Energy Performance Certificate

An EPC is a certificate that must be provided by the seller or the landlord of the property when the property is being sold or rented out.

The provision of EPCs have been a statutory requirement from January 2008 over introduced as part of the EU directive on energy performance of buildings which came into effect progressively from 2007

EPC shows the energy efficiency rating in terms of running costs for a building based on the performance potential of both the fabric of the building and the services serving the building for example, heating, insulation ventilation and fuels used. The ratings used in any PC are based on “standard occupancy” and may differ from the actual use of the building.  The recommendations on how the energy performance the building can be improved include an indication as to the time it will take to recoup the cost of the improvements.

The EPC provides an energy efficiency rating from “A” to “G” with A being the most efficient and G being the least efficient. The building with the better rating is likely to have the lower fuel bills.

  • The minimum information that an EPC must contain include:
  • the asset rating for the building
  • a reference value (benchmark)
  • a recommendation report
  • reference number
  • the address the building
  • an estimate of the building’s total useful floor area
  • the date on which the energy performance certificate was issued

Who Produces an Energy Performance Certificate?

The energy assessments required to produce an EPC for a property are carried out by an accredited domestic energy assessor. Energy assessors can be self-employed, employees of service organisations such as surveyors or energy companies or employees of the landlord or owner. Energy assessors must be a member of a government approved accreditation scheme.

How Is the Energy Performance of the Building Calculated for the Purposes of an EPC?

The following factors are taken into account when calculating the energy efficiency of a building:

  • the type of building- (flat, house or bungalow, detached, semi-detached or terraced)
  • age of the building
  • number of habitable rooms (excluding kitchens, bathrooms, hallways, stairs and landings)
  • whether the property has been extended
  • loft conversions
  • the dimensions of the building and the number of floors
  • the amount and type of glazing (single, double or triple glazing)
  • the material used to construct the property (brick, stone, timber frame and so on)
  • insulation
  • roof construction (flat, pitched)
  • the number of chimneys and open flues
  • heating systems and the type of fuel used

The rating is calculated on the basis of a standard occupancy to ensure that the results are consistent for similar buildings to avoid variations caused by differing energy usage patterns of individual occupants.

For existing buildings the energy assessor must undertake a physical survey of the building. In the case of new buildings, the energy assessor will have access to accurate plans, specifications and other relevant information which can be used to do the energy assessment and obviate the need for a site visit.

When is an EPC required?

Whenever a property is built, sold or rented out, on the open market,  the owner of the property must provide a potential buyer or tenant with an Energy Performance Certificate (“EPC”). The EPC is designed to show the energy efficiency of the property and provide recommendations of how the energy efficiency of the property may be improved.

EPCs are produced for any “building unit” this may be a whole building or part of a building. The criteria for a building unit is that it has its own access and a separate heating and ventilation system which the occupier to be able to independently control the services, an example might be a self-contained flat in the building.

An EPC is valid for 10 years or until a new EPC is produced for the same building (this applies no matter how many times property sold within the 10 year period).  Any advertisement in the commercial media for the sale of a building or if the property is being advertised for rent must include an energy performance indicator as shown on the EPC certificate for example if the property is rated as being in “band C” this must be shown on the advertisement however there is no requirement to display the full EPC.

If there is not already an EPC available for the property being sold or let, the landlord or seller must commission an EPC before the property is advertised on the open market. The EPC must be obtained within 7 days of the property being marketed (a further 21 days allowed if after all reasonable efforts EPC cannot be obtained within 7 days).

An EPC must be made available to potential buyer or tenant when the first request for information about the property is received or a request to view the property is made. EPCs must always be provided to the buyer or tenant free of charge.

When is an EPC not required?

If a landlord can demonstrate that the building fits any of the following criteria they will not require an EPC:

  • the temporary building with a planned time of use of 2 years or less
  • the stand-alone building with a total useful floor area of less than 50 m²
  • A building which is officially protected as part of the designated environment or because the special architectural or historic merit where compliance with certain minimum energy efficiency requirements would unacceptably alter their character or appearance (an example would be a listed building)
  • a residential building intended to be used for less than 4 months of the year a building where the landlord would reasonably expect the energy consumption of the building to be less than 25% of all year-round use

Further exemptions may be:

  • the building is suitable for demolition
  • the resulting site is suitable for redevelopment
  • all relevant planning permissions, listed building consents conservation area consents exist in relation to demolition, and
  • in relation to redevelopment, either outline planning or planning permission exists and where relevant, listed building consents exist

Holiday lets do not need an EPC unless they are rented out as a furnished holiday lets (according to HMRC criteria) and are rented out for a combined total of 4 months or more in any 12 month period and even then, an EPC will only be required if the tenant is responsible for meeting the energy costs the property.

The letting of a single room will not require an EPC, as it is not a building or a building unit designed or altered the separate use. 

EPCs may not be required where the transaction is not considered to be a sale or rental. Examples include:

  • the extension or renewal of the lease
  • compulsory purchase orders
  • sales of shares in the company, whether buildings remain in company ownership
  • the surrender of a lease

Penalties for Non-Compliance with the EPC Regulations:

A penalty charge of £200 is payable if the seller or the landlord fails to comply with the EPC regulations in the following manner:

  • when selling or renting a property the seller or landlord fails to make a valid EPC available free of charge to the prospective buyer or tenant
  • when marketing property, the seller or landlord did not commission an EPC before the property was put on the market
  • the person acting on behalf of the seller or landlord (for example the estate or letting agent) did not ensure that an EPC was commissioned for the property
  • seller or landlord (or their agent) did not obtain an EPC within 7 days of the property being put on the market
  • the seller or landlord (or their agent) did not obtain an EPC for the building within 28 days of the property be put on the market.

The seller or landlord (or their agent) did not include an energy performance indicator in any advertisement for the sale or rental of property.

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