Landlords urged to plan ahead in time for new energy rules! Monday, 3rd April 2017

Time is running out for landlords to ensure their commercial buildings are up to scratch in order to meet strict new energy efficiency rules – or face the prospect of being fined up to £150,000.

The new Minimum Energy Efficiency Standard (MEES) comes into force on 1 April 2018.

With just one year to go until its implementation, Ingleton Wood are advising landlords to start planning ahead.

According to Government figures, up to 20% of commercial properties would currently fail to meet the new regulations which will make it unlawful for landlords to offer new leases on commercial properties that have an Energy Performance Certificate (EPC) rating below ‘E’.

Properties thought to be most at risk are those that have had no improvements in the past 15 years or more, with outdated heating systems, inefficient lighting and poor insulation.

David Cresswell, Partner at Ingleton Wood, said now was the time for landlords to check their properties. “With only a year to go until their implementation, landlords need to start thinking ahead and begin planning for the changes,” he said.

He added: “Improvements could include anything from switching to LED lighting or upgrading insulation, through to investing in double glazing or installing a new heating system. It may be that not much needs to be done, or that exemptions apply – however, the fines for not complying are potentially quite substantial.

“Whilst landlords will only have to carry out the work that is necessary to bring the property up to standard, there is the prospect that the MEES threshold could rise again in the future – so this could also prove a timely opportunity to surpass the minimum requirement for long-term security.”

Fines for not complying with the new rules start at a minimum of £5,000, with the worst offenders facing charges up to £150,000.

It is also predicted that failure to meet the regulations could have a negative impact on a property’s value, as well as discouraging potential tenants who are concerned about the prospect of high energy bills.

MEES will come into immediate effect from 1 April 2018, initially only applying to new leases. However, from 2023, the regulation will extend to all existing lettings.

All commercial properties will be subject to MEES if they currently have an EPC, or will require one in the future. However, there are some exceptions, with the legislation not applying to lettings of less than six months or to tenancies over 99 years.

Contact our sustainability team here for further details.