In a surprising reversal, Prime Minister Rishi Sunak has scrapped plans that require landlords to upgrade rental properties to meet minimum energy efficiency standards. The policy, known as MEES (Minimum Energy Efficiency Standards), would have mandated that all rentals reach an Energy Performance Certificate rating of C or above by 2025-2028.
The decision has elicited mixed reactions across the housing sector. Many landlords are breathing a sigh of relief, having pushed back against the costly upgrades they would have to make under MEES. But environmental groups are sounding the alarm, arguing that abandoning the policy undermines Britain’s net zero emission goals and leaves tenants at risk of rising energy bills.
The implications of Sunak’s about-face are significant for the rental market. Without MEES pushing change, the pace of efficiency improvements will likely slow. Tenants may remain in draughty, inefficient homes that are more expensive to heat. And it may prove harder for the UK to hit its climate targets.
Looking ahead, landlords weighing greener upgrades still have reasons to act – lower overhead costs, appeal to eco-minded renters. But the government’s eco policy flip-flop creates uncertainty around what standards they ultimately face.
In this article, we will explore the implications of Sunak’s U-turn on eco policies for landlords in more detail. We’ll discuss the potential impact of the reversal on energy efficiency in the rental market, and provide advice to landlords on how to improve the energy efficiency of their properties.
What was the MEES policy?
The MEES policy was introduced in 2015 and required private landlords to upgrade their properties to an Energy Performance Certificate (EPC) rating of E or above by 2025 or 2028, depending on the type of tenancy.
It was intended to improve the energy efficiency of the rental sector and reduce fuel poverty, defined as a household that is unable to afford to heat their home to a comfortable temperature. With rising energy costs, it’s a serious problem that thousands of homes face at the moment. The MEES policy was initially phased in, with landlords of new tenancies required to comply from 2018 and landlords of existing tenancies required to comply from 2020.
The policy applied to all private rented properties in England and Wales, with some exceptions. For example, the policy didn’t apply to listed buildings, those in a state of disrepair or properties where the cost of making energy efficiency improvements was prohibitive.
The MEES policy was controversial when it was first raised, with some landlords arguing that it was too expensive and would lead to higher rents. However, the government argued that the policy was necessary to improve the energy efficiency of the rental sector and reduce fuel poverty.
So the government recently announcing that it would be reversing the MEES policy has been met with mixed reactions. Environmental groups argue that it would undermine the UK’s net zero targets and lead to higher energy bills for tenants. While some landlords have already made changes in advance of the policy and ultimately could have saved money.
The reversal of the MEES policy is a significant setback for energy efficiency in the rental market. However, landlords can still choose to invest in energy efficiency improvements, even without the MEES policy in place. There are a number of benefits to doing so, including reduced energy bills, more attractive properties, and increased property value.
The benefits of an eco-friendly rental
Making rental properties more environmentally sustainable can have many benefits for landlords. Installing energy efficient appliances and lighting reduces utility bills, saving tenants money while also making the property more attractive. Low-flow toilets and showerheads conserve water and lower water bills.
Strategic upgrades like additional insulation, energy efficient windows and rooftop solar panels can drastically reduce a building’s carbon footprint and energy costs. For long-term landlords, these upgrades pay for themselves over time. Many tenants, especially younger generations, also actively seek out eco-friendly living spaces. A greener rental property can provide a marketing advantage and allow landlords to charge higher rents.
Additionally, regulations on building emissions are also becoming stricter over time. Proactively making a rental property more sustainable now will prevent larger expenses down the road. While the government’s policy on eco properties may be overturned now, there’s no knowing what the future holds and there is the likelihood that a similar policy will be introduced in the future, as the UK works to reduce its carbon emissions.
Creating an energy efficient and environmentally friendly rental space benefits a landlord’s bottom line while satisfying tenant demand and staying ahead of shifting regulations around building emissions and energy use. With smart upgrades and features, landlords can save money and attract tenants who value living green.
What does the U-turn mean for energy efficiency in the rental market
The reversal of the MEES policy is likely to have a negative impact on energy efficiency in the rental market. Landlords are now no longer legally required to improve the energy efficiency of their properties, and so there is a risk that fewer landlords will choose to invest in such improvements.
This is particularly concerning given that the rental sector accounts for a significant proportion of the UK’s housing stock. According to the English Housing Survey, 19% of households in England live in privately rented accommodation.
There are a number of factors that may influence landlords’ decisions to invest in energy efficiency improvements. One key factor is the cost of such improvements. Energy efficiency measures such as insulation and double glazing can be expensive to install, and landlords may be reluctant to make such investments if they are not confident that they will be able to recoup the costs through higher rents.
Another important factor is the availability of government support. The government offers a number of incentives to help landlords improve the energy efficiency of their properties, which can help to reduce costs. However, these incentives may not be sufficient to offset the costs of energy efficiency improvements for all landlords.
