THE MARSHALL & GALPIN GUIDE TO
ENERGY PERFORMANCE CERTIFICATES FOR COMMERCIAL PREMISES

From 6 April 2008, commercial buildings will need EPCs whenever they are constructed sold or let. This new regulation stems from the European Energy Performance of Buildings Directive, which requires all European countries to establish minimum energy performance standards for buildings.

What is an EPC?

The purpose of the EPC is to record the energy efficiency of premises and its aim is to enable prospective owners, buyers and tenants to use the information to consider energy efficiency and fuel costs as part of their investment or business decision to buy or occupy any building.

The EPC is commissioned by the seller (or their agent) from an accredited Energy Assessor, who visits the property to collect the relevant data and creates the certificate. The Energy Assessor will investigate both internal and external premises.

The EPC will provide a rating for the building, showing its energy efficiency and its environmental impact on a scale from A-G (where A is the most efficient and G the least efficient), in graphical format (shown below). It will be accompanied by a recommendation report on ways to improve the building's energy rating.

What is the time-table for implementing measures?

• from the 6 April 2008 on the construction, sale or letting of all commercial buildings of more than 10,000 m²

• from 1 July 2008 on the construction, sale or letting of all commercial buildings of more than 2,500 m²

• from 1 October 2008 on the construction, sale or letting of all remaining buildings that are not dwellings

Who provides the EPC?
 

An EPC must be provided free of charge by the person with an interest in the property: the builder, the seller (freehold or leasehold) or the landlord (lease & lease renewal). However, dependant on how the lease is drafted, the landlord of a multi-let building may organize an EPC for the whole building and may be able to recover the cost of producing a certificate via the service charges.

How much does an EPC cost?

The Government has estimated the cost of an EPC survey to be from £250-£500 for small premises and up to £2000 for larger premises. However, these estimates are unrealistic as there is a shortage of trained assessors to handle commercial property, which will undoubtedly drive up the cost of obtaining an EPC and the time it takes to obtain one.

How long is the EPC valid for?

An EPC for non-dwellings is valid for 10 years from the date on which the Energy Assessor issued it (as opposed to 12months for residential premises). This 10-year window therefore allows for the same EPC to be used for successive lettings of the same property or on assignments of leases within that time span. However, if a subsequent EPC is obtained or provided in that 10-year period, the earlier EPC is invalidated.

When must an EPC be provided?

The EPC must be provided at the earliest opportunity, and no later than:

• when any written information about the premises is provided in response to a request for information received from the prospective buyer

• when a viewing is conducted

• if neither of the above occur, before entering into a contract to sell or let

What are the exceptions to the obligation of providing an EPC?

A number of exceptions exist. These are:

• places of worship

• standalone buildings with a total useful floor area of less than 50m2

• temporary buildings with a planned time of use of 2 years or less

• industrial sites, workshops and non-residential agricultural buildings with low energy demand

• in specified circumstances, buildings that are to be demolished

• off-plan sales of lettings before the construction of the building has been completed.

What should you do in preparation for the Energy Assessor?

In preparation for the Energy Assessor’s visit, we would advise you collect as much as possible of the information listed below:

• the year of property construction

• walls and roof construction

• signs of wall-cavity insulation

• energy-saving "green" devices (such as solar panels, for instance)

• number of double glazed windows and when installed

• number of open or closed fireplaces

• make and model of boiler and the type of flue and fuel used

• number of low energy light-bulbs

• type of heating system used and controls (wall thermostat etc...)

• roof insulation and thickness

• Measure the thickness of the hot water cylinder jacket or foam.

• Check for excessive window area in larger houses and take measurements of conservatories and extensions.

• Note the number of habitable rooms that are heated.

• Measure the internal or external areas of the home.

• Sketch and make notes relating to home and room layout.

Do tenants have to give access to the Energy Assessors?
 

Occupiers have a statutory duty to allow access to the Energy Assessors, which will obviate the problem of leases not reserving adequate rights of access.

What are predicted and interim energy assessments?

Predicted energy assessments are for premises that are not yet built. When a building is designed, a predicted energy rating is produced based on the design. This rating should meet the requisite minimum standard as required by the planning building regulations.
Interim energy assessments are required in 2 situations:

• When a property is bought off plan, an interim energy assessment must be provided. However a full EPC is required for the buyer when the home is completed.

• When a property is new premises built in accordance with the energy efficiency requirement of the building regulations that came into force in April 2006. These premises do not require the full EPC, only the energy-efficiency and environmental-impact graphs. 

What happens if an EPC is not provided?

Developers must obtain a valid EPC in order to obtain a completion certificate from the building control inspector.

Owners of existing buildings will be investigated by Trading Standards, who can require the property information within 7 days of request. Financial sanctions follow any breach. The cost of non-compliance will be 12.5% of the rateable value of the premises, subject to a minimum of £500 and a maximum of £5,000.


For further information, please contact:-

James Barnatt (Oxford)    01865 268644  email - mailto:james.barnatt@marshallgalpin.com