Search

How can we help?

Icon

What does MEES mean? 

The Minimum Energy Efficiency Standards (MEES) are regulations intended to improve energy efficiency standards in both commercial and residential properties. Compliance with MEES is a legal requirement under the Energy Act 2011. This article will focus on the current MEES regime and how it relates to commercial properties in England and Wales alone. Properties in Scotland are subject to different conditions.  

Current Requirements Under MEES 

For commercial landlords, compliance with MEES is crucial if you want to rent out properties in England and Wales. Since 1 April 2018, landlords are required by law to grant leases in properties that have an Energy Performance Certificate (EPC) rating between A+ and E. Anything below (F and G ratings) means the property will be considered as sub-standard. By law, properties with sub-standard ratings cannot be rented out. 

From 1 April 2023, this legal obligation will extend to all existing leases granted out to tenants before 1 April 2018. For example, if a landlord granted 10-year lease in 2016 with a sub-standard EPC rating (F and G), they will be required under MEES to improve the EPC rating even if there is no change in the tenancy agreement (subject to qualifying for any exemptions).  

Exemptions Under MEES  

Properties with sub-standard EPC ratings can benefit from exemptions under MEES. Some exemptions include: 

  • All possible improvements have been made: landlords can rely on this exemption if they have carried out all relevant EPC improvements or cannot make any improvements to change the sub-standard rating of the property;  
  •  if a landlord has used all reasonable efforts to obtain consent and cannot gain such consent from any relevant third parties (such as the local authority) or the tenant to carry out the necessary EPC improvements;  
  • if a landlord has received a surveyor’s report which concludes that any improvements would devalue the property’s market value by 5%; 
  • if someone has just recently become a landlord, they can benefit from a temporary exemption as it will be unreasonable to expect the landlord to comply with MEES regulations instantly. This temporary exemption last for 6 months. 

The exemption come with complex and ongoing conditions: they last for 5 years and require registration on the PRS Exemptions Register. Furthermore, if an exemption expires, landlords must comply with EPC improvements under MEES or register a new exemption.  

By law, properties with sub-standard ratings cannot be rented out. 

Why Compliance is Important  

Failure to comply with MEES will attract penalties. Financial penalties can range from £5,000 to £150,000. For instance, a breach lasting less than 3 months will attract a fine of £5,000 while the maximum fine for a breach lasting more than 3 months is £150,000. Furthermore, any misleading information provided by landlords on the PRS Exemption Register can attract a £5,000 fine. Additionally, there will be publications about landlords who fail to comply with MEES. Such publication may lead to reputational damage.  

Enforcement however is very low, as it’s understood the relevant authorities do not have the resources available to police compliance. This could of course change if the government chooses to prioritise enforcement. With this in mind, landlords must take action now if they have not already to improve sub-standard EPC ratings before 1 April 2023. Furthermore, landlords should note that the government aims to raise minimum EPC standards in the future. As a result, all commercial properties will need to have an EPC rating of C or higher by April 2027 and a rating of B or higher by 2030.  

 

About this article

Disclaimer
This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full General Notices on our website.

About this article

Read, listen and watch our latest insights

art
  • 27 March 2024
  • Commercial Real Estate

5 key considerations when taking on a lease of a pub property

Taking on a pub property can be both exciting and daunting. Here are 5 key considerations that pub tenants should consider when taking on this new venture.

art
  • 28 February 2024
  • Commercial Real Estate

Hidden risks in serviced office agreements

This is usually a fully furnished and equipped office space that is managed by a facility management company and made available for short-term or long-term rentals to businesses, varying from one week to a year, or even longer.

art
  • 05 February 2024
  • Commercial Real Estate

What happens when a tenant serves a break notice ‘early’?

To exercise the break option, the tenant had to provide the landlord with at least six months’ notice, and in order for the notice to be valid, it must be served by special delivery or have receipt acknowledged by the landlord.

art
  • 01 February 2024
  • Commercial Real Estate

Can a tenant forfeit their own lease?

In the unusual case of NPS (40GP) Limited v Liberty Commodities Limited EWHC 2137 (Ch), a landlord had to dispute a claim by their tenant that their lease had been forfeited, after their key card access to the building had been revoked following routine maintenance.

art
  • 25 January 2024
  • Commercial Real Estate

Can the Local Authority force me to lease my commercial property?

This article explores the key aspects of the Levelling-up and Regeneration Act 2023 (LURA 2023) that may impact landlords in England.

art
  • 04 December 2023
  • Commercial Real Estate

Real Estate update and 2024 expectations

The ECC confers rights on code operators to install and maintain electronic communications apparatus on public land, and even grants operators the right to sometimes apply to court for an order allowing them to install and maintain such apparatus on private land.