Home / Making homes more efficient
18th June 2025
Stephanie Cairns, Associate
The Government has consulted on raising the minimum energy efficiency rating for rented residential properties, and most recently published a consultation on 7th February 2025. This consultation aligns with the Government’s ongoing reforms aimed at improving standards in the private rental market.
An Energy Performance Certificate, or EPC, is a report undertaken by an accredited assessor which gives a property an energy efficiency rating from A (best) to G (worst). It is a legal requirement to have an EPC when selling or renting a property, unless a specific exemption applies (for example certain listed properties, or properties intended to be used for less than four months per year). EPCs are valid for ten years from the date of issue.
Currently, minimum energy efficiency standards for residential property (MEES) require a minimum energy efficiency rating of E for privately rented residential properties in England and Wales.
The consultation proposes a new minimum energy efficiency rating of C for private rented properties, applicable to new tenancies from 2028, and existing tenancies from 2030. For some properties this will involve significant works, and therefore significant cost.
A raise to the spending cap for improvement works has been proposed to £15,000, which is a significant increase on the current cap of £3,500. An ‘affordability exemption’ has been suggested which would lower the cost cap to £10,000 for properties with lower rent, or in a lower council tax band.
There is a proposed ten-year exemption (currently five) if a landlord has spent this amount on improvements and the property still does not meet the minimum energy standard. Landlords wishing to take advantage of this exemption will need to register on the Private Rented Sector (PRS) Exemptions Register, and will be required to submit evidence of the costs incurred. It is not yet known if the Government intend to offer any financial assistance in paying for these works.
Short term lets are not currently included in the MEES, but the consultation proposed including these to avoid landlords switching their properties to holiday lets as a way around the changes.
The consultation closed on 2nd May 2025, and at the time of writing the outcome is awaited. It remains to be seen what the impact on the rental market will be as a result of the proposed changes but it is advisable for those looking to purchase rental properties to consider not only the current EPC rating of a property, but also the proposed rating, and the cost of getting there.
Landlords will also be keen to understand if the Government plan on making further changes in the future, requiring even higher minimum standards, in order that they can plan their business and finances accordingly.