Are Britain's commercial buildings ready for the EPC ratings crackdown?

28% of commercial buildings currently have an EPC rating lower than C, putting them at risk of non-compliance.

Related topics:  EPC,  Commercial,  Compliance
Property | Reporter
29th February 2024
Energy Efficiency 505
"Significant support and change is needed to upgrade these buildings’ roofs, insulation and renewable energy sources to become more efficient in the coming years"
- Matthew Jones - Jones and Woolman

As the UK speeds towards a net zero target, roofing expert Jones and Woolman UK is revealing that up to a quarter of the commercial property market could currently be at risk of not meeting 2027’s proposed C-rating target standard for energy performance.

Energy Performance Certificates ratings exist to rate a building’s energy efficiency from A* - G, and are required for all commercial buildings at the point of construction, selling, or letting. In the context of commercial buildings, ratings are recorded for non-domestic building types such as retail units, centres, factories, and offices.

According to a study by Jones and Woolman UK of the latest government data on EPC ratings for 20231, 140,796 non-domestic lodgements were rated last year in England and Wales. Of these, the most common rating was a C, with just over a third (35.6%) - or 50,148 commercial buildings - receiving this rating in the last year.

Only 421 non-domestic buildings - or 0.3% - received the highest A* rating, and just 5% were rated an A; highlighting progress to be made in energy efficiency for buildings to reach the top end of performance.

However, Jones and Woolman UK’s study has found an improvement year-on-year when comparing 2023 to 2022 figures. A* - C ratings account for 72% of all ratings in 2023, which is a significant increase on 2022, where just 66% received A* - C EPC ratings.

Matthew Jones, Sales Director at Jones and Woolman UK predicts how many are at risk of non-compliance by 2027.

He explains: “The EPC ratings for the last year are a good indicator of the state of the commercial buildings across Britain and how they are faring in energy efficiency.

"However, what’s concerning is that the current figures indicate that over a quarter (28%) would be at risk of non-compliance with MEES (minimum energy efficiency standards) if the proposed government plans to bring a minimum C rating come into effect. More than 39,000 commercial buildings were rated D - G in the last year, which accounts for 28% of the non-domestic ratings recorded in 2023.

"Significant support and change is needed to upgrade these buildings’ roofs, insulation and renewable energy sources to become more efficient in the coming years.”

How can buildings improve energy efficiency by the proposed 2027 target?

Matthew offers advice on commercial property EPC compliance for 2027: “From 1st April 2023, it became an offence to continue to let or rent out a commercial property if it does not have a rating of at least at E, with a penalty based on the rateable value of the building between £10,000 to £150,000 per breach.

"And with likely penalties for non-compliance of an EPC rating of C or above in three years’ time, not only would a D rating or lower impact businesses financially, but it could also affect income and cause operational downtime during the completion of energy efficiency improvement works.

“There are many parts at play to improve a building’s energy efficiency. The key area we work with our clients on is their roofing performance, and roofing upgrades and maintenance account for around 20% of our total work so far this year, compared to installation at the construction and design stage of new commercial buildings. Which in itself highlights the efforts being made to improve energy efficiency in the commercial building sector.

“The holistic relationship of weatherproofing and the building envelope is crucial for a healthy and energy-efficient roof and building with a long lifespan. However, it’s not as simple as just upgrading a roofing system or adding renewable energy sources like solar PVs to a commercial building to improve an EPC rating.

"It requires a much more thorough approach and analysis of the building in the context of its function and age. We are urging commercial building landlords and property owners to consider their current rating and assess improvement works needed sooner rather than later, with so many (a quarter) facing the challenge of being C or above in the next three to four years to remain operational.”

More like this
Latest from Financial Reporter
Latest from Protection Reporter
to our newsletter

Join a community of over 20,000 landlords and property specialists and keep up-to-date with industry news and upcoming events via our newsletter.