The Scottish Government has released their response/outcome to the Energy Performance Certificate (EPC) Reform consultation, a consultation originally put to industry back in 2023. The document confirms the planned introduction of new ratings, a redesign to the certificate and a reduction in the validity period, which are all due to be introduced in line with the release of the Home Energy Model (due in 2026).

Domestic EPC Ratings

The Scottish Government proposed revisions to the current information displayed on Domestic EPCs. These revisions looked at expanding the current ratings as well as renaming them to make them clearer. As a result they proposed 3 headline metrics which included a:

• Fabric Energy Efficiency Rating
• Heating System Type Rating
• Cost Rating

In addition to this, and similar to the recent EPC Reform consultation in England and Wales, the Scottish Government were also proposing to introduce secondary metrics in the form of an ‘Emissions Ratings’ and ‘Energy Indicator’.

However, the feedback from the industry regarding the above metrics was generally unfavourable, and with that, the Scottish Government has confirmed its intentions to introduce the following metrics to Domestic EPCs in 2026:

Heat Retention Rating,

The Heat Retention Rating, will provide information on the fabric energy efficiency of the home – i.e. how well insulated it is.  The rating is based on the modelled energy required to heat the dwelling to set temperature conditions (in kWh/m2/year) This rating will be shown on an A to G rating scale showing a current and potential rating, equivalent to what is shown on the current EPC as a cost-based Energy Efficiency Rating.

A property with a Heat Retention Rating of 30 kWh/m²/year or lower would be considered highly energy-efficient, corresponding to an EPC Rating of A. On the other hand, a property with a Heat Retention Rating of 351 kWh/m²/year or higher would be deemed inefficient, resulting in an EPC Rating of G.

Initial research from Scottish Government suggested that the majority of homes currently with an EPC Energy Efficiency Rating of C would also achieve a Heat Retention Rating of C, with 15% moving to a better rating and 10% moving to a lower rating.

Heating System Rating

The Heating System Rating will provide an indication of a heating system’s current performance, as well as potential for improvements, based on three different criteria:

• Emissions Category– rates the type of system in respect of its emissions from clean to polluting.
• Running costs– The performance of the system in terms of how much it costs to run will be shown on an A to G scale. This will reflect how much it currently costs to use the system to heat the home to standardised conditions
• Thermal Efficiency– How effective the heating system is at using fuel or energy to produce heat, shown on an A to G scale.

Energy Cost Rating

The Energy Cost Rating is simply a rebranding of the current Energy Efficiency Rating (EPC or SAP rating) showing how changes to the heating system or fabric affect the cost of running the home . This will once again be delivered on an A to G scale, with a current and potential rating still in place.

Non-Domestic EPC Ratings

The Scottish Government also proposed revisions to the information displayed on Non-Domestic EPCs. They noted that a key concern raised by responders was that current Scottish non-domestic EPC ratings do not align with those used across the rest of the UK, potentially making this confusing for the general public. They also emphasised that Domestic and Non-Domestic buildings are not comparable, and continuity across ratings is not possible due to the “differing contexts” of each sector.

In light of this, a reformed set of metrics that focus on the direct emissions of Non-Domestic buildings were proposed. Although only about one-third of respondents agreed with these ratings, the Scottish Government has decided to proceed with the proposed metrics, which are as follows:

• The Energy Efficiency Rating, shown on an A to G scale and will follow the same rating scale as the Asset Rating used on non-domestic EPCs across England, Wales and Northern Ireland, allowing it to be used interchangeably across the UK.
• The Direct Emissions Rating which will provide further information on a buildings direct emissions
• The Energy Demand Rating which will provide information about the regulated energy use of the building and provide a point of comparison against other buildings.

The Primary Energy Rating will remain as part of the non-Domestic EPC as this allows comparison with other buildings across the EU.

Validity Period to be reduced to 5 Years

In a positive development, Scottish Government have confirmed that the validity period of EPCs for both domestic and non-domestic buildings will be reduced to 5 years. This is to ensure that consumers have up-to-date and relevant information when looking to purchase, rent, or make improvements to their property.

