Residential landlords required to reach EPC Band C by 2030

Currently landlords in England and Wales cannot let a property with an EPC rating below band E, without a registered exemption as doing so carries a civil penalty of up to £30,000 per property. The band E MEES apply regardless of tenancy length or whether the property is let furnished or unfurnished. 

The EPC itself must be current (less than 10 years old) and lodged on the national EPC register. In practical terms the 2030 standard raises in MEES from E to C mean:

• Band D and E properties that currently comply will need improvement works to reach C.
• Band F and G properties that are currently exempt from the E standard (under a cost-cap or other exemption) will need to be reassessed against the new C standard.
• Band A, B, and C properties already comply and no action is required on energy grounds alone.

The government has not yet published its final regulations for the 2030 standard, however the cost cap (the maximum a landlord is required to spend per property before claiming an exemption) has been confirmed as being £10,000 per property for the band C standard.

Landlords who cannot reach band C within the £10,000 cost cap can register an exemption. Exemptions are recorded on the PRS Exemptions Register which is publicly accessible. 

The main exemptions are:

• Cost cap exemption: All relevant improvements have been made up to the cost cap of £10,000 and the property still cannot reach C. The landlord must evidence that at least three quotes for improvement works were obtained and that the combined cost exceeds the cap.
• Third party consent refused: The works require consent from a leaseholder, freeholder, or planning authority (e.g. Listed Building consent) and that consent was refused. A valid consent application and refusal evidence are required.
• Temporary derogation for new landlord: A landlord who has recently acquired a non-compliant property has a temporary 6-month exemption before the standard applies to enable works to be undertaken.
• Property devaluation exemption: An independent RICS-qualified surveyor has confirmed that the required works would reduce the property's market value by more than 5%. This is a high bar and rarely available.

The aforesaid exemptions last for 5 years (cost cap and devaluation) or until the relevant circumstances change (third party consent). They must be renewed when they expire — the exemption does not run with the property if it is sold.

Theoretically circumstances could be contrived where a tenant’s refusal to consent to a landlord’s request to undertake works to render a property EPC band C compliant in late 2029, would render a property exempt until late 2034, if the recalcitrant tenant remained in situ. 

For landlords who are unable to obtain an exemption, a systematic approach is required:

• Review the current EPC ratings for your property on the government’s database.
• If your property is band A (no action) / B (no action) / C (no action) / D (likely improvable within cost cap) / E (higher cost) / F or G (immediate compliance issue under current law).
• Check when the EPC was lodged. EPCs lodged before 2018 may be out of date. A property that was D in 2015 may now be E if the boiler has not been replaced — or C if it has. Refresh old EPCs before budgeting.
• Obtain improvement quotes if the property falls into EPC band D and E properties. Focus on the lowest-cost route to C using the recommended measures in the EPC.
• Register exemptions where applicable. 

If you are a landlord requiring further assistance or legal advice on EPC ratings for your property, please contact Mustafi Sidki on or a member of our Dispute Resolution team.