New EPC Rules for Commercial Property

With effect from 1 April 2023, EPC rules for commercial properties were introduced by the government.

What is an EPC?

An Energy Performance Certificate (EPC) is a rating on the energy efficiency of a building from A (the most efficient) to G (not efficient at all).

EPC requirements are already in place for residential property lettings and new rules mean that if you are a residential landlord, you must have an EPC rating of C or above:

• For new tenancy agreements from April 2025.
• Existing/roll over tenancy agreements from April 2028.

When do you need a Commercial Premises EPC? 

From April 2023 owners and landlords of a commercial property must have an EPC if:

• You rent out or sell the premises.
• A commercial building under construction has been completed.
• There are changes to the number of parts used for separate occupation and these changes involve providing or extending fixed heating, air conditioning or mechanical ventilation systems.

You can be fined between £500 and £5,000 based on the rateable value of the building if you do not make an EPC available to any prospective buyer or tenant.

Displaying a Commercial Property EPC

You must display an EPC by fixing it to your commercial property if ALL these apply:

• The floor area is over 500 square metres.
• The building is frequently visited by the public.
• If you already have an EPC ready for the building’s sale, rental or construction.

How Much Does an EPC Cost and Where to Get One?

For most smaller shops and offices, we would expect the cost to be no more than £150 to £300.  If the commercial property is larger then you can expect to pay more.

If you search online locally, there will be a number of accredited EPC surveyors in your area.

Validity

As with existing residential property EPCs, all commercial EPCs are valid for 10 years and must be surveyed again upon expiration.

Exemptions from Commercial EPCs

• Listed or officially protected commercial properties where minimum energy performance requirements would require you to alter the building outside restrictions for listed buildings.
• Temporary commercial building only going to be used for 2 years or less.
• Buildings used for worship and religious purposes.
• Commercial premises that have minimal energy use e.g., do you use heating in a sheep pen?
• Detached commercial property with a total floor space under 50 square metres.
• Buildings due to be demolished that have the necessary authority permissions for demolition.

The Future of Commercial Property EPCs:

As noted above for residential property landlord requirements to get energy efficiency and EPCs up to a minimum EPC by 2025 and 2028.  Given the government’s signing of the Paris Climate Agreement and targeting being carbon neutral by 2050 (or earlier if possible) we do expect the government to force commercial property owners to target grade C and above EPCs for their commercial property in the next 5 to 10 years.

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