EPC for landlords: how can I improve the EPC rating?

by Gordon Campbell

3rd November 2021

In our blog last week, How Can Landlords Help Combat Climate Change (click link to open), and the response and replies was huge with encouragement, thoughts and looking for more information.

The purpose of the blog, as they all are, was to encourage thought and debate. And it did.

It was our most ever read blog! Thank you as always for your input.

This is a follow up blog with some background to what is currently done, what can be done and what may lay ahead on how EPC ratings can be improved in properties.

As the eyes of the world are on Glasgow for the next two weeks for the 26th UN Climate Change Conference of the Parties (COP26), world leaders, dignitaries, climate change experts and campaigners from all over the world meet to tackle the urgent threat of global climate change.

We play our own part in making changes in our daily lives to try and make a difference: electric/hybrid cars, the food we eat, packaging, recycling, less materialistic consumption for example, but as landlords we can also contribute where we can, mainly on the EPC levels of properties.

Background:

In Scotland, housing is a devolved power from Westminster in London and the rest of the UK, e.g. Scotland controls its own legislation in housing.

That is a good think in my opinion as a landlord, as the housing and property regulation is far more robust -in a good way- in Scotland than the rest of the UK.

That was highlighted in our recent blog What is The Difference In The Property Market Between Scotland and England?

As a result, the way properties are built, bought, maintained, the standards they need to be kept to internally and externally, lived in and managed by factors/building management companies and letting agents, makes then less liable to issues internally and externally.

That is also why the EPC levels, generally, are better in Scotland.

What is an EPC certificate?

An EPC (Energy Performance Certificates) is a report that assesses the energy efficiency of properties and recommends specific ways in which it can be improved.

It gives your property a colour-coded grade (A – G) that gives would-be renters (or potentially buyers) an idea of how much energy bills will cost.

EPCs were introduced in 2008 to improve the baseline standard in the UK.

Where do I get my EPC?

In Scotland, the EPC is supplied as part of the Home Report for the property you buy.

Any properties bought from Alliance Property Group, we always ensure you get a Home Report before any property is purchased to ensure all is in order with the property internally and externally.

How is your EPC calculated?

Your property’s EPC rating is based on:

• The amount of energy used per m²
• The level of carbon dioxide emissions (given in tonnes per year).
  
  

Why are there two ratings on my EPC?

Your EPC rating includes your current rating as well as the potential energy efficiency rating.

This is an estimation of the EPC rating you might achieve if you were to make energy efficiency improvements.

How long does my property’s EPC rating last?

Once issued, your EPC is valid for 10 years – if your EPC is older than 10 years, you’ll need a new one issued before you can sell or rent your house.

Does my property need to meet a minimum EPC rating?

This legislation relates to Scotland.

Scottish Government has intended for some time to introduce regulations requiring private rented sector properties to meet a minimum energy performance certificate (EPC) rating before they can be let to tenants.

Previous proposals to require a standard of D from 2022 will now not be taken forward in recognition of the significant impact on the sector caused by the Covid-19 pandemic.

Instead, the government intends to introduce a requirement for PRS properties to have an EPC rating of C at change of tenancy from 2025.

All PRS properties will then be required to reach a minimum standard of C by 2028.

Exemptions will be available for properties where it is not technically feasible or cost effective to reach that standard.

The government intends to consult during 2022 on requiring all properties in Scotland, regardless of tenure, to meet an EPC standard of C, together with a proposed all-tenure zero emissions heat standard and any legislation needed to underpin this.

What are the benefits to landlords of renting out an energy-efficient property?

Even if you’re not living in the property, you can benefit financially from keeping it as energy efficient as possible. 

Here are three great reasons to stop those draughts:

1. If you look after the energy efficiency of your property, it can increase the value and desirability of it, which means you’re more likely to have it occupied, more of the time.
   
   
2. Warmer homes and cheaper energy bills mean happier tenants. Because they’re not forking out on huge monthly bills, they have more disposable income – this also makes rent arrears less likely, saving you a headache.

3. If you have energy efficiency measures in place, you’ll have lower maintenance bills and call-outs because you’ve reduced the likelihood of condensation and freezing pipes for example – all big hassles for landlords.

