Up to 15% of Non-Domestic Properties Currently Achieve Below an E Rating
With the focus very much on improving energy efficiency and reducing the UK’s carbon footprint in the fight against climate change, the importance of buildings achieving specified energy ratings has never been more relevant. MEES was introduced in April last year, making it unlawful for landlords to rent or sell a commercial property with an energy performance certificate (EPC) rating of F or G.
It has been estimated that nearly one sixth of landlords1 could be expected to face fines if their buildings are currently achieving below an E rating. Fines will be up to £50,000 (for non-compliant properties where the breach has been less than three months) or up to £150,000 (for properties that are let for more than three years). Additionally, any landlord or investor who is fined is placed on a public register. Landlords need to act quickly to ensure that buildings comply with MEES regulations, in order to protect future revenue and their reputation.
From 2023, the scope will be extended to cover all existing leases as well as new leases, and this is likely to see a further rise in prosecutions. Although older buildings are most likely to be affected by the regulations, landlords have been encouraged to audit all of their portfolios sooner rather than later, to establish which properties will be affected and carry out energy assessments to ensure each building within their portfolio holds an up-to-date EPC. Big advances towards compliance can be achieved by improving the EPC data that is recorded and monitored in relation to each asset.
The S2 Partnership’s RiskWise risk management software is being used by a number of clients as the ideal solution for storing all relevant EPC data across a portfolio. The data can be analysed on a Unit by Unit level, allowing landlords to plan and track improvement strategies or mitigation plans effectively. A series of dashboard graphs clearly display the proportion of properties in each EPC category, identifying any properties that are rated F or G. Further important information, such as the size of the unit and whether it is occupied or vacant, is also stored.
Once populated with the unit’s EPC data, RiskWise may also be used to record which properties require alterations or improvements, saving valuable time for the landlord. Recording the efficiencies (and inefficiencies) within a property strengthens the landlord’s visibility of risk, helping ensure that the properties within their portfolio remain actively lettable or saleable.
MEES will contribute towards the UK’s ambitious legislative targets to cut CO2 emissions for all buildings by 2050. Therefore, making environmental performance a key part of business strategy is now crucial. The S2 Partnership has a team of qualified environmental consultants on hand to help organisations manage environmental priorities effectively. S2 has held ISO 14001 for its own operations since 2007, and is also proud to be a GRESB Premier Partner, highlighting its commitment to managing ESG data and helping clients to improve ESG performance across the sector.
For further information about RiskWise or to contact one of our environmental consultants, please contact us.
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1 Gov.uk Live Tables on Energy Performance of Building Certificates (Table A : non-domestic Energy Performance Certificates by energy performance asset rating)