Energy Performance Certificates

Energy Performance Certificates ( 'EPCs') were introduced pursuant to the Directive 2002/91/EC on the Energy Performance of Buildings adopted by the Energy Performance of Buildings (Certificates and Inspections) (England and Wales) Regulations 2007 (the EPD Regulations)

The EPC looks broadly similar to the energy labels now provided with vehicles and many household appliances. Its purpose is to indicate how energy efficient a building is. The certificate will provide an energy rating of the building from A to G, where A is very efficient and G is the least efficient. The better the rating, the more energy-efficient the building is, and the lower the fuel bills are likely to be. The energy performance of the building is shown as a Carbon Dioxide based index. Each energy rating is based on the characteristics of the building itself and its services (such as heating and lighting). The asset ratings will reflect considerations including the age and condition of the building. It is accompanied by the Recommendations Report, which provides recommendations on using the building more effectively, cost effective improvements to the building and other more expensive improvements which could enhance the building's energy performance.

The certificate is accompanied by a report which includes cost-effective recommendations to improve the energy ratings. For each improvement indicative payback times are listed. Short term measures are calculated to give a pay-back in one to three years. Medium term measures are calculated to pay-back within three to seven years, and long term measures have a pay-back of over seven years. There are no legal obligations to implement any of the advice in the report, however, if a building owner decides to do so, expert advice is advised beforehand.

How long will the EPC last?

The EPC will last for 10 years provided that there are no material alterations to the building within that time.

When are EPCs required?

The current regulations at a glance:

• A valid EPC will be required on the sale or letting of any commercial or residential property.
• The front page of the report is required to form part of /or be attached to the marketing particulars
• Marketing can commence if instructions have been issued to the EPC provider but the EPC must be in place within 7 days of the commencement of marketing of the property

The six commercial EPC exceptions

1. Places of worship
2. Temporary buildings, with a life of less than 10 years
3. Buildings that are to be demolished upon completion of the sale
4. Buildings smaller than 50 m² that are not dwellings
5. Certain industrial sites, workshops and non-residential agricultural buildings which have a low energy demand.
6. On "lease renewal" to an existing tenant

The Assessment

As part of this assessment we are required to verify information about the property including: the build date; construction materials; internal and external dimensions of building; the internal configuration; full details of the heating and any air conditioning systems, and we also undertake a full window and lighting survey. Photographs and other documentary evidence must be produced to verify the data.

We undertake a site visit and produce a simple scaled drawing of the property from which we define a number of different zones. Each of the defining elements of these zones and their services must be recorded and the data is then inputted onto the government approved computer software "iSBEM" and will then be checked for its accuracy. Once all the data is recorded an EPC can be produced together with an accompanying report setting out a number of recommendations for increasing the energy efficiency of the building. After payment the EPC will then be lodged for registration on the national database.

Penalties for non compliance

The potential liability for a vendor or landlord and (now) its agent selling or letting a commercial property without an EPC certificate, is set out in the extract from CLG guidance below:

"The penalty for failing to make an EPC available to any prospective buyer or tenant when selling or letting non-dwellings is fixed, in most cases, at 12.5 per cent of the rateable value of the building, with a default penalty of £750 where the formula cannot be applied. A formula is used as the costs of producing an EPC for non dwellings are expected to vary according to the size, complexity and use of the building. The range of penalties under this formula are set with a minimum of £500 and capped at a maximum of £5,000."