Top 10 Ways to Improve the EPC and Energy Efficiency

1. Top up the loft insulation:

this is one of the easiest and cheapest ways to improve the EPC rating.

Going from no insulation to 270mm can improve the rating by 10 or 15 points, whilst even a top up on existing insulation can get 2-5 points worth of improvement in many cases.

2. Cavity wall insulation:

If the building have cavity walls, make sure they are insulated.

Insulating a cavity can improve the rating by 5-10 points on average.

3. Upgrade the heating system:

Fit a more efficient boiler; older boilers can be less than 70% efficient whereas modern condensing boilers are over 90% efficient.

Boilers account for about 55% of what occupants spend in a year on energy bills, so an efficient boiler makes a big difference.

Modern Electric Storage Heaters

(i) Fan assisted storage heaters – fan storage heaters are smaller, better insulated and more responsive than traditional storage heaters.

(ii) High heat retention electric storage heaters - these retain more heat than other models and claim to be 27% cheaper to run than comparable static storage heaters.

Modern storage heaters should also incorporate better controls than traditional models. For example, there is usually a thermostat so that the heater switches off when it has reached a certain temperature. Many models also have automatic charge controls which will control how much heat they store overnight depending on the heater's internal thermostat as well as changes in daily weather patterns.

4. Insulate the hot water cylinder:

Not everyone has a hot water cylinder, but if it is worth adding insulation to the tank.

This is cheap and easy to do and will bump your rating by a few points as well.

5. Glazing:

If the property has single glazed windows, upgrading to new double glazing will make several points difference on average.

Any properties that we refurbish that initially have single glazing when the property is purchased are always replaced with double glazing.

6. Seal open chimneys:

Open fires and draughty chimneys make some difference to the EPC rating.

If possible, these should be blocked up permanently.

7. Fit low energy lightbulbs:

Although low energy lightbulbs will only make a small difference to the EPC rating, they are cheap and easy to fit and suitable for all properties so are worth doing, especially if the property is on the threshold between two EPC ratings.

8. Draught proofing:

Adding draught proofing and changing the lights over to energy efficient versions can add about a point each onto the final rating.

Not much, but they don’t cost much to do!

9. Install a smart meter

Although the Government has failed in its goal to get a smart meter in every UK home by 2020, and there are certain issues involved with them, they are a good way of telling your tenants how much energy they are using and modifying their behaviours accordingly to become less wasteful and reduce their energy bills.

10. Renewables:

Not always a feasible and practical solution for rented properties to be done by the landlord, but is one for the Factors/Building Management companies (in Scotland) .

Adding solar PV should boost your rating, dependent on the size of the system being installed.

With larger 16 panel systems, it could add 10 points to the rating.

Solar thermal, although usually a bit cheaper than a PV system, will only add a few points to the rating.

Wind turbines can also improve the rating, but this is only going to make a difference for larger turbines in rural areas.

Small urban turbines have little impact, both in the EPC and in your electricity supply!

Further advice

Please note that the EPC recommendations report is NOT a reliable tool to use to work out what improvements to do to get to a particular EPC rating.

Summary:

We hope this blog helps with some further thought and ideas on how you and we can all help in helping to combat climate change, improved the energy efficiencies in our homes and investment properties, while helping the tenants.

Also- important:

Most of the properties that Alliance Property Group sell are in Glasgow and surrounding areas and are apartments/flats.

The EPC levels are meeting current standards.

Any refurbishment that we do on any properties that you buy from us, will not only meet the correct standard of refurbishment required but also continue to take into consideration in how the EPC level can be improved by us e.g., double glazed windows, lighting, insulating water tanks etc.

That will all be detailed in the refurbishment quotes we provide so no doubt on the cost and work required.

We will continue to review what is currently done, the forthcoming requirements in the years to come and respond.

Lastly, the building management/Factors in Scotland who look after and maintain the external and internal of the buildings will continue to play their part and step up as well with further and continued improvements, e.g., loft insulation, communal lighting upgrades, renewable solutions, charging points for electric vehicles.

Thank you for reading.

And remember…

If you have any questions or are looking for some advice, please don’t hesitate to get in touch. 

Gordon and James

Alliance Property Group. Making a Difference