DAC Beachcroft Real Estate Advisory Alert Tip of the Week: At Last it's Here – Minimum Energy Efficiency Consultation - DAC Beachcroft

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DAC Beachcroft Real Estate Advisory Alert Tip of the Week: At Last it's Here – Minimum Energy Efficiency Consultation

Published On: 4 August 2014

The Department of Energy and Climate Change has issued the long awaited consultation on Private Rented Sector Minimum Energy Efficiency Standard Regulations (Non-Domestic) (England and Wales). This contains proposals to bring into force regulations to satisfy the requirement in the Energy Act 2011 to introduce a minimum energy efficiency standard (MEES) for non-domestic property.

The government proposes to set the MEES at an EPC E rating and says "properties below this standard must install those measures required to reach an E EPC rating". If a property falls below the MEES a landlord will not be able to let it (subject to certain exemptions).

The consultation contains a raft of questions for the real estate industry that address issues such as:

  • The building/lease type that should be caught by the regulations; 
  • Should landlords be required only to make improvements that can be made at no net or upfront cost?
  • The possibility of an exemption where the "improvements" decrease the value of a property;
  • Exemptions where third party consents cannot be obtained, on lease renewals and extensions;
  • The method by which the Government should introduce the regulations – hard, soft or phased.

The regulations, when made, have the potential to cause considerable impact on transactions involving energy inefficient buildings in the non-domestic sector.

The consultation ends 2 September 2014, don't miss your opportunity to have your say, click here.

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