Minimum Energy Efficiency Standard

Published: 12/03/2018

As of 1st April 2018 it will be a requirement for any properties rented out in the private rental sector to have a minimum energy performance rating of E according to the Energy Performance Certificate (EPC) associated with that property. The regulations will come into force for new lets and renewals of tenancies with effect from 1st April 2018 and for all existing tenancies on 1st April 2020.
This regulation has been put in place to ensure that those tenants who most need energy-efficient homes are able to enjoy a much better standard of living and lower energy bills. Although newly built homes in the private rental sector tend to have higher energy-efficiency ratings than the average, there remains a stock of older, period properties, many of which have poor energy efficiency and are difficult and costly to heat. These less efficient properties result in higher tenant energy bills and, for many, an increased likelihood of living in fuel poverty.
While tenants will benefit in terms of their reduced energy bills or through increased warmth comfort and the associated health benefits, energy efficiency improvements also benefit landlords. When the Regulations were designed, a number of landlord associations identified a range of benefits for landlords including: increased tenant satisfaction and reduced void periods, reduced long-term property maintenance costs, and improved desirability of their properties.
Indeed, a report by Sustainable Homes in 2016 on social housing demonstrated that improving the energy efficiency of rental housing reduced both rent arrears and voids. Recent data has also shown that increasing a property’s energy efficiency may increase the market value. With these quantifiable benefits to hand, landlords should see the new regulations as an opportunity to maximise rental value and return on their properties, and tenants should in turn enjoy lower energy bills as a result of their implementation.