Efficiency law in rental properties: the lowdown

There are significant changes to energy legislation afoot in domestic and commercial rental properties as the new Tenant’s Energy Efficiency Improvement and Minimum Energy Efficiency Standards, both of which are part of the Private Rental Sector

Energy Efficiency Regulations 2015, have now come into force.

In the private residential sector, this new energy efficiency legislation gives more rights to tenants and sets a minimum standard of energy efficiency. From 1st April 2016, all domestic tenants have the right to request consent for energy efficiency improvements. This applies to domestic properties let under an assured tenancy and a regulated tenancy. This will be widened to cover an assured agricultural occupancy, protected tenancy and statutory tenancy.

There are some exemptions. If the building is exempt from having an Energy Performance Certificate (EPC) then a landlord is not required to provide consent. A tenant must also show that the measures could be installed with no upfront cost to the Landlord (the removal of Green Deal funding for energy efficiency in September 2015, created a loophole in the legislation). However, residential private landlords will not be able to unreasonably refuse consent to a tenant’s request for energy efficiency improvements if the various criteria are met. Enforcement will be handled by the First-tier Tribunal General Regulatory Chamber, which will hear and determine applications from tenants where the tenant considers that the landlord has not complied with the regulations.

Coupled with this legislation, from 1st April 2018, the Minimum Energy Efficiency Standard for privaterental properties will be set at an E Energy Performance Certificate rating. The regulations will initially only apply upon the granting of a new tenancy to either a new or existing tenant. However, from 1st April 2020, the regulations will apply to all privately rented property within scope, which are those that have an EPC or are required to have an EPC as per existing EPC legislation.