June 1, 2021

Improving Minimum Energy Efficiency Standards – opportunity or overload?

MEES for non-domestic privately rented buildings in England and Wales will be tightened to require an EPC rating of B by 2030 where ‘cost-effective’. The Government is currently consulting how this will be implemented and enforced, with a decision expected on 9th June. So does MEES prove an opportunity to help combat climate change or yet another burden overload for landlords?

Energy Certificate - EPC Rating
Energy Certificate for Landlords

Improving energy efficiency of the UK’s existing housing stock is a key measure in the ongoing battle to tackle climate change. The current consultation aims to provide businesses, landlords and investors with more information on how to reduce energy consumption and lower carbon emissions, possibly through the installation of efficiency measures, an auction process or an energy efficiency obligation.

Government estimates state that offices, retail space, hospitality and industrial buildings account for up to 80% of private sector buildings energy demand. When you consider that nearly half of all the energy consumed in commercial and industrial buildings in England and Wales is in the rented sector, the pressure is on landlords to make the lion’s share of these energy efficiency improvements.

Whilst we await the results of the Government’s consultation in early June, we can only speculate as to the outcome. However, some experts are suggesting that there will be a proposed increased in the minimum EPC rating from E to B. So what will be the impact of this?

Simon Green, Managing Director at Green Building Design Consultants, who specialise in low energy building design, comments “EPCs were introduced in April 2018 as a stepping stone on the road to a carbon neutral future. Considered a nice to have by some, more and more questions are being raised over their accuracy with research showing that 60% of EPCs actually have errors and 75% are so substantial they could change the rating by 1 or 2 letters.

Regardless of accuracy, to get every building in the UK up to an EPC rating of B will be tremendously difficult to achieve and puts immense pressure on landlords. Personally, I cannot see this being the outcome of the consultation. Yes the Government will use MEES to increase the energy efficiency of existing housing stock and it will get a lot harder in the years to come, but I think they will do so through other methods.”

To achieve the carbon targets in 2050, many experts estimate that we all need to reduce our carbon footprint by 50% in the next nine years for this to be achievable. So what other methods could be used to help us reach this target?

Simon explains “Government are already making strides in removing gas boilers and I see that this will continue and I predict they will do all they can to remove gas as an option for heating our buildings and hot water in the future. Personally, I anticipate a carbon tax being introduced on gas as it is currently too cheap, especially when you consider that electricity is four and a half times more expensive. I expect the outcome of the consultation to focus more on making our grid as green as possible by using electricity rather than fossil fuels. I see an increase in PV on every roof, supported by an incentive scheme to encourage uptake and I see all gas boilers being removed and replaced with both electrically driven heating and cooling or air source heat pumps.”

So, whilst the MEES Regulations provide a key opportunity to take us towards an energy efficient future, the Government must ensure that they do not issue legislation which becomes an overwhelming and unrealistic burden for landlords and businesses around the country.

We wait to see what “cost-effective” will mean in terms of implementation of raising MEES and how the Government intends to proceed in June.

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