Legislation
The Energy Performance of Buildings (Certificates and Inspections) (England and Wales) Regulations 2007 is the government’s direct response to their duties under the European Energy Performance in Buildings Directive (EPBD) in 2002.The regulations state that an EPC should be provided free of charge to prospective buyers or tenants. However, a landlord may organise an EPC for the whole building and may (depending on the terms of the lease) be able to recover the cost of producing a certificate, via the service charge. The exception to this rule is where a lease is to be assigned when it becomes the responsibility of the “assignor” to provide the EPC.The EPC must be available when the building is viewed by prospective tenants or purchasers or when any written information about the building is provided as the result of a request by a prospective purchaser or tenant.
An EPC should be ordered in good time and at least 14 days before it is required to avoid any penalty charges.The CLG Guidance states that when selling or letting a part of a building which is served by a common heating system the seller or prospective landlord has a choice:-
They can prepare or make available an EPC for the whole building orcan prepare or make available an EPC for a part designed or altered to be used separately being offered for sale or rent.
For Buildings with separate parts and separate heating systems:
An EPC should be prepared or made available for each part of a building that is being offered separately for sale or rent.The EPC should reflect the services in those parts being offered for sale or rent.
Removing any heating systems from the property does NOT avoid the need for an EPC.Government legislation states ‘If heating is likely to be fitted then an EPC is required’ – this applies not only to buildings where the heating has been removed but also to buildings due to be re-furbished or re-fitted.
The following buildings are exempt:
Places of worship; buildings of less than 50 sqm (except for dwellings);buildings with a planned time of use of 2 years or less;buildings with low energy demand (e.g. barns);to be demolished (in certain limited circumstances).
The purpose of providing an EPC during the sale or letting process is to enable potential buyers or tenants to consider the energy performance of a building as part of their investment.
Not all transactions will be considered to be a sale or let to which the duties apply. These will include:
1) Lease renewals or extensions2) Compulsory purchase orders3) Sales of shares in a company
Remember that although the fines are capped at £5,000 per non-compliance, this is multiplied by every time a prospective purchaser or tenant is contacted without an EPC being in place!
If you are unsure of just where you stand in terms of the legislation then please feel free to call us.