Since the 1st October 2008 all Commercial Properties being built, bought, sold or let have required an Energy Performance Certificate (EPC) by Law. The certificate grades the energy efficiency of the property by giving it a rating between A to G and offering recommendations as to how the rating may be improved.
Policy makers originally hoped that the certificates would encourage landlords and tenants to improve the energy efficiency of their premises. However in the two and a half years since their launch they have had very little impact on influencing tenant’s decisions in selecting new premises or convincing landlords to install energy efficient systems when refurbishing properties.
Policy makers originally hoped that the certificates would encourage landlords and tenants to improve the energy efficiency of their premises. However in the two and a half years since their launch they have had very little impact on influencing tenant’s decisions in selecting new premises or convincing landlords to install energy efficient systems when refurbishing properties.
A number of factors have contributed to the failure of commercial property EPC’s with the main one being the fact that residential property EPC’s have been required before a property could be marketed with the residential agents being liable if they are were not made available.
For commercial properties agents were only liable to remind their clients of the obligation to produce an EPC before the sale or letting completed which often meant tenants never had the chance to review the EPC rating and recommendations before they had already formally committed to take a premises.
The Coalition Government has acknowledged these failings and has proposed a number of changes which will try to ensure that the original benefits of an EPC will be more widely recognised by all parties involved. Firstly it has been suggested that from July 2011, commercial property agents will be held jointly liable to ensure EPC’s are made available when properties are first marketed and from 1st October 2011, EPC’s will have to be displayed on all commercial property marketing particulars.
Geoff Springthorpe, Head of Property Management, Holloway Iliffe & Mitchell said: “Energy costs have increased year on year since EPC’s were introduced and this should encourage occupiers to take an interest in their energy costs. A possible future link between business rates and EPC ratings would also focus minds with this type of tax having already been in use since April 2002, linking company car taxes to their CO2 emissions.”
Secondly, the government plans that all commercial premises will require a Display Energy Certificate (DEC) from October 2012 as part of their 2050 Low Carbon Roadmap which will make it much easier to establish the actual energy cost of running a specific property.
DEC’s are already compulsory for all Public Buildings larger than 1,000 sq.m and show the actual energy consumption of the property accompanied by an A to G rating and must be displayed within the property. A DEC requires an annual update. In addition the DEC includes an advisory report which is valid for seven years.
