In this post, we cover the new Minimum Energy Efficiency Standards, including:
- What is MEES?
- What is changing to the existing MEES regulations
- How this affects you if you do not meet the standards
- Futureproofing your properties
- Future iterations that are coming
In 2018, the Minimum Energy Efficiency Standards (MEES) were introduced in the UK. This was introduced to address the issue of carbon emissions from non-domestic buildings. The regulations made it mandatory for landlords to ensure their properties meet a minimum energy efficiency rating of E. This was specifically when granting new leases. Failure to comply with these regulations can lead to penalties and legal action.
The MEES regulations have been effective in improving the energy efficiency of non-domestic buildings in the UK. However, with the growing need for sustainability and carbon neutrality, the government has decided to extend the range of the minimum energy efficiency standards in 2023. From April 2023, regulations will be extended to ALL commercial properties. Existing leases will not be able to be renewed without a minimum energy efficiency rating of E.
This change means that landlords will need to invest in energy-efficient technologies and upgrade their properties to meet the new standards. While this may seem like an additional cost, it is an opportunity for landlords to future-proof their properties and make them more attractive to tenants.
In a recent survey, less than 1/3rd of the property decision-makers admitted they do not know their office’s EPC rating. This is shocking given the new regulations. However, this does give an advantage to commercial property owners that do know and make upgrades.
One way commercial landlords can future-proof their properties is by incorporating technology that enhances energy efficiency. Smart HVAC systems, motion sensors, and energy-efficient lighting are just a few examples of technologies that can be used to improve energy efficiency. These technologies not only reduce carbon emissions but also lower energy bills for tenants, making your properties more desirable.
82% of FTSE 100 companies have now committed to achieving ‘Net Zero’ emissions by 2050
according to research by Boodle Hatfield, a leading private wealth law firm
If you fail to meet the new MEES standards, you risk losing tenants who are increasingly demanding energy-efficient buildings. This is especially true for businesses that have made commitments to sustainability and carbon neutrality. 82% of FTSE 100 companies have now committed to achieving ‘Net Zero’ emissions by 2050*. Upgrading your commercial properties now will see significant returns from reduced energy costs, higher rents and reduced churn. Higher sustainability standards will see you leading the race to attract new tenants who prioritise sustainability. Office buildings with poor energy efficiency ratings are having to lower advertised rents by as much as 10% to attract tenants**.
Future iterations of the MEES regulations may require landlords to implement more advanced technology in their properties. For example, the use of renewable energy sources such as solar panels or wind turbines may become mandatory. Landlords who invest in these technologies now will be ahead of the game and better equipped to meet future standards.
The new Minimum Energy Efficiency Standards set to take effect in 2023 are an opportunity for you to future-proof your properties. Eventually, many of these regulation changes will become the default for all commercial property owners. Improving your energy efficiency credentials will give you an advantage in the market now. Future iterations of the MEES regulations will become more demanding. Landlords who embrace energy-efficient technologies now will be better equipped to meet future standards and stay ahead of the curve.
Bear in mind that in 2025, regulations will change again. There will be new requirements to hit a minimum energy efficiency rating of D. In 2027 the minimum will be a C rating, and eventually, by 2030 you’ll require a MEES of B.
If you have any questions about the most effective ways to improve your energy efficiency with the lowest CapEx, get in touch today. We can show real-world examples of buildings that have transformed their MEES from E to A using just software solutions.
*according to research by Boodle Hatfield, a leading private wealth law firm
**according to recent figures from property adviser, Carter Jonas.