From 01 April 2018, Landlords have not been able to grant new tenancies if their property has an energyF efficiency rating of less than E due to the MEES unless they were able to satisfy one of the exemptions. Now, as of 01 April 2020, existing tenancies are also included in these standards. This is all part of the Government’s Green Growth Strategy to, by 2030, upgrade all residential properties to at least a C rating in energy efficiency where possible and cost effective.

Therefore, as of 01 April 2020, Landlords have yet another piece of legislation to consider, but it is important that these standards are not ignored. This scheme applies to all assured tenancies (which includes assured shorthold tenancies) and regulated tenancies, but not to social Landlords.

The obligation placed on Landlords is to carry out enough of the works as listed in the EPCs recommendation report to bring the efficiency rating up to at least an E. However, for residential properties, Landlords are only required to pay a maximum of £3,500 to try and improve the energy efficiency rating. Should this not be possible, then there are some exemptions open to Landlords.

Exemptions

If the Landlord spends £3,500 and the energy efficiency rating cannot be improved to at least an E, then the Landlord is entitled to register for an exemption. There is no obligation for Landlords to spend more than this amount to improve the energy efficiency of the property. Similarly, if there are no energy efficiency improvement works that can be carried out that will cost less than £3,500, then the Landlord will be exempt even if the energy efficiency rating is less than E.

In addition to the above, should a Landlord require some sort of consent to carry out the works, such as planning consent, and this is not able to be obtained then the Landlord is also exempt from this obligation.

These exemptions will last for 5 years and can be renewed where and when required. There is no cost to a Landlord for registering for an exemption, but this could be a time consuming exercise in terms of obtaining the information required to support any application for an exemption. 

Penalties

It is important that Landlords do not ignore this scheme and the requirements that it places on them. Any residential property that is let out by Landlords, with an energy efficiency rating of below E, will be considered sub-standard.

Should a Landlord not comply with this scheme and not do what they can to improve the energy efficiency rating, then they can face a fine of up to £5,000 for each property which is below standard. The general position, at the current time, appears to be that local authorities are not strictly enforcing these rules or punishing Landlords who have not complied with them. However, it would be wise to expect this position to change and enforcement of these requirements to become common place sooner rather than later. Therefore, it would be prudent for Landlords to ensure that they do what they can to improve the energy efficiency rating as required if they have not done so already.

Conclusion

Landlords need to ensure that they have at least attempted to improve the energy efficiency of their property, and are able to show the steps taken in that regard, or they expose themselves to a potential fine from the relevant local authority.  These improvements need not break the bank, but a reasonable effort needs to made by Landlords.

Furthermore, it would be wise to try and improve the energy efficiency standard of their properties in any event, as, in the future, it is likely that further and higher standards and obligations will be imposed on Landlords.  

Should you have any questions in relation to the above, then please do not hesitate to contact Jack Morgan on Jack@kdllaw.com or 01435 897 297.

Disclaimer

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