Last month, the government made a U-turn and removed the upcoming EPC (Energy Performance Certificate) requirements for rental properties.
Originally, landlords had to upgrade rental properties to have an EPC rating of C or higher by 2025 for new and 2028 for all existing tenancies. There were fines of up to £30,000 for not compliance.
Now, all of these EPC requirements have been abandoned. The government says it will instead encourage landlords to upgrade their rental properties’ energy efficiency voluntarily.
EPC changes removed
Given the costs involved, many landlords are likely happy to see the EPC rules dropped. However, research by Shawbrook Bank found that 80% were already prepared for the original 2025 EPC deadline. 30% of landlords currently have rental properties with EPC ratings of A-C, and 50% have upgrade plans in place.
The study also found almost half of landlords have invested in improvements to their rental properties over the past year, spending an average of £25,148 per property, or £37,164 for properties in London.
In short, many landlords have already spent significant sums to comply with EPC regulations, but is this money wasted?
Still worth improving EPC ratings?
While mandatory EPC upgrades are scrapped, there are good reasons for landlords to still consider energy efficiency improvements. Upgrades make rental properties more attractive to tenants, as despite recent drops, energy bills are still much higher than in early 2022. Many tenants want cheaper-to-run homes.
Also, a general election is due by January 2025. If Labour wins, Shadow Secretary Ed Miliband wants to bring back the EPC C rating targe as part of his commitment to action on insulation and efficiency.
The smarter way to upgrade rental properties
While meeting the new EPC standards is no longer mandatory, taking a PAS 2035 approach can benefit landlords making energy efficiency upgrades.
PAS 2035 is a standard that provides a framework for whole-building retrofits. It emphasises evaluating the entire building and identifying customised improvements tailored to each property.
This whole-building approach reduces risks compared to single upgrades like insulation only. There are around 26 million existing homes in the UK, over 8 million of which are older solid wall constructions. Insulating these without considering ventilation and other factors could lead to moisture and mould issues.
PAS 2035 avoids this by taking a “fabric-first” approach and specifying adequate ventilation. This is critical for health and safety, especially in older solid wall homes where interior moisture increases after insulation is added.
In short, PAS 2035 takes a customised, whole-building approach to identify the best energy upgrades.
Additional benefits of PAS 2035:
- Reduced risk of unintended consequences from poorly planned upgrades
- Maximised return on investment from packages of complementary improvements
- Ongoing energy savings and performance after upgrades
- Assurance of tenant health and building integrity.
By taking a PAS 2035 approach, landlords can maximise their return on investment in energy efficiency upgrades while protecting asset values and tenant satisfaction.
How VOR Group can help
VOR Group works with landlords to deliver cost-effective, compliant upgrade projects. Simple improvements like insulation, heating controls and LED lighting can lift old properties to the new EPC C rating.
VOR Group can conduct light-touch PAS 2035 assessments to identify the most impactful upgrades tailored to each property. With decades of experience, VOR Group offers end-to-end support, from technical surveys and design to project management.
Contact us to discuss a PAS 2035 assessment that can maximise your property investments and savings.
