The majority of commercial buildings will need an Energy Performance Certificate (EPC) to show how energy efficient the property is. Here’s all you need to know about how they work.
What is a Commercial Energy Performance Certificate?
A Commercial EPC measures the energy efficiency of a building on a rating system of A to G, with A being the most efficient and G being the least. EPCs were introduced in England and Wales in 2007 and in Scotland and Northern Ireland in 2008 (EPCs also exist for residential properties).
You must have a commercial EPC if:
- you, as the landlord, rent out or sell the premises
- a building under construction is completed
- there are changes to the number of parts within the building used for separate occupation, involving changes or additions to the heating, air and ventilation systems.
EPCs show those intending to use the building how expensive it will be to heat and light, as well as what its carbon dioxide emissions are likely to be.
An EPC will also state what the rating could be if you made recommended improvements to the property – this may even be as simple as switching to more energy-efficient light bulbs.
How do I get a commercial EPC?
You can only get an EPC from a commercial energy assessor. The type of assessor required will depend on the complexity and features of the building.
A simple building is one with ‘frequently occurring characteristics’ such as simple heating systems, natural ventilation and small cooling systems. Often these are similar to domestic homes and could, for example, be a block of shops with flats above.
A complex building, on the other hand, has advanced features not often found in domestic properties, such as large-scale heating, ventilation and air conditioning systems, and will require a more experienced assessor.
To find your local commercial energy assessor, complete the form on the Non-Domestic EPC Register.
What happens during the assessor’s visit?
During an assessor’s visit, they will consider a number of factors in the building, such as:
- energy efficiency of lighting
- building size area
- cavity wall and loft insulation
- energy efficiency of windows
- ventilation
- heating system and controls.
What EPC rating do I need?
New regulations introduced in April 2018 mean that, if you want to lease a commercial property to a new tenant or renew a lease with an existing tenant, the property must have an EPC rating of ‘E’ or above.
If the property has a rating of ‘F’ or ‘G’, you will not be able to lease it and will need to look into ways to improve its energy efficiency.
From April 2023, these rules will apply to every lease, including existing ones. In addition, as part of the government’s commitment to achieve an 80% reduction in CO2 emissions by 2050, rental properties are likely to need to have a ‘D’ rating or above by 2025, and a ‘C’ rating or above by 2030.
How much does a commercial EPC cost?
The cost of an EPC will vary depending on the building being assessed. However, you can expect to pay somewhere between £100 and £200, plus VAT.
How long does a commercial EPC last?
Commercial EPCs, just like domestic EPCs, are valid for 10 years.
Do all buildings need an EPC?
You won’t need an EPC if you can demonstrate the building is any of the following:
- listed or officially protected and the minimum energy performance requirements would unacceptably alter it
- a temporary building that will only be used for two years
- used as a place of worship or for other religious activities
- an industrial site, workshop or non-residential agricultural building that doesn’t use much energy
- a detached building with a total floor space of less than 50 square metres
- due to be demolished, providing all the relevant planning and conservation consents are in place.
A building is also exempt if all of the following apply:
- it’s due to be sold or rented out with vacant possession
- it is suitable for demolition and the site could be redeveloped
- the buyer or tenant has applied for planning permission to demolish it.
Do I need to display my EPC?
You must display the EPC by fixing it to your commercial building if all of the following apply:
- the total useful floor area is over 500 square metres
- the building is frequently visited by the public
- an EPC has already been produced for the building’s sale, rental or construction.
You can be fined between £500 and £5,000 based on the rateable value of the building if you do not make an EPC available to any prospective buyer or tenant.
Can I appeal a penalty charge?
If you believe you have been unfairly penalised for not having an EPC, you have the option to appeal and ask for a review. You should find details on how to go about this on your penalty charge notice.
If your review is unsuccessful, you will receive a letter confirming the penalty. You then have the option to appeal to the county court (or sheriff court in Scotland) but you will need to do this within 28 days of receiving your confirmed penalty.
