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New Minimum Energy Efficiency Standards Requirements Impact on Commercial Landlords

With new Minimum Energy Efficiency Standards (MEES) for commercial landlords introduced last month, there is a growing number of landlords that have yet to put a sustainability plan in place. While that comes with several pitfalls, one of the most significant is the risk of being unable to let out property due to an insufficient standard of Energy Performance Certificate (EPC). 

From April 2023, offices and other commercial buildings that do not meet an EPC rating of Band E or above are ineligible to be rented out. These minimum standards are set to become steadily more stringent; the minimum standard will jump to EPC Band C in 2027 and increase to Band B three years later. 

75% of office buildings in the UK will be subject to the new regulations. Currently, it is estimated that 56 million square metres of office space will fail to meet the current minimum standard, with regions outside of the southeast most significantly impacted. In areas including Northampton, Leicester, Bradford and Hull, more than 20% of office space would fail to meet current standards. 

The fact that many commercial buildings will fail to meet minimum EPC standards is symptomatic of a wider issue for landlords; the lack of a sustainability strategy. Businesses across all sectors have been warned for years now that legislation will arrive that forces their hand, and to fail to take sufficient measures to improve their sustainability performance could see them falling foul of future green legislation. That point has now arrived for many commercial landlords, who could face fines of up to £150,000 for leasing property that doesn’t meet minimum standards. 

With the built environment in the UK also accounting for a quarter of all greenhouse gas emissions, many landlords now face a potentially expensive upgrade or retrofit scheme to bring buildings up to minimum standards. There is a variety of ways to improve the energy efficiency of a building, from improving insulation and HVAC systems to the installation of energy efficiency technologies such as voltage optimisation. ISO 50001 certification can provide a framework for implementing a more efficient energy management system across a business, including commercial stock.