The Department for Business, Energy & Industrial Strategy (BEIS) has released guidance on the application of the Minimum Energy Efficiency Standards (MEES) for non-domestic buildings. In this document, they cast doubt on the interpretation favoured by the Department for Communities and Local Government (DCLG) on the requirement for EPCs for listed buildings.
The Alliance has long been arguing that an EPC is required for the majority of listed buildings under the existing Energy Performance of Buildings Regulations. We have seen the DCLG gradually backing away from the stance that "if it is listed it is exempt" but unlike BEIS they have not yet issued clear guidance stating otherwise.
The confusion stems from the paragraph in the regulations stating that EPCs are not required for
"buildings officially protected as part of a designated environment or because of their special architectural or historical merit, in so far as compliance with certain minimum energy performance requirements would unacceptably alter their character or appearance"
Whilst clearly a listed building is officially protected for its architectural or historical merit it is the second part of the sentence that is all important. As BEIS rightly state in their guidance
"Examples of energy performance measures which may alter character or appearance … include external solid wall insulation, replacement glazing, solar panels, or an external wall mounted air source heat pump."
The guidance then goes on to point out that
"Where character or appearance would not be altered by compliance with energy performance requirements, an EPC may be legally required."
Well hooray! The penny has finally dropped. There are literally thousands of energy inefficient listed properties out there where things like loft insulation or upgrading heating and/or hot water systems can make a significant difference; without altering their character. The people living in those properties need them more energy efficient and the country can't afford for those properties not to be upgraded if we are going to meet our targets.
It would clearly be ridiculous to completely exclude a large proportion of our least efficient buildings from the requirement to make them more energy efficient if it is reasonably possible to do so. That is why the regulations only exclude them if it is not reasonably possible to do so; and we are pleased that BEIS has finally recognised this and issued appropriate guidance.
What we now need is similar clarification from the DCLG. In the meantime, assessors should not risk telling clients that if their property is listed they don't need an EPC for sale or rental. That advice could prove to be incorrect, making the assessor liable. The safe approach is to state that
If your building is listed, then it may be exempt from needing an EPC (for sale or rental) however the legislation is not entirely clear on this point and it is for your solicitor and the solicitor for the other party to determine whether they believe one should be produced.
An assessor could add that there is no risk in obtaining an EPC that was not actually needed whereas there is a risk in not obtaining one if it is deemed you should have. Again, BEIS are ahead of the game on this one and their guidance confirms that
"In situations where an owner or occupier of a building which is not legally required to have an EPC has obtained one voluntarily … the landlord will not be required to meet the minimum standard."
At last we are seeing some common sense being applied to what has been one of the most contentious issues for EPCs.
The guidance referred to in this article is
THE NON-DOMESTIC PRIVATE RENTED PROPERTY MINIMUM STANDARD
Guidance for landlords and enforcement authorities on the minimum level of energy efficiency required to let non-domestic property under the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015
The Alliance of Energy Assessor Associations
25 February 2017