Energy efficiency improvement costs for landlords with sub-standard properties will be capped under regulatory changes planned for 2019. Costs will be capped at £3,500 where third-party funding is unavailable or insufficient to cover improvements on a property with an energy rating below E – known as sub-standard.
The existing minimum energy efficiency standard (MEES) restricts grants and continuation of tenancies on sub-standard properties to encourage landlords to improve them. The change means that residential landlords would have to spend up to £3,500, including VAT, in improving energy ratings above F.
The changes follow a consultation on the 2015 energy efficiency regulations. The consultation initially proposed a cap of £2,500. Landlords who want to let sub-standard domestic premises covered by MEES can also claim an exemption from the standard – if they have made all possible efficiency improvements and still cannot meet the standard.
Relevant energy efficiency improvements are those that could be wholly funded ‘at no cost to the landlord’ by central government, a local authority, or any other person – usually under a Green Deal scheme.
For more information please contact our residential team.