In our response to this consultation, Elmhurst emphasised that the EPC should be re-assessed and re-issued whenever there is a change to a building that impacts its energy performance. We also believe and EPC should never be older than three years to maintain the relevance of estimates and recommendations, however the reduction in validity period to 5 years is welcome step forward.

A Digital EPC

Aligning with England, Wales and Northern Ireland, Scottish Government will be looking to move EPCs to a digital format away from PDFs. This is intended to make it easier for the general public to access and understand. They will be considering how best to adopt the redesign outlined above in a webpage format as part of upgrades to the Scotland EPC Register. A printable version of the certificate will still be available if required.

With the move to an online EPC, the Scottish Government has also commissioned research to scope out potential content for a new dynamic EPC user interface, which would allow consumers to input different variables in terms of how they behave in or use their property, to understand the likely impact that this would have on their energy use.

Quality Assurance Changes

The Scottish Government, like Elmhurst, is committed to ensuring that assessments are conducted to the highest standard, with confidence in the expertise and qualifications of trained and accredited energy assessors.

The Scottish Government intends to collaborate with organisations such as Elmhurst, which train and accredit energy assessors, to enhance the system and ensure that assessors are properly trained and qualified. Moreover, they plan to introduce more robust auditing methods which could include the introduction of ‘smart’ auditing which is already used in England and Wales, and even independent onsite inspection.

The ultimate goal is to ensure that the EPC is regarded as a trustworthy document, one that property owners can have full confidence in.

Elmhurst’s Managing Director, Stuart Fairlie, comments on the Scottish Government’s response and what this could mean for the industry:

Elmhurst is encouraged to see the Scottish Government taking a leading role in updating and improving the EPC system in Scotland. The introduction of new metrics should help demystify the EPC for most consumers, enabling them to better understand how their property performs across a range of areas. Additionally, the reduction in the EPC validity period is a welcome change for the industry, as it could lead to more frequent assessments, offering a clearer, up-to-date picture of the energy performance of Scotland’s building stock.

While these changes are a step in the right direction, the Scottish Government could have gone a bit further to make the new metrics easier for consumers to understand. Elmhurst has long called for the EPC to clearly display three key indicators: Carbon, Cost, and Energy Consumption, as these are vital for property owners and tenants. However, the way this information is due to be presented may still cause a little bit of confusion for the average consumer. 

It will be interesting to see the outcome of the EPC Reform consultation in England and Wales, as this could result in significantly different EPC documents depending on the region. We look forward to working closely with the Scottish Government to ensure the quality of assessors and the assessments they carry out. Strengthening the auditing process, particularly with on-site inspections, presents some challenges, but we are fully committed to collaborating with the Scottish Government to develop a pragmatic solution that works for all parties.

With changes to EPCs now on the horizon in Scotland, Elmhurst believes it is an ideal time for Scotland to move forward with additional regulation in the private rented sector, aligning it with similar regulations in England and Wales. This was first outlined in the 2021 Heat in Buildings Strategy Document, though progress has been slow since then. Discussions also suggested introducing similar regulations for owner-occupied homes by 2033. While we do not expect immediate, sweeping changes, such regulations have been effective in encouraging action on energy performance improvements, which will play a key role in helping Scotland meet its net-zero commitments.”

What happens next?

These new measures are planned to be implemented in line with the release of the new Home Energy Model, currently planned for release in the second half of 2026. Although this timeline could change, the Scottish Government believes the implementation alongside the Home Energy Model will reduce disruption and allow key stakeholders enough time to prepare.

Further Resources

• You can view the full Scottish Government response here: https://www.gov.scot/publications/epc-reform-consultation-government-response/
• You can view Elmhurst’s submitted response to this consultation here: https://www.elmhurstenergy.co.uk/app/uploads/2023/10/Consultation-Response-EPC-Reform-Scotland-Final.pdf