MEES and you: commercial landlords
On 1 April 2018 a new legal standard for minimum efficiency is due to be introduced for rented commercial buildings, known as the Minimum Energy Efficiency Standards (“MEES”).
From 1 April 2018 landlords who fall within the scope of MEES must not renew existing tenancies or grant new tenancies if the building has an energy performance rating of E or below.
MEES work in conjunction with the existing Energy Performance rules and so both need to be considered.
The current EPC exemptions will continue to apply. For example an agricultural building with low energy demand may not need an EPC and therefore is not caught by MEES.
There are also MEES exemptions for where a building does not meet the minimum standard:-
- You have done all you can to improve the energy efficiency but the building is still below the minimum standard;
- The required improvements would reduce the value of the building by more than 5%;
- Consent of a third party is required where the conditions that are attached to the consent cannot be reasonably complied with.
A MEES exemption needs to be registered centrally with the government and will only apply for five years. The exemption is also personal to the landlord who registered it and so cannot be transferred to a new landlord on the transfer of a building.
Penalties can be enforced for failure to comply and these will be based on the building’s rateable value. A breach for three months or less will result in a penalty of 10% of the rateable value (with a minimum of £5,000 and maximum of £50,000). A breach in excess of three months will result in a penalty of 20% of the rateable value (with a minimum of £10,000 and a maximum of £150,000).
It is therefore important that landlords start to consider the effect of these new energy efficiency regulations and take action where needed sooner rather than later.
Fenella Eddell is a solicitor in the property department at Barker Gotelee, Suffolk solicitors.
Property Solicitors – for more information on our range of legal services, please call the team on 01473 611211 or email [email protected]
