The Government has delivered on its September announcement by releasing a consultation on proposed changes to Minimum Energy Efficiency Standards (MEES), set to impact the private rented homes in England and Wales. This announcement forms part of the government’s wider Warm Homes Plan, which aims to upgrade 5 million homes across the country.

The key headline from the consultation is the uplifting of current minimum energy efficiency standards, from Energy Performance Certificate (EPC) rating E all the way to EPC Rating C or equivalent. The proposed date in which domestic landlords will need to achieve this by is 2030.

This proposal will expect to uplift 52% of private rented homes in England to a new EPC standard, whilst also saving tenants £240 per year (on average) on their energy bills.

Why is an Uplift to MEES required?

The Minimum Energy Efficiency Standards, or MEES for short, are regulations which establish a minimum EPC Rating, for domestic properties that are rented privately by landlords in England and Wales.

The current minimum standards have been in place since April 2018, preventing landlords of properties with an EPC rating of F or G from granting tenancies to new or existing tenants, as well as from continuing to let such properties, without a valid exemption.

Based on the government’s 2024 fuel poverty statistics, there remains a high rate of fuel poverty within the private rented sector, with 24% of these households deemed fuel poor (England Only). This represents approximately 1.1 million properties, which is twice the number of social housing properties deemed to be in the same condition. Improving the energy efficiency of a property will ensure less heating is needed, which in turn will reduce energy bills.

In addition to improving the quality of living for tenants, the government will also have its 2020 net zero targets in mind. In 2022, emissions from residential buildings accounted for 20% of total carbon emissions in the UK. The Climate Change Committee (CCC), has previously stated that the UK will struggle to meet its emissions targets “without near complete decarbonisation of the housing stock”.

What is being proposed?

A ‘Phased’ Timeline

The consultation proposes a phased approach to new standards, similar to what we saw when the original EPC standards were introduced to the private rented sector. This would see the requirement for ‘new tenancies’ to meet the higher standard from 2028, and ‘all tenancies’ to meet the higher standard by 2030.

Using new EPC Metrics

The government released a consultation to reform EPCs in January. A key change proposed for the EPC is how it appears to the end consumer. The current EPC appearance is recognisable from the colourful A to G rating scale presented at the top. For Domestic EPCs this simply represents the energy cost of a property – i.e. how cheap or expensive a home might be to run, based on a standard occupancy model.

Proposals made as part of this public consultation includes the introduction of a number of different metrics on EPCs to provide a more complete representation of building energy performance. With the introduction of new metrics likely to be in 2026, the government’s preferred approach is to require landlords to prioritise meeting a standard set against a fabric performance metric (the thermal performance of a building’s envelope), which the government believes is likely to require similar improvement measures as meeting an EPC C on current EPCs.

Following this landlords would then need to meet a secondary standard set against either the proposed heating system metric or the smart readiness metric. This could be determined by the landlord who would decide what is best for their property. The consultation states:

“This would enable the policy to deliver significant bill savings for tenants and improve the thermal comfort of privately rented homes, whilst also encouraging the decarbonisation of heating and improved flexibility in the energy use of buildings. Using new metrics in this way would mean landlords would be required to install measures that could improve the building’s heat retention, reduce the energy required to operate the building’s heating systems, and enable the occupier to optimise their energy use, to maximise the overall energy efficiency of the building and reduce its running costs.

However, government recognises that this is just one approach to utilising new metrics and this consultation seeks views on alternative approaches.”

Furthermore, properties that are already rated A-C before the proposed introduction of new EPCs in 2026 would be considered compliant until they expire. For properties that remain below EPC C following reforms to EPCs in 2026, it is proposed that landlords of these properties would be required to commission a new EPC before taking action to comply with the higher standard.

Increase of Cost Cap to £15,000

The government is proposing a big increase to the cost cap, from the current £3,500, to £15,000 per property. This means that the maximum amount landlords are required to invest in the property overall, to meet both the fabric performance standard, and either the smart readiness or heating system standard would by £15,000. The government currently estimates that it will take between £6,100 to £6,800 to improve a property to the required standard.

Landlords will still be able to register an exemption if the cost to improve their property would take them over the £15,000 cap. At present, this particular exemption would be valid for 5 years. However, the government is proposing to double the exemption period for the cost cap to 10 years.

The consultation also explores whether an alternative cost cap figure would be more appropriate. The original 2020 MEES consultation proposed a £10,000 cost cap at the time.

A Review of Exemptions

Existing regulations allow Landlords to register an exemption in order to remain compliant with MEES regulation, despite their property not meeting the required standards.  Based on the proposal, landlords will still have the facility to do this, however, the government is asking if they are still suitable and whether new ones should be introduced in light of the changes being proposed. The current exemptions include:

• ‘All relevant improvements made’ exemption
• High cost exemption
• Wall insulation exemption
• Third-party consent exemption
• Property devaluation exemption

The government is considering the introduction of a new affordability exemption, given the significant increase to the cost cap, which would reduce the required investment per property to £10,000 should the £15,000 cost cap be agreed. However, the government admits that designing a “fair and effective” affordability exemption is not simple, which is why it is seeking views on the best approach to this or whether, in fact, it should be introduced.

Increase to fines

Under the current regulations the maximum amount landlords can be fined for not complying with MEES is £5,000 per property. The government’s preferred position is that the fine level for future MEES standards is set at £30,000 per property, and per breach of the regulations.

Elmhurst’s Thoughts

Elmhurst’s Managing Director, Stuart Fairlie, is supportive of the progress being made in this area, and is keen to see long-term commitment so that there remains confidence for tenants and landlords alike:

“Tenants living in properties with an EPC rating of D to G are likely struggling with the cost of heating their homes, with some facing bills that are up to three times higher than those of a home rated EPC C. Now is the time for landlords to seriously assess the energy performance of their properties. Those with lower EPC ratings risk not only harming the health and wellbeing of their tenants but also diminishing their own property value over time if improvements are not made. 

We are pleased to see that action is now being taking in this area and to see some longer term commitment to raising the standard. This will ensure landlords have confidence to invest where necessary, with appropriate support and funding mechanisms and will also ensures that tenants can live in warmer, cheaper to run homes.

It is interesting to see the government’s approach to a heightend MEES- making use of the fabric performance metric, as well as secondary metrics alongside this. This may make it a bit complicated for landlords to understand, given they have been working from the EPC’s Energy Efficiency Rating under current regulations. With reforms to EPCs still under consultation, we may yet see these metrics change. 

However, a new look EPC will not only support the implementation of  new standards but will also help resolve concerns about the suitability of EPCs within MEES, particularly for properties facing challenging circumstances.

We would now strongly recommend that the government also looks at progressing MEES in the non-domestic sector alongside this, to ensure that ALL rented buildings can become more energy efficient.  The government had previously proposed raising the minimum EPC standard in the non-domestic private rented sector, from E to C for new tenancies by 2025 and for all tenancies by 2028. However, it remains unclear when and if these standards will be formally introduced to the industry”.

Elmhurst will be taking time to review the government’s consultation in full with the deadline to respond set as the 2nd May 2025.

Related Links:

Fuel Poverty Report 2024: https://www.gov.uk/government/statistics/annual-fuel-poverty-statistics-report-2024

Full Consultation: Improving the energy performance of privately rented homes: 2025 update – GOV.UK