Energy

What do the new EPC rules mean for tenants?

By

Zoopla

By
Zoopla

Energy bills can contribute significantly to the costs of running a home, but new regulations on energy efficiency should help renters make a more informed decision on moving

From 1 April, all privately rented homes in England and Wales had to comply with new Government rules with the catchy title – the Minimum Energy Efficiency Standards (MEES).

Under these rules, landlords cannot let a rental flat or house unless the property has an Energy Performance Certificate (EPC) rating of E or higher.

Initially, this applies only to new tenancies and renewals before being extended. [see ‘Are further changes planned?’, below] 

Given that energy bills will form a significant part of your monthly outgoings as a tenant, it’s worth getting to grips with new rules that promise positive changes – including lower energy bills and better insulated homes.

Here we take a closer look.

What is an EPC?

This piece of paperwork shows how much energy a property uses, and how it rates in terms of energy efficiency.

All houses and flats get a property rating from A (most efficient) to G (least efficient). On the EPC, an A-rating is denoted by dark green, while a G-rating is in red.

As well as being a legal requirement if you are buying a home, EPCs are also a legal requirement if you are renting.

All adverts for a property to rent must include the EPC rating, and you should be given a copy of this document at the earliest opportunity – ideally at the first viewing. 

For more information on understanding an EPC, visit How to read an Energy Performance Certificate.

This rainbow-coloured graphic shows the energy efficiency of the property

This graphic shows the current and potential energy efficiency ratings for a property

How to find an EPC rating

There are two ways to find the EPC rating of your house or flat.

  • If you can provide the 24-digit Report Reference Number printed on the EPC report, or provided by the Energy Assessor who produced it, you can retrieve your EPC here.

  • Alternatively, you can also retrieve a copy of the report using your postcode here.

Sleepy doggo

Minimum EPC ratings are designed to provide energy efficient homes for renters

What do the new rules state?

Landlords can no longer rent out homes unless the property has an EPC rating of E or higher.

The older the property, the poorer its energy efficiency is likely to be.

Figures suggest that around 300,000 rental properties still have an F-rating or G-rating – and fall below the new minimum energy standards.

While this number may still seem high, ARLA Propertymark points out it has dropped significantly from 700,000 in 2012.

What do the changes mean for a renter looking for a new home?

If you are searching for a rental flat or house, you may decide an energy-efficient home is a lot more appealing as this means.

  • Cheaper heating and lower energy bills.

  • The property should be better insulated, and may have features such as loft insulation, wall insulation and double glazing to make it more cosy.

  • The property may also have other energy-efficient features, such as a new boiler, new heating controls, new radiator valves and LED lightbulbs.

  • The flat or house may be of better quality and more comfortable to live in.

Equally, once you’ve moved into an energy-efficient home, you may decide you are happy to stay there for longer, as running costs may be more affordable. This could take the hassle and expense of having to look for a new rental property every few years. 

What will the changes mean in terms of your bills?

The changes should mean you pay less for your energy bills.

According to Government figures:

  • The average annual energy bill for a G-rated property is £2,860.

  • The average annual energy bill for an F-rated property is £2,180.

  • The average annual energy bill for an E-rated property is £1,710.

  • This means that if your home is improved from band G to band E, you could see your costs go down by £1,150 a year (as long as there are no wider changes in your energy use).

What will the changes mean for landlords?

As landlords will no longer be able to let properties with an EPC rating lower than E, those owning properties with the lowest ratings who want to continue to have tenants will have to make improvements.

Research from the UK Green Building Council suggests the average cost of raising an F-rated or G-rated property to the required minimum E-rating standard is £1,400. 

What if my landlord breaks the rules?

Landlords who fail to abide by the regulations could face cumulative fines of up to £5,000 (though some exceptions may be in place for buildings of architectural significance).

The problem is it is not clear how these rules will be policed. If your landlord is in breach of the regulations you should see if you have any right to take action under your lettings contract. You could also consider referring your landlord to the local authority.

Are further changes planned?

This latest move is just the start in a phased programme designed to make Britain’s homes more energy efficient – and to help achieve the UK’s legislative targets of reducing C02 emissions for all buildings to near zero.

Over the next few years, the changes will be rolled out to even more properties. The programme will eventually see the minimum standard upgraded.

1 April, 2020 – all domestic buildings requiring an EPC must achieve at least an E-rating, even when a tenancy agreement is already in place and the property is occupied.

1 April, 2023 – all non-domestic buildings requiring an EPC must achieve at least an E-rating, even when a tenancy agreement is already in place and the property is occupied.

2025 onwards – the minimum standard is likely to rise to a D-rating by 2025, and a C-rating by 2030.

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