NON-DOMESTIC RENTED PROPERTIES
EPC REGULATIONS

NON-DOMESTIC RENTED PROPERTIES – EPC REGULATIONS

Changes to the Energy Act 2011 provide for powers to ensure that from April 2018, it will be unlawful to rent out business premises that do not reach a minimum energy efficiency standard. Energy Performance Certificates (EPC) rate how energy efficient your building is; using grades ‘A’ to ‘G’ (with ‘A’ being the most efficient). The regulations will require landlords of non-domestic buildings to have secured an EPC certificate with an E rating or higher in order to issue a new lease for a property. This will come into force on 1st April 2018. The additional requirement to secure an EPC certificate for properties with existing leases will come into force from 1st April 2023.

A summary of the key points can be seen below:

EPC Regulations – Non Domestic
Key points
Scope Non-domestic private rented sector in England and Wales
Minimum Standard E Rating on EPC
Application 1st April 2018 – granting of new lease to new or existing tenant
1st April 2023 – All privately rented properties in the scope of the regulations
Restrictions on Improvements Not cost effective on 7 year payback
Cannot gain consent for works from tenant, lender or superior landlord
Expert states that measure will reduce property value by 5% or more
Wall insulation will damage the property
Enforcement Local authority
Exemptions Exemptions to be recorded on register
PENALTIES
Providing misleading information Financial penalty not exceeding £5,000 and publication of non-compliance
Renting out a non-compliant property for less than 3 months 10% of rateable value with a minimum penalty of £5,000 and a maximum penalty of £50,000 and publication of non-compliance
Renting out a non-compliant property for more than 3 months 20% of rateable value with a minimum penalty of £10,000 and a maximum penalty of £150,000 and publication of non-compliance

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