Energy Performance Certificates (EPCs) are quickly becoming established as part of every day life for landlords, letting agents, property owners, property agents, business agents, solicitors and others.However, there is still a great deal of misunderstanding about why & when EPCs should be commissioned, the benefits/pitfalls and what is the right price to pay.
In 2007 the UK government implemented EU Directive 2002/91/EC and launched the Energy Performance of Buildings Regulations. The regulations are designed to reduce CO2 emissions of buildings. An EPC shows the asset rating of the building as an A to G energy rating, with G being the least energy efficient. The Energy Performance Certificate is accompanied by a Recommendation Report, either as a separate document accompanying Non-Domestic Energy Performance Certificates or as an integral part of the Domestic EPC document, setting out basic ways in which the building’s energy efficiency could be improved. For more specific, targeted energy efficiency improvement recommendations for your business, a full Energy Audit should be commissioned.
Different regulations cover England & Wales, Scotland and Northern Ireland but impose broadly similar requirements, with some differences including implementation dates. The regulations allow for a range of sanctions to be imposed, including fines of up to 5,000 pounds for each breach.
There are several different types of EPC, including those required on construction for new residential builds. The two most common types of EPCs needed are Domestic EPCs relating – as the name suggests – to purely residential properties and Non-Domestic EPCs relating to Commercial premises. Non-Domestic EPCs are more commonly known as Commercial Energy Performance Certificates.
If a commercial premises – or a home in the social or private rented sector – is to be sold, or let to a new tenant, then an EPC must be supplied free of charge to the prospective buyer or tenant by the landlord when the buyer or tenant is given written- including electronic- information about the property or when the prospective buyer or tenant views the property, whichever occurs first and before any contract is entered into.
For residential sales, the EPC usually forms part of the Home Information Pack in England & Wales and part of the Home Report in Scotland. Note that Energy Performance Certificates are valid for 10 years and can be re-used as many times as needed within that period so long as no major alterations have taken place, i.e. it is not necessary to commission a newer Energy Performance Certificate every time there is a change of tenant.
Discerning buyers and tenants may lose interest in a property if the EPC reveals a poor energy rating, or they may wish to negotiate a lower purchase price or rent if they face costs in improving energy efficiency or for higher energy bills. Larger corporations that will be drawn into the Carbon Reduction Commitment will, of necessity, need to be extremely choosy about the energy efficiency of commercial buildings they buy, rent or renew a lease for, since they face potentially huge bills for every tonne of CO2 emissions resulting from the use of energy in their buildings.
The same legislation has also introduced the need for organisations with operational control of air conditioning plant with a cumulative effective rated output exceeding 12kW to have anAir Conditioning Assessment carried out by an accredited assessor.
Furthermore, buildings with a total useful floor area over 1,000 square metres that are occupied in whole or part by public authorities and by institutions providing public services to a large number of persons and therefore frequently visited by those persons, must display a Display Energy Certificate (or in Scotland, an Energy Performance Certificate). The DEC must be displayed in an area clearly visible to the public.
The cost of obtaining Commercial Energy Performance Certificates, Air Conditioning Assessments and Display Energy Certificates has fallen over the past 12 months and discounts for multiple orders can often be negotiated. As with any product or service, it really does pay to compare prices.