MEES is a set of Minimum Energy Efficiency Standards set out by the Government for commercially-let properties.

From April 2018, new MEES rules mean a landlord cannot renew or grant a new tenancy of longer than 6 months if their property has an EPC rating of ‘F’ or lower. Anything lower will mean the landlord is liable to pay a substantial fine.

The minimum efficiency standard is there for two reasons:

• Making sure the UK’s housing stock is more efficient benefits the Government because it helps them reach carbon reduction targets. The Government has committed to reducing carbon emissions 57% by 2030 on 1990 levels. More efficient heating systems and better insulation means less heating required by tenants. Some current forms of energy generation are carbon-heavy and therefore lowering energy demand is better for the environment.
• Good news for Domestic and Commercial tenants because they’re the ones paying the bills. Living in a very inefficient house or running an inefficient commercial property means more money spent on heating and lighting – therefore it is worthwhile for tenants to encourage their landlord to install energy saving measures.

Although enforced home improvements may not be the most welcome news for landlords, it should be seen by them as a value-adding opportunity. Tenants and property developers will often take the EPC rating of the property into account before renting or buying.

What you need to know and what to do

If you have commercial or domestic properties that do not meet the new MEES requirements, then you need to start bringing these properties up to standard, in line with the legislation.

• Step 1 – Evaluate the EPC rating of your property stock – List all properties that currently have an EPC rating of E, F or G.
• Step 2 – Complete a MEES Compliance Advisory Report to allow us to identify correct improvement opportunities. – An analysis of the current EPC for your property by our accredited Energy Assessors who will remodel the existing EPC. This is a technical desktop review and will allow us to take into consideration any improvement works that your property may require.
• Step 3 – Detailed remodelling and analysis with improvement plan (MEES Compliance Advisory Report) – Once we have established the current situation in step 2 above, it will allow us to make a bespoke set of recommendations for energy efficiency improvements for your property. Using our remodelling tool, we can make changes dependant on costs, payback periods and your personal preferences.
• Step 4 – Making the improvements – Once the improvements have been made we can then organise the survey on your properties.

• Note: – EPCs dated before April 2012 will be difficult to re-model, albeit they are still valid from the validity point of view. However, the EPC engine was updated in 2012 with a major update on energy efficiency calculations.

Exemptions

The following buildings are exempt from the new regulations and do not need any form of certificate:-

• Listed buildings – as long as they do NOT have a current Energy Performance Certificate
• Buildings due to be demolished
• Leases less than six months of over 99 years

The following examples are where the buildings will be exempt but will need to provide evidence from an experts report:-

• Improvement measures are not within a 7 year payback.
• The changes needed will reduce the value of the property by 5% or more.
• Installing wall insulation could damage the property.
• It is not possible to gain the consent for the works to be completed required from the tenant, lender or superior landlord.

Penalty charges and enforcement

It will be the responsibility of the local authority to enforce the regulation and record exemptions on the national exemption register. Penalties for non-compliance of Minimum Energy Efficiency Standards in Commercial properties are as follows:-

• Non-compliance – Fine of £5,000 and publication of non-compliance.
• Providing misleading information – Fine of £5,000 and publication of non-compliance.
• Renting out a non-compliant property for up to 3 months – 10% of rateable value with a minimum penalty of £5,000, a maximum penalty of £50,000 and publication of non-compliance.
• Renting out a non-compliant property for more than 3 months – 20% of rateable value with a minimum penalty of £10,000, a maximum penalty of £150,000 and publication of non-compliance.

Domestic properties

Key dates for domestic properties

• 1 April, 2016 – Domestic tenants can request energy efficiency improvements to properties, and these cannot be reasonably refused.
• 1 April, 2018 – The regulations apply to new leases granted to new tenants and lease renewals granted to existing tenants.
• 1 April, 2020 – The regulations apply to all leases, including leases that already exist with tenants in occupation.

Exemptions

Domestic property are exempt under the same rules as for non-domestic properties highlighted above.

Penalty Charges and Enforcement

• Non-compliance – Fine of £2,000 and publication of non-compliance.
• Providing misleading information – Fine of £1,000 and publication of non-compliance.
• Renting out a non-compliant property for up to 3 months – £2,000 fixed penalty.
• Renting out a non-compliant property for more than 3 months – £4,000 fixed penalty.

Domestic exemptions:

• Where a recommended measure is not a “relevant energy improvement” because the cost of purchasing and installing it would exceed the £3,500 cap (inc. VAT) (“high cost” exemption) (regulation 24)
• Where all relevant improvements have been made and the property remains below an E (regulation 25 (1)(a))
• Where the property is below EPC E and there are no relevant improvements (regulation 25(1)(b))
• Wall insulation (regulation 24 (3))
• Third party consent exemption (regulation 31)
• Property devaluation exemption (regulation 32 and regulation 36(2))
• Temporary exemption due to recently becoming a landlord (regulation 33 & regulation 36 (2))

Non-domestic exemptions:

• Where all relevant works have been done but the property remains substandard (Regulation 29)
• Third Party Consent exemption (Regulation 31 and Regulation 36)
• Relevant Energy Efficiency Improvements and Special Provisions for Wall Insulation (Regulation 28(2))
• Property devaluation exemption (Regulation 32 and Regulation 36 (2))
• Exemption due to recently becoming a landlord (Regulation 33 & Regulation 36 (2))