Energising Times – The Government Has Launched Consultations On EPCs And MEES For Domestic Properties

The Government has picked up the gauntlet in relation to meeting our net zero targets. In December 2024 it launched a consultation on the future of Energy Performance Certificates (EPCs) and in February 2025 it launched a consultation on the future of Minimum Energy Efficiency Standards (MEES) for domestic properties.

Background

To encourage people to make buildings more energy efficient there has been a requirement since 2008 to provide an EPC whenever a property in the social, private rented sector or commercial sector is sold or let to a new tenant.

If an EPC is not already held for a property, a seller or landlord must commission one before marketing the property. Any advertisement offering the property for sale or rent must state the energy performance indicator for the property. The rating will be a letter between A and G; A being the most energy efficient rating and G the least. What rating you require your building to be will depend on many factors. The most important of these if you intend to let a property will be its MEES status. The MEES framework is mandated by the Government to ensure that commercial and residential buildings which are let meet specific energy standards and it is now unlawful to let, or to continue to let property with an EPC rating below E unless an exemption has been registered.

What changes does the Government want to make?

The Government is seeking to set higher MEES requirements for residential lettings using new metrics planned to be introduced for EPCs following EPC reform in 2026. The planned new EPC metrics would assess the energy performance of buildings based on fabric performance, smart readiness, and the efficiency and emissions of the heating system.

EPC reform

The consultation states that the vision for the reformed EPC framework is to provide a system which:

• Provides homeowners and tenants with accurate information about the energy performance of their homes to allow them to make informed investment and purchase decisions
• Provides accurate information to determine eligibility for schemes and measure progress against government targets
• Provides an information tool to support a range of actions including reducing carbon emissions, tackling fuel poverty, improving decency and the Warm Homes Plan
• Reflects the needs of wider users of EPCs beyond homeowners and tenants, such as suppliers of energy efficiency products and services, as well as lenders.

Further detail on the proposals for the steps needed to achieve this vision can be found in the EPC consultation here. Highlights include:

• Multiple metrics: Moving away from the current system of providing a headline EPC metric (i.e. the A to G banded energy efficiency rating) towards using multiple metrics on EPCs to provide a more complete representation of a building’s energy performance
• Validity periods: Reducing the validity period of EPCs from the current 10 year period – possibly to as little as 2 years
• New trigger points: Introducing a new EPC trigger point for obtaining an EPC in respect of private rental properties where the current EPC expires
• Restrictions on marketing: Preventing buildings from being marketed for sale or for letting without an EPC. The 28 day grace period which currently applies when an EPC has been commissioned but not yet received will be removed
• HMOs: Requiring an EPC for an entire house in multiple occupation when a single room within it is rented out
• Listed buildings: Requiring that all heritage buildings (i.e. buildings, such as listed buildings, officially protected as part of a designated environment or because of their special architectural or historical merit) have an EPC.

MEES reform for domestic buildings

Following EPC reform, the Government is then proposing to tighten MEES requirements for privately rented homes in England and Wales to the equivalent of EPC rating C. Proposing that ‘new tenancies’ meet the higher standard from 2028 and ‘all tenancies’ meet the higher standard by 2030. The previous Government under Rishi Sunak scrapped plans to raise MEES in relation to privately rented homes. However, they are now clearly back on the Government’s agenda.

The full consultation can be seen here. Key points include:

• Metrics: The Government suggests setting future MEES requirements against the new EPC metrics proposed in the EPC consultation. With its preferred approach of being a primary standard set against the fabric performance metric and then a secondary standard set against either the smart readiness metric or heating system metric, with landlord discretion on which secondary metric their property meets
• Cost cap: Earlier consultations have considered minimum spend requirements. This consultation follows suit with a proposal that landlords would need to spend at least £15,000 on energy improvements for a unit which still does not meet the minimum EPC rating in order to be able to register an exemption. The Government wants feedback on whether that cap is the right level. The Government state that help is available to landlords through the Boiler Upgrade Scheme and Warm Homes: Local Grant which begins delivery this year
• Exemption period: The exemption period (currently set at five years) should be extended to ten years if the cost cap is increased to £15,000
• Exemptions: The consultation asks if an affordability exemption should be created with a lower cost cap of £10,000 which could be applied on the basis of lower rents or council tax banding. The consultation also proposes to simplify the temporary exemption available to new landlords to include any person who becomes the landlord of a property which, on the date of purchase or transfer of ownership, is let on an existing tenancy
• Short term lettings and listed buildings: Should short-term lets and listed buildings be brought into the MEES regime
• Transitional period: It is suggested that properties that have an EPC rating of C on EPCs obtained before the EPC changes in late 2026, these old style EPCs should be recognised as compliant with the future standard until their current EPC expires or is replaced. The. Government is exploring options for how landlords can continue to demonstrate compliance with the EPC E standard under the existing MEES requirements in the period between new EPCs being introduced and proposals reform MEES coming into effect.

MEES reform for commercial buildings?

A consultation for the tightening of MEES requirements for non-domestic buildings has not yet been issued. However, we believe that it is still the Government’s intention to tighten MEES requirements for non-domestic properties as well. The Government indicated in its response to the Climate Change Committee’s July 2024 report that it intends to respond to the outstanding 2021 Consultation on tightening MEES regulations for non-domestic properties in early 2025.  You might recall that the 2021 Consultation proposed introducing minimum EPC ratings for non-domestic properties of C by 1 April 2027 and B by 1 April 2030.

Final thoughts

Landlords both commercial and residential should engage with the EPC consultation and residential landlords should also engage with the domestic MEES consultation. It is clear the Government will be pushing this agenda with residential property their first priority. This year could be the year we finally get some clarity in this area. However, until we do it is advisable for landlords and those purchasing investment property to think carefully about the costs that could be associated with bringing properties up to the required MEES standards and how these consultations could impact their business plans.

If you have any questions on EPCs and MEES requirements, or any other Real Estate issue, please do not hesitate to contact us at Thomson Snell & Passmore.