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MEES Regulations: Exemptions and Penalties

The Minimum Energy Efficiency Standard (MEES) was introduced in March 2015 by the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015.
At present commercial buildings have an energy efficiency rating between A and G. Under the MEES Regulations, as of 1st April 2018 it will be unlawful for a landlord to renew an existing tenancy or grant a new tenancy of a property with an EPC rating of below an E rating unless an exemption is registered.

Important Dates

1st April 2018

When the MEES Regulations will come into force, meaning that it is unlawful for a landlord to renew an existing tenancy or grant a new tenancy of a property with an EPC rating of below an E rating unless an exemption is registered.

1st April 2020

From this date it will be unlawful for a Landlord to continue letting a domestic property with an EPC rating of below an E rating.

1st April 2023

From this date it will be unlawful for a Landlord to continue letting a non-domestic property with an EPC rating of below an E rating.

Exemptions

The MEES Regulations set out four exemptions that Landlords of sub-standard properties can register. Where one of the following exemptions applies and has been validly registered, the landlord will lawfully be able to let the property even though it is sub-standard.

  1. Consent – this exemption applies in situations where, despite reasonable endeavours, the Landlord is unable to obtain any necessary third party consent to carry out the required works to improve the EPC rating of the property. This exemption lasts for 5 years.
  2. Devaluation – this exemption applied to situations where the required works would devalue the property by more than 5% according to an independent surveyor. This exemption lasts for 5 years.
  3. Temporary Exemption – this exemption can be applied for following certain events such as a new landlord having acquired the property of the grant of a renewal lease under the Landlord and Tenant Act 1954. This exemption lasts for 6 months.
  4. Nothing More to be Done – this exemption applies to those circumstances where all “relevant energy efficiency improvements” have already been carried out or there are none which can be made. This exemption lasts for 5 years.

To register any of the above exemptions a landlord must enter certain required information in the PRS Exemptions Register. The register has already been open for registrations for over a year.

Penalties

The domestic property regulations will be enforced by Local Authorities. The non-domestic property regulations will be enforced by Local Weights and Measures Authorities.
Landlords who let sub-standard property (EPC bands F and G) but who have not registered a valid exemption will be liable to financial penalties and other action by way of enforcement. These are set out in the table below:

Type of Non-Compliance Penalty
Providing false or misleading information to PRS Exemptions Register A fine of £5000 and publication of non-compliance
Renting out a non-compliant property for a period of less than 3 months A fine of 10% of the rateable value with a minimum fine of £5,000 and a maximum of £50,000
Renting out a non-compliant property for a period of more than 3 months A fine of 20% of the rateable value with a minimum fine of £10,000 to a maximum of £150,000

For any further advice contact our Specialist Team on 0800 088 6004.