Forthcoming regulations will forbid the letting of commercial buildings below a minimum energy performance rating after 2018. Adrian Gladstone, associate partner in the Bristol office of property consultancy Sanderson Weatherall, discusses the upcoming regulations and considers the potential impact for commercial landlords and possible ways forward in improving the energy performance of their buildings.
Figures suggest that 18% of commercial properties in the UK currently have an Energy Performance Certificate rating of F or G, and a further 20% have a rating of E. 
Under the 2018 Energy Performance Certificate (EPC) Minimum Standards Regulations, landlords will only be able to let properties if they have achieved a minimum EPC rating band of E, or ‘Minimum Energy Performance Standard’ (MEPS)
The new regulations will have significant implications for landlords and occupiers who wish to assign or sub-let space. Most notably, it will be impossible to market properties with F and G ratings unless they are upgraded to meet the minimum standards. Property and rental values could also be negatively affected.
The level of penalty has not yet been disclosed but is likely to reflect the rateable value of the property, with fines in the region of £5,000 to £150,000 depending on the length of the non-compliance and the rateable value of the property. There will also be a penalty of £5,000 for providing false or misleading information to the exemptions register.
Landlords need to identify any properties they own which fall below the EPC rating and complete works to raise the energy standard. Works do not necessarily mean expensive energy-efficient upgrades. In some cases, minor alterations, such as refurbishing the external fabric of the building as part of normal cyclical maintenance, could upgrade the rating.
With just over a year until the regulation comes into force, landlords should contact a building consultant to ensure they’re compliant.
Adrian Gladstone provides a range of building consultancy services to clients across all commercial and residential property sectors in the South West. To find out more about Sanderson Weatherall’s services, visit www.sw.co.uk
