Heat in Buildings Bill – Potential impact on privately let residential properties in Scotland
Anyone involved in Scottish residential property management has been growing increasingly frustrated by the limited information available around the reform of Energy Performance Certificates (EPCs) in Scotland.
Initial legislation was drafted in 2019 but binned in 2021 due to Covid, and since then landlords and property managers have been left in limbo, knowing that changes to the minimum standard are coming but not knowing when they might come into force or what they might involve.
However, more detail emerged this week when the Scottish Government opened the consultation on the proposals for Heat in Buildings Bill.
This consultation confirms that the Government plans to require private landlords to meet a minimum energy efficiency standard by the end of 2028, and by the end of 2033 owner occupied homes will also need to meet a minimum energy efficiency standards.
So, what will the minimum energy efficiency standard be?
For years now, it has been known that a minimum EPC score is incoming but there has been a lack of clarity on how this might be achieved, and if there are going to be any exclusions or if there is going to be a price cap.
This new consultation proposes that minimum energy efficiency standards can be met by installing a straightforward list of measures. This list would be developed to ensure the biggest impact with the lowest degree of cost and disruption. It is important to note that the consultation says:
“Any homeowner who had installed these measures – or as many of them as are feasible for the type of home they live in – would be considered to have reached a good level of energy efficiency and meet the new standard.”
This is reassuring as it confirms that not all proposed measures will need to be met in every single property. The consultation suggests that the list could be:
270mm loft insulation
Cavity wall insulation
80mm hot water cylinder insulation
Suspended floor insulation
Many landlords and homeowners will have made energy improvements to their properties already; therefore this consultation proposes that alongside the above measures, there could be an alternative option of meeting these standards based on the result of an EPC assessment.
It is proposed that owner occupied homes that have ended their use of polluting heating, gas or oil for example, by 2033 will not be required to meet the minimum energy efficiency standard. However, private rented properties would still be required to meet the minimum energy efficiency standard, even if a clean heating system is already in place.
Finally, there is a hint of clarification around the consequences to landlords if their properties do not meet a minimum energy efficiency standard. The consultation proposes that properties in the private rented sector which do not meet these standards by the end of 2028 would not be allowed to be leased to a new tenant should the existing tenant leave.
The consultation on the proposals for Heat in Buildings Bill began on 28th November 2023, and is due to close on 8th March 2024.
The consultation can be read in full here.
Please contact Bell Ingram’s Rural Land Management team on 01738 621 121 if you have any questions and would like to discuss how this may impact your properties.
Tel: 01463 717 799
About: Hamish is an experienced RICS Chartered Surveyor and Registered Valuer, working across the Highlands with a focus on rural estate management from traditional sporting estates to diversifications. He is a graduate of Edinburgh Napier University with MSc Real Estate Management and Investment. Interests: Estate Management, Sales & Lettings, Valuations, Domestic Energy Assessments.