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New Energy Perfomance Certificate Regulations for Commercial Properties

What are the new regulations?

Unless certain exceptions apply, any owners of non-domestic buildings have already been obliged over the last seven/eight years in accordance with EU legislation to provide an Energy Performance Certificate when the subjects are sold or let to a new tenant. However new regulations came into force last month which now require any such owner to also produce an ‘Action Plan’, carried out by an EPC assessor and which will identify targets for improvement of the energy performance of a building and how these targets will be met. An owner of commercial premises which a poor EPC rating can no longer simply pay lip service to the recommendations contained within an EPC therefore.

What properties are affected by the regulations?

Subject to certain exemptions, any non-domestic buildings over 1,000 square metres in size, which are to be made available for sale or let to a new tenant on or after 1 September 2016, will be affected.

What commercial buildings are exempt from the new regulations?

Any existing exempted buildings will continue to be exempt, e.g. a temporary building to be used for 2 years or less or a place of worship or a building due to be demolished. If a building was constructed in accordance with a building warrant applied for under the 2002 Scottish building regulations (or where the building otherwise meets those same required energy standards), it will be exempt from the requirement to exhibit an Action Plan to a prospective purchaser or tenant.

Do the recommendations need to be carried out by an owner and if so, within what timescale?

The owner of the building has 42 months (three and a half years) from the date of issue of the first Action Plan for the building, to complete any such improvement works. This time period takes into consideration the timescales for both obtaining any statutory consents for the works and also then completing the works themselves within the duration of a building warrant. If a building is occupied, this will allow the owner an opportunity to tie in any such improvements works with any ongoing maintenance programmes for the property.

Alternatively, the regulations permit a building owner to defer the completion of any such improvement works, provided that the owner carries out a reporting of the annual energy use of the building, commencing no later than 12 months from the date of the first Action Plan for the building. This reporting mechanism is also carried out by an EPC assessor and each of these EPC documents will then be publicly available on the EPC register online and should also be displayed within the building in question at all times.

What if the property is sold? Who is then responsible for any improvement works?

Where a building is sold, the ongoing responsibility to improve or report passes to the new owner. As with all EPC regulations, the penalty charge from the local authority for non-compliance is £1,000, for each failure to comply with the regulations.

If you have any queries regarding the new EPC regulations and how your property is affected, please contact Craig Smith, Associate on 01383 745776 or cjs@businesslaw.co.uk.

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