An Important Reminder for Landlords – Energy Performance Certificates!
16th February 2011
Landlords should be reminded of the importance of complying with the law by commissioning an Energy Performance Certificate (“EPC”) when marketing their commercial premises for sale or lease. Indeed, such EPCs have been necessary since 1st October 2008 but still remain insignificant in many landlords’ and tenants’ minds which should not be the case.
An EPC rates the energy performance of premises and details recommendations for improvement. These ratings are similar to those found on white goods and are graded from (A) being ‘very efficient – lower running costs’ to (G) ‘not energy efficient – higher running costs’. In the current climate both economically and meteorologically, it has to be in everyone’s interest to ascertain the efficiency of a building. Of course, a landlord with an EPC confirming high energy efficiency may justify the higher rental/sale price for which he is aiming to lease or market the premises.
An EPC, once issued, is valid for 10 years and a landlord can accordingly bear in mind that, hypothetically, should a tenant exercise a break after say, 2 or 3 years, the EPC will still be valid for production to a new tenant.
Conversely, a tenant must be able to produce a current EPC to either a future assignee or sublessee thus demonstrating the tenant’s need to request one from a landlord upon the grant of a new lease.
So what happens if you decide not to commission an EPC? Trading Standards undertake the enforcement of EPCs and their Officers can request copies of the same. Any breach of the Regulations is a civil offence and penalties amount to 12.5% of the rateable value of the premises, the minimum penalty being £500 and the maximum being some £5,000. Surely a Certificate which lasts for 10 years is worthwhile for any commercial property owner!
By Tracey Cartwright
Certified paralegal
