Updated MEES regulations – what do they mean for commercial property?

This Saturday, 1st April, marks a significant milestone for commercial environmental governance with a change in the Minimum Energy Efficiency Standards (MEES) making it unlawful, without permitted exemption, to let commercial property that has an energy performance certification of F or G. This is not an April Fool!

Estimated to affect 18% of current commercial property , the new MEES regulations will apply to commercial, retail and residential stock that are required to have an EPC rating across England and Wales. Exclusions will be made to short leases of less than six months (with no right of renewal) and long leases over 99 years.

Landlords that fail to adhere to the new MEES regulations could find themselves liable to a fine of up to £150,000 as well as being placed on a ‘non-compliance’ register.

This change in MEES regulations is a precursor to a proposed EPC B by 2030 requirement, to be achieved with a phased implementation targeting:

  • 1 April 2025: any newly rented property needing a minimum EPC rating of C.
  • 1 April 2027: all non-domestic rented buildings must have improved the building to a minimum of EPC C, or registered a valid exemption.

The new governance also comes on the back of the recent Government consultation and proposed new mandatory energy rating that asked developers and operators of both commercial and industrial buildings for feedback on annual energy disclosure. We previously explained the 12 important things to think about in relation to adopting a NABERS Design for Performance approach which could help achieve compliance and how the new proposed legislation might affect landlords here.

Associate Sustainability Consultant at Hilson Moran, Anna Tsoumi, said

“The new minimum energy efficiency standard will change the scenery and reinforce the actions for the net zero carbon trajectory. EPCs are still essentially a benchmarking tool and the carbon quantification could be improved; but this is a first step to promote electrification and incentivise landlords, even with long leases, to work collaboratively with tenants and design professionals to upgrade old building stock.”

If you would like more information or guidance on the latest or proposed environmental governance, and how the team at Hilson Moran could help, please contact Anna Tsoumi.

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