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First steps on the path to a low-carbon future

Energy performance certificate from new home in UK
Energy performance certificate from new home in UK

The government’s Clean Growth Strategy sets out its low-carbon policies and plans aimed at accelerating the pace of ‘clean growth’ – delivering increased economic growth alongside decreased emissions.

Laura Gorman, associate at Penningtons Manches
Laura Gorman, associate at Penningtons Manches

Since its publication in October 2017, the government has progressed a number of the initiatives in the strategy.

Of particular note to the real estate sector will be the current consultation to amend the domestic Minimum Level of Energy Efficiency Regulations (MEES) and changes to its guidance on energy performance certificates (EPCs).

The government has launched a consultation seeking views on a proposal to amend the domestic MEES to remove the ‘no cost to the landlord’ principle and instead to introduce a ‘capped landlord financial contribution element’. This proposal is designed to future-proof the regulations and make them as effective as possible, while protecting landlords against excessive cost burdens. With a cost-cap, domestic landlords would only need to invest in improvements to an EPC F or G rated property up to the value of that cap. The government’s preferred cap level is £2,500 per property.

The government’s analysis indicates that a cap of £2,500 will enable approximately 30 per cent of F and G rated domestic properties in England and Wales to be improved to an E rating, equating to around 85,000 properties. The remaining 70 per cent (around 195,000 properties) could be expected to take some action within the cost cap while not achieving a band E rating.

The government has also recently published new guidance on both domestic and non-domestic EPCs. This guidance is intended to help those dealing with domestic and non-domestic property to understand how the relevant EPC regulations work and where the responsibilities lie. The main change to the guidance clarifies whether listed buildings and buildings within a conservation area require an EPC to be provided on sale or letting.

The energy performance regulations provide that ‘buildings protected as part of a designated environment or because of their special architectural or historical merit’ are exempt from the requirements to have an EPC if compliance with MEES would ‘unacceptably alter their character or appearance’.

It was previously unclear whether non-listed buildings located within a conservation area would fall within this exemption, but the new guidance clarifies that both listed buildings and those within a conservation area will constitute ‘buildings protected as part of a designated environment or because of their special architectural or historical merit’.

The guidance notes that building owners will need to take a view as to whether this will be the case for their buildings. If there is any doubt, it recommends that owners seek the advice of their local authority’s conservation officer.

Laura Gorman is an associate at Penningtons Manches. Contact Laura at 01865 813702 or email laura.gorman@penningtons.co.uk.

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