This information should not be interpreted as financial, tax or legal advice. Mortgage and loan rates are subject to change.
Category: renters reform bill
Labour have confirmed their plans to launch an official consultation, into new energy efficiency standards in the Private Rented Sector (PRS), within the next few weeks.
Due to lengthy delays and lacklustre communication with the public, there has been much confusion surrounding Labour’s strategy for increasing energy efficiency standards.
As part of their Net Zero agenda, Labour have pledged to enforce that all PRS homes reach a ‘C’ grade on their EPCs (Energy Performance Certificate) by 2030. Until that point, PRS properties with ‘E’ and ‘D’ grades can be legally rented out. There are no such energy performance standards in place for social housing, however.
Questions of efficacy and exemptions
This study will be enlightening in terms of whether or not the current EPC criteria is effective at ensuring energy efficiency, and lingering questions about properties that could be exempted from the current targets may finally be answered.
Many private landlords have misgivings against the entire model, in particular Labour’s push to get all properties up to the same uniform standard, including older heritage properties. Structural differences between properties may make task of achieving a ‘C’ grade more difficult and expensive for some landlords.
Addressing these concerns, energy minister Miatta Fahnbulleh released the following statement in response to a written query:
The government will consult shortly on increasing minimum energy efficiency standards in the domestic private rented sector. The consultation will include proposals for rented homes to achieve Energy Performance Certificate C or equivalent by 2030.
In this consultation, we will set out proposals on the exemptions regime for properties that cannot meet the proposed increased standard. We encourage landlords and other key stakeholders to feed into this consultation when it is published.
This invitation for landlords and stakeholders to submit feedback to the eventual published study is promising, especially if the results validate landlords’ concerns.
How effective councils are at enforcing EPC standards is increasingly questioned, as well. The estate agency software provider Reapit discovered that a surprisingly low number of fines have been issued to rogue landlords that failed to comply with the existing EPC standards.
Between October 2008 and August 2024, only 147 fines had been sent out for EPC violations. If many landlords are unable to keep up with Labour’s targets, as many predict, will the government also pressure councils to crack down on those that don’t comply?
A new study, or an extension of an ongoing one?
What may confuse matters is the fact that the government have supposedly been in the process of a consultation related to improving the EPC system since December 2024, and its findings are due to be published later this year.
It’s not entirely clear if Fahnbulleh was referring to this ongoing study in her above answer, or if there is another study due to be conducted that deals specifically with exemption criteria for PRS properties.
Unless the results of these consultations are particularly damning, it does not look like outright replacement of the EPC system is on Labour’s agenda. While they were in government, the Conservatives planned to introduce a new system for measuring energy efficiency in PRS properties called the HEM (Home Energy Model).
But due to lack of official confirmation about the fate of this scheme in over half a year, it is widely assumed that HEMs were quietly swept under the rug as soon as Labour came into power.
Meanwhile, an analysis by epIMS, an online platform for landlords wanting to track their energy performance, found that a staggering third of all properties on sale in the UK do not meet Labour’s ‘C’ grade target, with the average cost needed to get a landlord over the line estimated to be £8,000.
The likelihood that all of these properties could reach the target by 2030 is low, to put it mildly.
We will keep you updated on the results of Labour’s EPC analysis, and what actions they propose to take going forward.
