Hurriedly introduced but hugely significant changes to the Energy Performance of Buildings regime took effect this month, writes Bill Chandler, which will require many occupiers to obtain additional energy certificates or to display those already obtained.
For the first time, many private sector businesses are now required to display an Energy Performance Certificate on their commercial premises. The Display Energy Certificate regime for public sector buildings is also extended, whilst important changes are made to the EPC requirements when marketing a property.
The Energy Performance of Buildings (England and Wales) Regulations 2012 consolidate several existing Regulations which have been implemented since 2007 to give effect to an EU Directive aimed at reducing the substantial carbon emissions emanating from buildings. The buildings in which we live and work account for nearly half of all carbon emissions, so improving the energy efficiency of buildings is key to achieving EU and UK climate change targets.
Significantly, the new Regulations also introduce some important changes to reflect amendments made to the EU Directive on which they are based. However, despite knowing for some considerable time that these changes had to be implemented, the Government laid the new Regulations before Parliament on 19 December 2012, to take effect on 9 January 2013. This did not give those affected much time to digest and give effect to the new requirements.
The most significant changes from 9 January 2013 were as follows:
Where an EPC exists for a commercial building larger than 500 sq m which is frequently visited by the public, the certificate must now be displayed in a prominent position clearly visible to members of the public who visit the building. This will particularly affect the retail and leisure sectors, although the accompanying Government guidance also refers to office blocks and factories as potentially being caught. Whilst unclear from the Regulations themselves, the guidance clarifies that the duty is on the occupier, ie the tenant rather than the owner where the premises have been rented out. This is the first time that private sector organisations have been required to display an energy certificate, but at least the Government has stopped short of its original proposal to simply extend the full DEC regime to commercial buildings;
The threshold above which public sector buildings frequently visited by the public must display a DEC has been halved from 1,000 sq m to 500 sq m, although for buildings between 500 sq m and 1,000 sq m the certificate only needs to be renewed every 10 years rather than annually. The threshold will be halved again to 250 sq m on 9 July 2015;
When marketing a property (whether residential or commercial), it is no longer necessary to attach a copy of the full front page of the EPC to written particulars, but all written material (and all advertisements in the commercial media) must include the EPC asset rating where available and the guidance recommends that the full graph is included if space permits.
A new exemption from the obligation to provide an EPC has also been created for "buildings and monuments officially protected as part of a designated environment or because of their special architectural or historical merit, in so far as compliance with certain minimum energy performance requirements would unacceptably alter their character or appearance", although the full extent of this exemption is not entirely clear from either the Regulations or the guidance.
Beware that the new Regulations contain no grace period, so if you are a business who needs to display an existing EPC, or a public sector body who needs to obtain additional DECs, you need to take action now.
- Bill Chandler is legal director at Hill Dickinson