in place today are still expected to be in use in 30 years’ time, meaning that retrofitting existing buildings will be crucial.