EPCs and Listed Buildings – A Costly Minefield
Minimum Energy Efficiency Standards which came into force on 1st April 2018 have meant that any property that is about to be newly let requires an energy performance certificate (“EPC”) rating of E or above (with grade A being the most efficient and G the least). Current regulations dictate that a landlord of a listed or officially protected building is exempt from the requirement for an EPC if the minimum energy performance requirements would “unacceptably alter” the building. The onus is on the landlord intending on renting out a property to ensure that a valid EPC is made available to a prospective tenant when applicable.
This subjective wording is open to interpretation and could prove to be a potential trap for unsuspecting landlords with fines of between £500 and £5000 for a listed commercial building if an EPC is not made available to a prospective tenant when one is in fact required.
So how do you know if works would “unacceptably alter” the building to know if you need an EPC?
Well, the only way to know if you need a valid EPC is to actually commission one so you can then read the recommendation report. It is in this report that you will find the minimum energy performance requirements to obtain an EPC rating of E or above.
How to determine whether the works proposed in the report would unacceptably alter the appearance or character of the building is unclear. Government guidance says that you should seek advice from your local authority conservation officer, who will be able to advise on this and let you know if consent is required (and a fee may be charged for this advice). Historic England also provide advice to this effect, but point out that some local authorities may not have a conservation officer, meaning it is up to the owner to make the decision at their own risk.
Potential landlords of listed buildings need to be prudent in obtaining an EPC if one is required, but also shouldn’t be too quick to make any alterations to their listed premises as it can also be a criminal offence to undertake works to a designated historic building without consent. Depending on the works, listed building or schedule monument consent may be required. Penalties for not obtaining the relevant listed consent can be severe, in the form of unlimited fines, or even imprisonment. Offenders may be prosecuted, or the local authority may serve a listed building enforcement notice on the owner to restore the building to its former state.
As well as this, Landlords need to bear in mind all the usual consents that may be required, including planning permission and building regulations consent.
The EPC recommendation report may list some potential works that will not require consent and cause minimal impact on the appearance or character of the building. Depending on the building, implementing these may be enough to reach the required E rating to make an EPC valid. For the vast majority of listed buildings this will not be adequate to raise the EPC rating enough and the question is then how to decide whether the other recommended works will “unacceptably alter” the building. Seek advice where possible to try and limit your liability in the event that works are subsequently found to be “unacceptable”, and ensure you obtain all of the relevant consents. This is certainly a costly and lengthy process but you don’t want to be caught out for letting a property without a valid EPC when one is required!
Amy is a Paralegal in our Commercial Property team.