Landlords-energy efficiency assessments

Landlords! Are you prepared for the introduction of energy efficiency assessments and certificates?

October 1, 2008 -- mark this date in your diaries, for this is the date on which Energy Performance Certificates (EPCs) become a legal requirement for rental properties in England and Wales - apart from it being the second day Rosh HaShana. Any new tenancies, by law must be accompanied by an EPC as evidence of the property's energy efficiency rating. If you have a high turnover of tenants you need to act NOW, otherwise you may fall foul of the law should you attempt to rent out your property after October 1st without an EPC.

What are EPCs?
An Energy Performance Certificate is a document that states how energy-efficient your property is and how much of an impact it is having on the environment. The certificate is set out in a similar design to the energy efficiency labels that are found on kitchen appliances, ranking your property on a scale from A to G, 'A' being the best efficiency rating; 'G' being the worst.

Naturally, the higher your property's energy efficiency rating is, the lower its running costs are going to be… and the more attractive that property might become for prospective tenants, some of who would be willing to pay a premium for lower-cost living.


The certificate will also state the property's current running costs for hot water, heating and lighting, so allowing prospective tenants to assess how much it will cost them to live at the property. Furthermore, an EPC may mention Recommendations, divided into three levels: Lower cost measures - low outlay and faster return, Higher cost measures - higher outlay but slower returns and Further measures - financial rewards are elusive; you would only do it for the sake of getting more points on your EPC. Each level will list items that will improve your property's performance ratings.

How to obtain an EPC

To obtain an Energy Performance Certificate you MUST have your property inspected by a Domestic Energy Assessor (DEA). As landlord you can either arrange for a DEA to visit your property, or you can have your letting / managing agent make the arrangements for you.

When DEAs make their inspection they will look at and measure the energy performance of key components in your property. This includes your property's insulation, the performance of your boiler, and how well the property distributes and retains heat in general. Your EPC will be issued within a short time, mostly within a few days of the DEA's assessment.

Improving the energy efficiency of your property

There are several ways to improve the energy efficiency of your property ahead of an inspection. The simplest and cheapest option is to 'beef-up' your loft insulation. By increasing the depth of insulation to 270mm you'll lower your property's running costs and score a higher rating on the DEA's assessment. Other steps you can take include: installing cavity wall insulation or double glazing, fitting a thermal jacket to your hot water tank, servicing your boiler or fitting Draught excluders on doors and windows.

Although the improvements suggested above might cost more than the potential savings in the first year - it could well benefit your investment in the long run. Apart from offering your would-be tenants lower bills (which will not change your own bottom line the least) still the improvements will go a long way to increase the price tag of your property.