The UK Government is introducing stringent new energy efficiency standards for the private rented sector (PRS). By 2030, all privately rented properties must achieve an EPC rating of C or above, or hold a valid exemption, to be legally let to tenants.
In preparation for this major overhaul, the Government has launched an updated Exemptions Register, which will now operate through its central ‘One Login’ service. This update aims to streamline the process, making it easier for landlords to manage and, crucially, evidence their property exemptions.
Current EPC Exemptions (Under the ‘E’ Rating Minimum)
For properties currently falling below the existing ‘E’ rating standard, a legal exemption can be granted under specific circumstances. The current acceptable exemptions include:
- All Improvements Made: You have spent up to the £3,500 cost cap on all possible improvements, but the property still does not meet the required grade.
- High Cost: Even the cheapest recommended improvements exceed the £3,500 cap.
- Structural Damage: Wall insulation is recommended but an expert confirms it would damage the property’s structure.
- Devaluation: The required improvement works would reduce the property’s market value by 5% or more.
- Third-Party Refusal: Tenants, freeholders, mortgage providers, or planning authorities refuse to grant the necessary consent for the works.
- New Landlord Grace Period: A temporary, six-month exemption is available for new landlords to either upgrade the property or apply for a longer-term exemption.
What We Know About the Upcoming ‘Band C’ Exemptions
While we are still awaiting the full legislative details, the Government has confirmed key exemptions that will apply under the new EPC Band C regime:
- The £10,000 Cost Cap: Landlords will be able to register for an exemption if a property remains below a ‘C’ rating after £10,000 has been spent on energy efficiency improvements. Under current plans, this specific exemption will last for 10 years.
- Low Property Value Cap: For properties valued at under £100,000, the cost cap will be adjusted to 10% of the property’s value (rather than the flat £10,000). Once this lower cap is reached, you will be eligible for an exemption.
What Happens Next?
Note for EMPO Members: The Government has not yet confirmed whether further exemptions (such as third-party consent or structural issues) will be carried over or adapted for the 2030 rules.
We are monitoring the situation closely. As your local association, we will provide full breakdowns and guidance as soon as further official announcements are made. Please keep an eye on our email updates and follow our social media channels for real-time updates.