New minimum energy standards are on the way for 2031 where rented and leased buildings over 1,000 square metres will need to achieve a higher energy efficiency rating of EPC band B, where it is deemed cost-effective.
What are the benefits?
Put simply, building owners are unlikely to secure finance or be able to let to a tenant where the energy efficiency at large buildings is poor. And tenants in turn will be occupying buildings that have the potential to be operated in an efficient, driving down costs.
What does this mean for ISO 50001 and ISO 14001?
Minimum Energy Efficiency Standards (MEES) are part of a management system’s compliance obligations. They require internally auditing and evaluation of compliance.
What has changed?
The government’s recent proposals are aimed at enhancing energy efficiency standards for non-domestic buildings in England and Wales. This interim response follows consultations from 2019 and 2021, and it outlines a targeted approach that focuses on helping businesses, particularly those renting larger premises, cut energy costs and improve energy efficiency.
Key Proposals:
Higher Energy Efficiency Standards:
• Starting in 2031, all private rented buildings over 1,000 square metres will need to achieve a higher energy efficiency rating of EPC B, where it is deemed cost-effective.
• Buildings below 1,000 square metres will continue to adhere to the current minimum standard of EPC band E.
Changes to Milestones:
- The previously proposed interim milestone of EPC band C for 2027 will not be implemented. This gives landlords and tenants more time to improve the efficiency of their buildings in accordance with their specific circumstances and lease agreements.
Flexibility Mechanisms:
- Existing flexibility mechanisms, including the 7-year payback test and exemptions, will remain in place. This ensures that only improvements that are practical, affordable, and cost-effective will be mandated.
Legislative Process:
- The changes to raise the Minimum Energy Efficiency Standards (MEES) to EPC B for larger buildings will take effect only after successful secondary legislation is passed through Parliament.
Benefits of the New Approach:
This targeted initiative is designed to deliver significant benefits, including:
- Cost Savings: Tenants in larger rented buildings are expected to save up to £360 million in energy bills annually by 2031, protecting them from potential energy price shocks.
- Reduced Energy Demand: The proposal aims to decrease the energy demand from rented non-domestic buildings, which will, in turn, strengthen energy security and reduce carbon emissions.
- Support for Smaller Properties: For SMEs and high street landlords with smaller properties, there will be additional flexibility to upgrade buildings over time, with no strict deadlines for surpassing the EPC band E standard.
How can we help?
We stay ahead of the game for our clients and help integrate energy and environmental regulations into day to day operations, avoiding the pitfalls and maximising the benefits.
Should you have any questions or require further clarification on how these updates might impact your business, please feel free to reach out to us. We’re here to support you in navigating these changes effectively.
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