Energy efficiency in commercial buildings

Energy performance of commercial buildings is a key element in the government’s drive both to reduce the UK’s emissions in the push towards net zero emissions by 2050 and to tackle inefficient energy use. Faced with statistics highlighting the disproportionate contribution of non-domestic buildings to emissions the government has for some time been introducing more onerous regulations. The drive to improve standards is also a reflection of a genuine desire of many landlords and owners to achieve more rigorous sustainability credentials in their own portfolios and for tenants and buyers to demand this as ESG concerns rise up the real estate agenda.

When the “MEES Regulations” were introduced by the Energy Act 2011 requiring that energy performance certificates (EPCs) must be obtained when a building is being sold or let, 2023 seemed a long way off. Since April 2018, non-domestic buildings that are let have been required to have an EPC rating of E or above. From 1 April 2023 landlords must not continue to let a commercial property until an E rating has been reached. Under 2019 consultation proposals the intention is for all rented non-domestic buildings to have reached an EPC B rating by 2030 (barring lawful exemptions) and this trajectory was confirmed by an Energy White Paper in 2020.

Owners and landlords also need to be thinking about future proposals by the government to introduce a performance based rating scheme for large commercial and industrial buildings. The intention is to introduce an annual rating combined with mandatory disclosure in the first instance to tackle actual energy consumption and associated carbon emissions.

We have produced a guide which answers some of the questions that landlords may have about energy efficiency in their buildings and how that may impact letting strategies. If you are interested in receiving a copy, please contact us.

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