Amending the Private Rented Sector Energy Efficiency Regulations
The Minimum Energy Efficiency Standard Regulations, which take effect from April 2018, require private landlords in England and Wales to ensure their properties meet a minimum energy efficiency standard of Energy Performance Certificate (EPC) Band E, or get as close to it as is possible using available third party funding.
Objectives of the consultation
This consultation set out Government proposals to amend the Energy Efficiency Regulations to introduce a potential need for some contribution from landlords of F and G rated domestic properties when meeting the domestic minimum level of energy efficiency.
The proposed amendments would strengthen the domestic minimum standard regulations by removing the existing ‘no cost to the landlord’ principle and introducing a ‘landlord funding contribution’ component where a landlord is unable to obtain suitable ‘no cost’ funding. To protect landlords from excessive costs, Government intends to introduce a cost cap: a limit on the amount any landlord would need to invest in an individual property. A cost cap of £2,500 per property was proposed.
This consultation closed on 13 March 2018.
To download documents that supported this consultation, please follow the links below.
CIBSE very much supports the principle that a landlord contribution should be expected where funding is unavailable to ensure that improvements to Band F and G properties can be delivered.
However, CIBSE thinks that the proposed cap of £2,500 is too low and inappropriately set. By the government’s own estimate, it would result in only 30% of the F- and G-rated PRS properties achieving EPC E ratings. This very low proportion would be a significant missed opportunity and makes it difficult to reconcile with the government’s stated ambitions, including the Fuel Poverty strategy, the Clean Growth Strategy, and the ambitions stated in this very consultation to ensure that “privately rented homes are of good quality, meeting modern standards of comfort and with affordable energy bills for tenants”. CIBSE also highlighted that the Committee on Climate Change strongly recommended recently more measures to tackle the existing building stock. It is also not clear to CIBSE whether the adoption of this cap would have a further negative impact on the ability of the UK to meet its carbon budgets targets.
CIBSE believes that it is extremely important that policy direction is clearly set, and showed to be consistent, in order to allow confidence for investment and developing market capacity. The need to address the “no cost to landlord” clause has been apparent since 2015, and this consultation has been published very close to the regulations implementation date. With the proposed cap so low that the majority of F- and G-rated properties are expected to be exempt, beyond the missed opportunities on these properties themselves there is also a strong risk that government will give the impression of a weak commitment to tackling fuel poverty, health inequalities, carbon reductions and energy efficiency of the existing building stock, including The Clean Growth Strategy’s ambition that “as many private rented homes as possible are upgraded to EPC Band C by 2030”. Achieving this will require a greater level of ambition and investment than this cap intimates.
To read the full CIBSE response please follow the link below.