EDITOR’S OPINION: Raising the energy efficiency bar
1 October 2024
Following through on its manifesto pledge to improve the energy efficiency of rented properties, the Labour government has confirmed that all rented homes in England and Wales will be required to achieve an EPC rating of at least C by 2030. The new requirement is part of the government’s Warm Homes Plan, and reverses a decision by the previous administration to scrap any such commitment.
While giving landlords plenty of time to instigate the necessary upgrades, there is no doubt that many will be faced with significant costs, and there are fears that such an outlay will ultimately be passed on to tenants in the form of rent increases. There are also concerns about the long-term impact on the private rental sector. With many already facing rising maintenance costs, inflation and other regulatory burdens, it is thought that the new EPC requirements could push some landlords to exit the market, reducing the availability of rental properties at a time when supply is already struggling to meet demand.
But should such fears mean that the government should shy away from enforcing much needed improvements to the standard of the country’s housing stock? It may prove to be problematic to introduce legislation that prevents landlords from passing on costs to renters, but at least tenants should stand to benefit from residing in a property with a decent level of energy efficiency.
According to Energy Secretary Ed Miliband, part of the policy’s objective is to lift around a million rented homes out of fuel poverty and ensure tenants are not facing “crippling energy bills” in poorly insulated accommodation. The latest research suggests that a tenant living in an average property with an EPC C rating would pay £499 less a year in utility bills, compared to a tenant living in an average property with an EPC D rating. The difference is even bigger between typical properties with EPC C and EPC E ratings, with an estimated annual saving of £1,248.
As well as energy savings, there are also clear benefits to the nation’s health, as less people will be forced to live in accommodation which can sometimes fall way below acceptable standards of habitation. And a healthier population should also ultimately save on future NHS budgets.
The Energy Performance Certificate, first introduced 17 years ago, might not currently represent the perfect system for appraising a property’s energy efficiency credentials, but it is a methodology that can be improved and adjusted over time to reflect changes to technology and different priorities. In the meantime, with a significant proportion of the rented sector built before the last war and in clear need of an energy efficiency upgrade, anything that will oblige landlords to make the necessary investments has to be welcomed.
• Chris Jones, managing editor
