Energy Performance Certificates - EPCs
More changes to the housing market and commercial property market
Statistics indicate that 40% of the UK’s carbon emissions are from buildings, nearly double that of cars and planes. The way a building is constructed, insulated, heated, ventilated and the type of fuel used, all contribute to its carbon emissions. As a result, Energy Performance Certificates (EPC) were introduced to improve the energy efficiency of buildings. The certificate provides 'A' to 'G' ratings for the building, with 'A' being the most energy efficient and 'G' being the least, with the average up to now being 'D'. Accredited energy assessors produce EPCs alongside an associated report which suggests improvements to make a building more energy efficient.
EPCs affect all sectors of the property market – residential, commercial, letting (both private and social).
There has been a requirement since 1 June 2007 for an EPC to be provided as part of the Home Information Pack when a house or flat is sold.
EPCs have also been required since 6 April 2008on the construction, sale or renting out of large commercial properties.
However, 1 October 2008 heralds the full implementation of the legislation with a requirement that an EPC is provided on the construction, sale and rent of ALL buildings – commercial and residential. Therefore, subject to minor exceptions, all commercial buildings are now caught irrespective of size and buy to let landlords and other landlords in both the private and social rented sectors are affected.
An EPC must be available to prospective buyers and tenants at the earliest opportunity, and in any event before a contract is entered into to sell or rent out the building. There are some exceptions (for example churches and temporary buildings) and there are transitional arrangements in place to assist landlords or sellers of commercial properties who were already in the process of selling or letting but are now caught by this requirement, and who may find it takes time to obtain an EPC for their building BUT these transitional arrangements only apply until 4 January 2009.
How FDR can help?
If you are selling your house your solicitor or estate agent will advise you on the Home Information Pack, and this will include an EPC. Landlords of residential property should obtain legal advice as to whether they need to provide an EPC when they let the property, as there are exemptions for particular types of lettings e.g. where the tenant will not have fully self-contained accommodation. We can also assist landlords of multiple properties in identifying how they might save time and cost, possibly by the production of a single EPC.
Sellers and landlords of commercial property are likely to be using the services of a commercial Agent, who should alert them to these requirements. However, many commercial developers and landlords will want legal advice on the detailed provisions of the 2007 Regulations, and how it affects them and their business.
FDR’s Commercial Department has considerable expertise in this area. We act for government agencies and other public sector clients who have been at the forefront of the drive for more sustainable buildings and energy efficiency. Our lawyers have been working with them to incorporate these and other innovative design and quality standards in new commercial and residential developments. We therefore have the legal knowledge and commercial “know-how” to advise individuals and companies on EPCs and the host of new energy and design standards that are now a feature of new construction projects.