Commercial energy efficiency deadline looms

18th January 2023

Commercial energy efficiency deadline looms

As the New Year dawned, the deadline for ensuring that commercial properties have a minimum EPC rating of E and above drew ever closer, writes Nyree Applegarth, Partner in the Dispute Resolution and Litigation team at Higgs LLP.

The Minimum Energy Efficiency Standards (MEES) apply to new and renewal leases as from April 1 2023 and it is thought that 10% of leased commercial properties are expected to fall short of the standard.

Even for those landlords who have taken some emergency short term measures to ensure that their buildings have the required EPC standard, the pressure is not off because by 2030 all properties will need to have an EPC rating of B and above to be able to comply with the law at that time.

It is thought that only 12% of commercial buildings currently have an EPC rating of B and above and, therefore, there is a considerable amount of investment that needs to be undertaken in the next seven years.

Complying with the MEES regulations is no longer something that can be ignored. It will be unlawful to let property with a rating of less than E as from April 1 2023 and if landlords are unwise enough to enter into leases in any event, the penalties are very significant.

Letting a property in breach of the MEES regulations can lead to a fine of an equivalent of 10% of the property’s rateable value which is subject to a minimum penalty of £5,000 and a maximum of £50,000. After three months, this increases again and the penalty rises to 20% of the rateable value with a minimum penalty of £10,000 and a maximum of £150,000.

£50,000 could go a very long way towards paying for works to improve an EPC rating on a building and would be preferable to a landlord finding itself in a situation where they are suddenly being required to pay hefty fines within a very short period.

If you require any advice in relation to the MEES regulations and how to comply, please contact Nyree on or 01384 327151.


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