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The Minimum Energy Efficiency Standards (MEES) were introduced by the government in 2015 to improve the energy efficiency of buildings and help meet the government’s carbon emissions targets. Since April 2018, landlords have not been able to grant new leases of commercial properties that have an Energy Performance Certificate (EPC) rating of below E. This will be extended to existing leases from 1 April 2023, meaning that it will be unlawful for landlords to continue to let properties on existing leases where they have an EPC rating of F or G.
MEES exemptions
There are certain exemptions for complying with the Minimum Energy Efficient Standards regulations. For example, where carrying out the improvement works would devalue the property by more than 5% or where the works would not pay for themselves in terms of energy cost savings within seven years. Landlords must register their exemption on the government register in order for it to be valid, and they must renew the exemption every five years.
What should landlords be doing regarding the MEES regulations?
Landlords should be looking at their portfolios now to ensure they will not be caught out by the regulations and consider whether they will need to carry out any improvement works before April 2023. Landlords may want to obtain advice from Minimum Energy Efficient Standards specialists for any properties they think may be at risk of falling foul of the Minimum Energy Efficient Standards regulations.
It is important that landlords check the ratings of their properties soon as non-compliance with the Minimum Energy Efficient Standards regulations can result in a fine of up to £150,000, based on the rateable value of the property. Landlords can also be ‘named and shamed’ on a public register.
Landlords should note that the government has proposed to increase the minimum EPC rating for commercial properties to a B rating by 2030. It’s likely that the increase will be in stages in the years leading up to 2030, but this is something that landlords should start taking into consideration now.