The reversal of the MEES policy is also likely to make it more difficult for the UK to achieve its net zero targets. The UK government has committed to achieving net zero greenhouse gas emissions by 2050. However, this will require significant reductions in energy consumption across all sectors, including the housing sector.
The rental sector plays an important role in the UK’s housing market, and the reversal of the MEES policy is a significant setback for efforts to improve energy efficiency in the sector. It is important for the government to continue to provide financial support to landlords to help them make energy efficiency improvements, and to develop other policies to encourage landlords to invest in energy efficiency.
What landlords should prioritise moving forward
Despite the current MEES reversal, there are a number of things that landlords can do to improve the energy efficiency of their properties. The first thing landlords should do is have a schedule of condition report carried out. A schedule of condition can be useful for landlords who are considering making energy efficiency improvements to their rental properties because it records the condition of a property at a specific point in time. It can be used to identify any existing damage to the property, as well as any potential areas for energy efficiency improvements.
Another key step which relates to this report is to get an EPC for each property in their portfolio. This will give landlords a good understanding of the energy efficiency performance of each property and identify any areas where improvements can be made. Landlords can then make a number of energy efficiency improvements, such as:
Insulating lofts and walls.
Insulating a rental property can make a huge difference in energy efficiency by preventing heat loss during colder months. Start by adding ample insulation to the loft space, which is vulnerable to drafts and heat escape through the roof. Use insulation materials like mineral wool, cellulose or fibreglass which have optimal thermal properties to resist heat transfer. Loft insulation should be 27 cm (10 inches) thick or more to provide adequate coverage.
For walls, there are a couple options depending on the construction. For cavity walls with a space between interior and exterior walls, inject insulation foam or loose wool into the cavities to create a thermal barrier. For solid walls without space to fill, install rigid insulation boards either on the interior wall surface or exterior, underneath the siding. This is more labour intensive but equally effective.
Installing double glazing
One impactful upgrade landlords can make is replacing single pane windows with new double glazed ones, which provide extra insulation for the building. Ideally, look for double glazed windows with low-emissivity coatings on the glass to help reflect heat back into the room during colder months. Make sure the space between the two panes has thermal breaks (spacers made of insulation material rather than metal, which prevent condensation from forming and leading to foggy window panes).
Carefully choose the frame material as well, since this affects energy efficiency. PVC window frames have thermal properties that prevent conduction. Wood frames should have insulated vinyl or rubber weatherstripping. Composite materials like fibreglass, wood and vinyl mixed together also resist heat flow.
Upgrading boilers and heating systems
Old, outdated boilers and heating systems can be incredibly inefficient, resulting in wasted energy and higher utility bills. One impactful upgrade is to switch to a modern condensing boiler, which reuses heat from combustion gases rather than letting that warmth escape up the flue. Condensing boilers use less fuel to generate heat, reducing costs. Install thermostatic radiator valves as well to allow control over the temperature of each room, rather than heating the whole building to the same temperature. This prevents overheating unused spaces.
For even more efficiency, consider renewable heating systems like heat pumps. Air source heat pumps extract latent heat from the outside air, even on cold days, and concentrate it to warm the interior. Ground source heat pumps circulate fluid underground to transfer warmth from the earth and into the building’s heating system. Water source heat pumps do the same via nearby bodies of water. While the upfront investment may be higher, heat pumps can dramatically reduce heating costs over the long term. With smart upgrades to boilers and heating systems, landlords can cut energy usage while keeping tenants comfortably warm in the winter.
Block draughts around doors, windows, fireplaces, lofts and floorboards using draught excluder strips, flexible silicone seals, chimney balloons and insulation covers. This prevents heated air from escaping and reduces energy bills. It’s a quick and affordable way to improve the EPC rating of a property without much time or financial investment required.
Installing energy-efficient light bulbs and appliances
Replace traditional bulbs with LED lights which use at least 75% less energy. Install energy-saving appliances like washing machines, dishwashers and fridges with high EU energy rating labels. Smart plugs can also reduce standby power consumption.
Landlords should also provide their tenants with advice on how to save energy in their homes. This could include things like turning down the thermostat, switching off lights when they leave a room, and drying clothes outside instead of using a tumble dryer.
The reversal of the MEES policy is a significant setback for energy efficiency in the rental market. However, there are a number of things that landlords can do to improve the energy efficiency of their properties, even without the MEES policy in place. Landlords should take advantage of any incentives available to them and make energy efficiency a top priority, irrespective of what the government puts in place in terms of regulations.
It’s worth noting that landlords should also consider the ethical implications of their decisions. By investing in energy efficiency, landlords can help to reduce their tenants’ energy bills, which is especially important during a time of rising energy prices. It’s such a positive move for both landlords and tenants, regardless of changing political decision making, and is also important for the UK to achieve its net zero targets.