The Energy Performance of Buildings

EPC regime – Background Information.

Energy Performance of Buildings

Relevant background law

  • Directive 2002/91/EC of the European Parliament and of the Council of 16 December 2002 on the energy performance of buildings.  The objective of the Directive is to promote the improvement of the energy performance of buildings within the community, taking into account outdoor climatic and local conditions, as well as indoor climate requirements and cost-effectiveness.
  • New Part VA inserted into the Buildings Regulations 2000.

Energy Performance of Buildings (Certificates and Inspections) (England and Wales) Regulations 2007 (SI 2007/991) the EPC Regulations as amended by SI 2007/1669 and SI 2007/3302 and the Energy Performance of Buildings (Certificates and Inspections) (England and Wales) Amendment Regulations 2008 (SI 2008/647).  In this context ‘Building’ means a roofed construction having walls, for which energy is used to condition the indoor climate, and includes a part of a building which has been designed or altered to be used separately. This means each unit in a development may need separate certificates.

Energy Performance Certificates (EPCs)- How must they be provided?

By whom?

  • the seller in the case of a sale of a building
  • the prospective landlord in case of a tenancy
  • the contractor (person carrying out the building works) of a new-build property

To whom?

  • the owner of a new-build, or any prospective buyer or tenant

When?

  • at the earliest opportunity; and
  • before entering into a contract to sell or rent out the building; and
  • at the time when the seller or prospective landlord first makes available any information about the building (eg, publishing and on website); or
  • at the time of viewing if a person requests to view the building.

NB: The landlord is not required to provide a revised EPC upon a change of tenancy if the existing EPC is still in date.

What type of buildings?

  • residential
  • put on the market for sale or rental – 14 December 2007
  • construction of new dwellings – 6 April 2008
  • all remaining dwellings must have EPCs by 1 October 2008 at the latest
  • non residential buildings
  • over 10,000 m² – 6 April 2008
  • over 2,500 m² – 1 July 2008
  • all remaining buildings – 1 October 2008

Exceptions

  • where the building is on the market before 6th April 2008 with the intention to sell/let before 6th April 2008 and remains on the market after that time.  The exception is lost and an EPC must be commissioned when contracts are entered into for a building to be sold or let or if it is still on the market on 1 October 2008;
  • places of worship;
  • temporary buildings with a planned time of use of two years or less, industrial sites (NB: industrial site is not defined), workshops and non-residential agricultural buildings with low energy demand (e.g. barns);
  • stand-alone buildings with a total useful floor area of less than 50m² which are not dwellings (e.g. sheds and summer houses);
  • where the seller or prospective landlord has reasonable grounds to believe that the prospective buyer or tenant
  • is unlikely to have sufficient means to buy or rent the building; or
  • is not genuinely interested in buying or renting a building of a general description which applies to the building; or
  • is not a person to whom he is likely to be prepared to sell or rent out the building.

NB: unlawful discrimination is not allowed.

  • in limited circumstances, where the existing building is to be demolished and the site redeveloped (more detailed requirements in Reg. 7 EPC Regulations).

The contents of the EPC

The certificate must:

  • express the asset rating of the building;
  • calculated using a standardised energy performance model, based upon a national methodology (NB: this is not the actual energy usage of the building);
  • set out on an A-G scale;
  • split into Energy Efficiency Rating and Environmental Impact Rating.
  •  include a reference value, such as a current legal standard or benchmark, against which the building’s performance can be judged;
  • include various administrative details such as the address of the building and the name of the energy assessor who issued the certificate;
  • be accompanied by a recommendation report on the improvements that could potentially be made to the energy efficiency of the building – NB: there is no legal obligation to comply with the recommendations;
  • The certificate will be valid for 10 years, so can be reused for subsequent sales/leases.

Display Energy Certificates (DECs)

  • From 1 October 2008, buildings with a total useful area of over 1000m² occupied by public authorities or institutions providing public services to a large number of persons and therefore frequently visited by those persons, will be required to have Display Energy Certificates.
  • Such buildings will include public museums, schools, hospitals and swimming pools, but not hotels or retail outlets.
  • The DEC will need to be produced in addition to the EPC.
  • Private organisations occupying part of a public building will not require DECs.
  • The government is currently considering whether to extend the DEC regime to all public and private sector buildings. This is only likely to happen if it is cost-effective to do so, and further consultation is expected on this issue.
  • The DEC should contain:
  • the asset rating and benchmark (as explained for the EPC above);
  • an operational rating which will show the actual amount of energy used by the building over a 12 month period (NB: first one need only be produced after 15 months’ occupation);
  • the operational ratings of the preceding two years (where appropriate);
  • various administrative details such as the name of the assessor, etc.
  • The DEC will need to be reviewed annually, so that the operational rating can be updated.
  • The certificate must be displayed in a prominent place and be clearly visible to the public.
  • In addition to the DEC, the occupier must also have in its possession an advisory report, which must contain recommendations for the improvement of the operational energy performance of the building. This report is valid for 7 years.

Air Conditioning Assessments

  • The person who has control of the operation of the system must ensure that an air conditioning system (which may be made up of more than one unit) of a total output of more than 12kW is inspected by an energy assessor at regular intervals not exceeding 5 years.
  • The assessor must produce a written report of the inspection and include an assessment of the air-conditioning efficiency and the size of the system compared to the cooling requirements of the building, and contain appropriate advice on possible improvements to the system.
  • If the person who has control of the air conditioning system changes, the system must be inspected within 3 months of the change.
  • Existing air conditioning systems will need to have their first assessments by:
  • 4 January 2009 – where the system’s output is more than 250kW;
  • 4 January 2011 – where the system’s output is more than 12kW.

Other issues for consideration

  • The assessment of the energy performance of buildings must be carried out by a duly accredited assessor.
  • There may not be enough assessors to meet the demand when the 6 April and 1 October 2008 deadlines are reached, so it is essential to plan ahead, particularly in relation to a large portfolio of properties.
  • The government estimates that EPCs will cost from around £250 for small premises, to £2,000 for larger buildings.
  • EPCs must be provided at no cost to the prospective buyer/tenant, so the seller/landlord will have higher transaction costs.
  • All EPC recommendation reports and DEC advisory reports will be recorded in a central register and retained for at least 20 years.
  • Enforcement rests mainly with Trading Standards. Fines of between £200 and £5,000 can be imposed for failure to comply with the EPC Regulations.
  • It is envisaged that the certificates will provide financial incentives to encourage property investors to improve the energy performance of their buildings, in order to be able to market them as clean/green, and thereby obtain a higher price.
  • For new properties, a completion certificate will not be issued until a valid EPC has been obtained.

Summary Table

 14 December 2007 EPCs for dwellings put on the market for sale or let
 6 April 2008 EPCs for construction and marketed sale of all new-build dwellings

EPCs for construction, sale or rental of non-residential > 10,000m2

 1 July 2008 EPCs for construction, sale or rental of non-residential >2,500m2
 1 October 2008

 DECs for all public buildings > 1,000m2
EPCs for sale or rental of all remaining dwellings

EPCs for construction, sale and rental for all remaining non-residential

 4 January 2009 First inspection of all existing air-conditioning systems >250k W*
 4 January 2011 First inspection of all existing air -conditioning systems >12k W*

* Exemption for air-conditioning systems put into service on or after 1 January 2008 which must have first inspection within 5 years of being put into service.

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