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MEES – The final countdown

Published 23 marzo 2023

Next month heralds a new era for energy efficiency in buildings in England and Wales. From 1 April 2023, under the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 (SI 2015/962) (MEES Regulations), it will be an offence for a landlord to continue to let a property with an EPC rating below “E” without an exemption or legitimate reason.

This note is concerned with non-domestic properties which are covered by Part 3 of the MEES Regulations.

Unless they can rely on an exemption or have a legitimate reason not to carry out such works, landlords which let properties which fall into the “sub-standard” category will be required to carry out works to improve the energy efficiency of their buildings to avoid committing an offence under the MEES Regulations.

We have previously set out the detail of the legislation and considered what landlords could and should be doing to prepare themselves for the new rules so please do take a look at our article here.

Whilst there is little doubt that the Government’s ambitions to reduce emissions are entirely appropriate, the scale of the challenge of retrofitting existing buildings is immense. There is very little on offer by way of relief for landlords, who could face huge bills for the improvement works.

In the current economic climate, tenants faced with ever increasing energy costs will naturally gravitate towards the most energy efficient buildings and some estimates suggest that tenants, in future, will expect at least a 10% rent reduction for a property which is sub-standard or shun them altogether. Landlords faced with the demands of tenants who are also increasingly placing ESG matters high on their agendas, will need to ensure that they are carrying out improvement works which, not only comply with the legislation, but also future proof their properties against these risks. Indeed, most larger landlords will have their own ESG agenda and will want to ensure their buildings are as efficient as possible to comply with their own targets.

What is clear is that landlords need to act now, keep an eye on updates and developments in this fast moving area and take advice to ensure they are as ready as they can be for the inevitable future changes.

Authors

Stephanie Bagshaw

Leeds

+44 (0) 113 251 4879

sbagshaw@dacbeachcroft.com

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