New Energy Efficiency Regulations for Commercial Landlords

New Energy Efficiency Regulations for Commercial Landlords

Under new regulations for commercial landlords, properties that require an Energy Performance Certificate (EPC) must obtain a minimum efficiency rating of an E before they can be let.

An EPC provides information on how energy efficient a building is by giving it a rating of A (very efficient) to G (inefficient). This rating system helps tenants to ascertain how much it will cost to heat and light the building, as well as an indication of the level of carbon emissions. The certificate also suggests ways that a more efficient rating could be achieved.

The minimum energy efficiency standards (MEES) come into force in April 2018, from which time landlords cannot grant a new tenancy agreement or renew an agreement if a commercial rented property has an EPC rating of F or G. From April 2023, landlords must not continue to let a commercial property under an existing agreement if it does not meet the minimum energy efficiency criteria. BEIS has issued full guidance on the requirements and possible exemptions under the legislation.

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non-commodity

Rising Non-commodity Highlight the Importance of Energy Efficiency

In the Chancellor’s budget this month, it was announced that the CRC Energy Efficiency Scheme (CRC) will be abolished from 2019 and in order to recoup the Treasury’s lost revenue, the Climate Change Levy (CCL) would rise from April 2019. The Treasury sees CCL as a single tax to incentivise energy efficiency in business.

In addition, the difference in CCL rates between electricity and gas is currently at an electricity to gas ratio of 2.9:1 and this will be adjusted to reflect the fuel mix used in electricity generation, adjusting the electricity to gas ratio to 2.5:1.

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