Energy Performance Certificates
European Legislation in effect from the 1st October 2008 requires all sellers and landlords to provide an Energy Performance Certificate (EPC) for all buildings, or indeed parts of buildings (including commercial buildings, such as offices, shops, etc) when they are constructed, sold or rented.
Here at Ernest Wilson, we have a fully qualified and Accredited Energy Assessor on our team of staff which means we are able to offer the full service for provision of Energy Performance Certificates.
If you have any questions, do not hesitate to call Michael Peel or Julie Walton on 0113 238 2900 or e-mail Michael.email@example.com or firstname.lastname@example.org
Energy Performance Certificates
An EPC is required for the sale or let of all* properties from 1st October 2008.
Providing information to prospective buyers and Tenants.
A valid EPC and recommendation report must be made available free of charge by the seller or landlord to a prospective buyer or tenant when non-dwellings are sold or let. This must be at the earliest opportunity and no later than:
- 28 days after the property has been marketed for sale*
- when any written information about the building is provided in response to a request for information received from the prospective buyer or tenant
- when a viewing is conducted
*Any property placed on to the market on or after 6th April 2012 must have an EPC within seven days of being put on to the market, but certainly no later than 28 days of being put on to the market. If an EPC is not provided within 28 days of a property being put on to the market, then the property must cease to be marketed until such time as an EPC is available.
Responsibilities for providing EPCs when selling or letting a non-dwelling.
As soon as a building is in the process of being offered for sale, it is the responsibility of the seller to make available an EPC to prospective buyers free of charge.
As soon as a building is in the process of being offered to let, it is the responsibility of the prospective landlord to make available an EPC to prospective tenants.
It is the responsibility of the seller or landlord offering the accommodation for sale or let to make an EPC available for their building. A lease assignment would be considered to be a sale and the assignor should provide the EPC.
The seller or landlord is responsible for ensuring there is an EPC for the building, or part of the building, being sold or let, even if an agent or another service organisation is acting on their behalf or providing an EPC. The seller or landlord should therefore ensure any agents acting on their behalf are complying with the Regulations.
How can an estate agent be sure that the relevant person has commissioned an Energy Performance Certificate?
Agents will have to satisfy themselves that an Energy Performance Certificate is either available or has been commissioned before they start marketing on behalf of the seller or landlord. Trading Standards Officers can ask for evidence of this.
What happens after 28 days if the Energy Performance Certificate is still unavailable?
If the building is still on the market after 28 days, Trading Standards Officers may choose to serve a penalty notice.
What is the penalty for a breach?
For domestic properties the penalty is £200. For non-domestic properties the penalty is a sum equivalent to 12.5% of the rateable value of the building, subject to a minimum of £500 and a maximum of £5,000. Where this can not be applied, a default penalty of £750 would be issued.
Who is liable for the penalty charge?
If the relevant person or a person acting on their behalf has not commissioned an Energy Performance Certificate after the 28 day period they may be liable for a penalty charge.
Why energy performance certificates are required.
An Energy Performance Certificate (EPC) is intended to inform potential buyers or tenants about the energy performance of a building, so they can consider energy efficiency as part of their investment or business decision to buy or occupy that building.
An EPC will provide an energy rating for a building which is based on the performance potential of the building itself (the fabric) and its services (such as heating, ventilation and lighting). The energy rating given on the certificate reflects the intrinsic energy performance standard of the building relative to a benchmark which can then be used to make comparisons with comparable properties. It is accompanied by a recommendation report, which provides recommendations on how the energy performance of the building could be enhanced, together with an indication of the payback period.
What is an EPC and what does it mean?
The EPC looks broadly similar to the energy labels now provided with vehicles and many household appliances. Its purpose is to indicate how energy efficient a building is. The certificate will provide an energy rating of the building from A to G, where A is very efficient and G is the least efficient. The better the rating, the more energy efficient the building is, and the lower the fuel bills are likely to be. The energy performance of the building is shown as a Carbon Dioxide (CO2) based index. Each energy rating is based on the characteristics of the building itself and its services (such as heating and lighting). Hence this type of rating is known as an asset rating.
The asset ratings will reflect considerations including the age and condition of the building. It is accompanied by a recommendation report, which provides recommendations on using the building more effectively, cost effective improvements to the building and other more expensive improvements which could enhance the building’s energy performance.
What contributes to the Energy Performance of a building?
The energy rating of a building is a complex calculation that is based on a combination of factors. The key factors are:
- the type of construction of the building (including age, condition, walls, roofs, floors and glazing)
- whether parts (zones) of the building are used for different purposes eg office, factory etc, and the occupancy profile for each zone
- heating, cooling, ventilation and hot water systems used
What an energy assessment involves.
Only accredited software may be used to assess the energy performance of a building and produce the EPC. The SBEM ( Simplified Building Energy Model ) software assesses the energy demands of each individual space in the building in accordance with the activity conducted within that space (examples being office space, kitchens, storage space etc). Different activities can result in different periods of occupancy and different required temperatures, as well as varying requirements for lighting and hot water supply. The energy consumption and carbon dioxide emissions are calculated by considering these demands in relation to the details of the building services. The energy assessor will need to understand the internal layout of the building and for what purpose it is used. The Energy Assessor will need to validate (via plans and/or physical survey) zone distances, thermal insulation and building services.
The recommendation report that is included with an EPC will help owners and occupiers to improve the energy efficiency of a building. The recommendations only include those improvements that are appropriate for the building that has been assessed.
Penalties for not having an EPC.
Failure to make available an EPC when required by the Regulations means you may be liable to a civil penalty charge notice. The penalty for failing to make an EPC available to any prospective buyer or tenant when selling or letting non-dwellings is fixed, in most cases, at 12.5 per cent of the rateable value of the building, with a default penalty of £750 where the formula cannot be applied. The range of penalties under this formula are set with a minimum of £500 and capped at a maximum of £5,000.
How long are EPCs valid for?
An EPC for a non-dwelling will be valid for 10 years or until replaced with a newer one.
Can a prospective tenant or buyer waive their right to receive an EPC?
The relevant person has a duty to make available an EPC to a prospective buyer or tenant and will be liable to a penalty charge if he fails to do so, irrespective of whether the prospective buyer or tenant purports to waive an entitlement to receive the certificate.
Do I have to act on the recommendations?
You are under no obligation to act on the recommendations for energy improvements to the building. However, taking action on the recommendations is likely to improve the energy efficiency of your building, reduce your fuel bills, cut its carbon emissions and could make it more attractive to potential buyers or tenants in the future.
Situations where an EPC is not required.
EPCs are not required on construction, sale or rent for:
- places of worship
- temporary buildings with a planned time of use of less than two years
- stand-alone buildings with a total useful floor area of less than 50m2 that are not dwellings
- industrial sites, workshops and non-residential agricultural buildings with low energy demand
- lease renewals or extensions
- compulsory purchase orders sales of shares in a company where buildings remain in company ownership
- lease surrenders
EPCs are not required on sale or rent for buildings due to be demolished. The seller or landlord should be able to demonstrate that:
- the building is to be sold or let with vacant possession
- the building is suitable for demolition and the resulting site is suitable for redevelopment
- they believe, on reasonable grounds, that a prospective buyer or tenant intends to demolish the building (eg on evidence of an application for planning permission).