As required by the Energy Act 2011, regulations have been introduced governing energy efficiency in the non-domestic building space.
Whilst these regulations have already been in place since April 2018 for privately let residential buildings, as of 1st April 2023, the standards will be applied universally to all commercial properties and landlords must ensure their properties have a minimum rating of E unless exemptions apply.
The implementation of MEES is part of the United Kingdom’s wider policy initiative of substantially reducing home emissions by 2050.
How will it affect Landlords
The rules are quite strict and Landlords must comply with MEES in order to let their properties. MEES make it illegal for commercial and domestic properties with a F or G energy rating to be used for tenancies unless exemptions apply.
The new rules apply to most commercial properties, but there are some exemptions. For example, the regulation does not apply to commercial leases running for less than six months or more than 99 years.
The penalty for non-compliance is based on the property’s rateable value and carries a maximum charge of £150,000. Landlords that fall foul of the regulatory change also risk losing rental income, either through failure to achieve an EPC rating of E or above or downtime while building upgrades occur. Additionally, there may be consequences for the property’s overall marketability and it could lead to reduced bargaining power when the time comes for rent reviews.
Further changes to come …
The 2023 changes are only precursor to reaching a new target set by the Government and unveiled in December 2020 to achieve net zero emissions by 2050. This also includes increasing the MEES for all commercial properties to an EPC rating of B by 1st April 2030.
There will be a phased implementation to help Landlords reach these new targets. Compliance window 1 will start in April 2025 and landlords will be required to have a property rating of C or above by April 2027 unless exempt. Compliance window 2 will start in April 2028 and they will then be expected to present a valid EPC of B or above for the property to be compliant.
What should be done to improve the MEES
Improving the EPC rating of your commercial property can be challenging, but here are some tips and advice to assist you:
- Upgrade and replace an old boiler. Opting for a new energy-efficient boiler can cut down energy bills and reduce the building’s EPC rating.
- Install double glazing. Upgrading your windows and doors to double glazing can improve your EPC rating and reduce noise.
- Install wall insulation. Insulating your walls can reduce your EPC rating significantly, making sure no energy is lost.
- Install a renewable energy source. Installing solar panels can improve your EPC rating and provide you with cheaper, greener energy.
- Your Focus 360 Energy efficiency assessor providing the EPC rating / MEES will suggest the most effective improvements that can be made.
