EPCs and MEES – up in smoke?
There’s perhaps no better commentator in real estate than Oliver Shah – currently associate editor of The Sunday Times and regular contributor to Green Street News. For those that follow him, it is clear that for Oliver, energy performance certificates (and related minimum energy efficient standards) are currently fertile ground for comment.
In his latest comment piece for Green Street News, Oliver explores the “flawed” nature of EPCs – a certification based on prospective rather than actual energy performance. And interestingly, he touches on the likelihood that, taking actual energy consumption into account, EPC ratings may overestimate the cost of retrofitting. Is the state of commercial property stock that bad after all?
Where does this leave EPCs – one for the net-zero “bonfire”? I agree that EPCs are not going anywhere. However, as Oliver writes, “a radical increase in the accuracy of energy performance assessments must be part of whatever comes next for EPCs”. Yes, who couldn’t agree that more accurate measurement is a good thing? The government consultation of early 2025, as I refer to in this blog, is a step forward. But that is just a consultation, which touches on improving metrics. Plus, what about a true certification based on actual performance? Don’t hold your breath. Back in 2021, the government stated: In large and complex buildings in particular, the evidence is showing that there is almost no correlation between a building’s EPC score and its actual energy and carbon performance in practice. They consulted on what I described as the NABERs based “next generation EPC”. Five years on and that appears on the back “burner” (if live at all).
Linking to EPCs, what about minimum energy efficiency standards or MEES, with the proposed deadlines of EPC C by 2027 and EPC B by 2030? Oliver doesn’t hold back here in this comment piece – “rigid EPC requirements are a legacy of the Covid-euphoria era that deserve to go up in smoke”. Yet should these go on the “bonfire of net-zero pledges”? Will “sticking with the 2027 and 2030 dates crystallise billions of pounds’ worth of value destruction in a cliff-edge manner”? Is it correct to think that the “market will take care of its own problem by pressuring asset owners to upgrade or replace redundant buildings”?
As to the latter, I’m not so sure. MEES, and the prospect of 2027/2030 standards have surely focused minds, brought forward improvements and accelerated the pace of change in real estate stock? We need ambitious regulation to push on. Kicking the can down the road is not an option; although with government inaction, this seems almost inevitable.
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https://greenstreetnews.com/article/shah-on-property-lets-add-epc-targets-to-the-net-zero-bonfire/
