A New Standard (MEES)

From 1st April 2018 there are new laws coming into effect.

The Minimum Energy Efficient Standards Legislation will make it unlawful to agree a new lease (as well as lease renewals) for a commercial property which achieves an Energy Performance Certificate (EPC) rating below an E. This will affect all commercial properties and landlords should act quickly to prevent any penalties.

After public consultation between July and September 2014 the Government released the MEES regulations in February 2015. These will apply to commercial and residential properties. The deadline of April 2018 will only apply to lease renewals and new lettings, however from 1st April 2023 MEES will apply to all current leases. The MEES regulations apply in England and Wales. There are separate but complimentary regulations applying in Scotland, which have been developed under Section 63 of the Climate Change (Scotland) Act, known as ‘Action on Carbon and Energy Performance’ (ACEP).

The aims of the MEES regulations are to:

•  Improve the energy efficiency of properties with an EPC rating of ‘F’ or ‘G’

•  Begin to achieve the UK’s legislative targets –all buildings must be Carbon Neutral by 2050

•  Help to tackle the traditional barrier to the implementation of energy efficiency works in buildings (aka the ‘split incentive’) where the landlord foots the bill for improvements that benefit the tenant.

Key points

MEES will require commercial property in England & Wales to be brought up to a minimum Energy Performance Certificate (EPC) rating of ‘E’.

MEES will apply to new lettings and lease renewals from 1 April 2018.

MEES does not apply to very short lettings, or to lettings of 99 years or more.

Landlords will be exempt after all cost-effective improvements have been carried out.

Compliance must not devalue the property.

The minimum standards are likely to increase.

It is expected that the government will review the standards and likely raise them to cover all properties with a rating below a ‘D’ in 2025. After which, in 2030, the minimum efficiency could be a ‘C’ rating.