Energy Performance Certificates
Current Energy Performance Regulations for non-domestic properties provide that when a building is sold or rented out the Seller or Landlord must provide the prospective buyer or tenant with a valid Energy Performance Certificate (EPC) and a recommendations report free of charge at the earliest opportunity.
Duration of an Energy Performance Certificate
Once obtained an EPC is valid for 10 years from the date of issue.
Energy Performance Certificates for Leasehold Properties
For rented properties the following aspects will require consideration:
- Does the landlord want to prohibit the tenant from commissioning any further EPC reports to avoid the risk of the original certificate being invalidated?
- Can the landlord reclaim the cost of providing the EPC through the service charge? The cost of an EPC obtained prior to grant of the lease must be provided free of charge but further certificates obtained by the Landlord during the term could be charged to the tenant through the Service Charge.
- Can the landlord reclaim the cost of carrying out the recommendations set out in the report which accompanies the EPC (which are non-compulsory) through the service charge?
- If the EPC shows the property to be very energy efficient will the landlord want this to be taken into account on rent review?
- If the lease permits alterations the landlord may wish to limit these to works “which do not adversely affect the asset rating in any EPC commissioned in respect of the property”?
- Will the landlord allow the tenant to copy the EPC to prospective assignees?
- It should also be noted that works any works which sub- divide a property or its heating, hot water systems etc could trigger an obligation to provide a further EPC
If you wish to discuss this article or require any advice or assistance in relation to commercial leases then please do not hesitate to contact Jonathan Senior on 0114 2536543.