Government Opens Consultation Period on Effectiveness of EPCs

Vibrant welcomes a vital two-way dialogue between the property sector and decision makers, and a true 360 degree review of an outdated commodity

The UK Government has today, 26th July 2018, issued a Call for Evidence paper on ‘Energy Performance Certificates for Buildings’ in a strategic effort to “gain evidence on the effectiveness” of EPCs and the “suitability” of the system as it currently stands, to obtain insight as to how they could be “further improved, extended or streamlined”.

The call comes as part of the government’s Clean Growth Strategy, published in 2017, which sets out “ambitious policies and proposals to reduce building energy use, underpinned by the extended use of Energy Performance Certificates (EPCs)”. The mission is to “halve the energy use of new buildings by 2030” and halve the costs required to reach the same standards in existing buildings, the latter objective having already been implemented with the Minimum Energy Efficiency Standards regulations applied to let properties, effective as of April 2018.

The government recognises that while EPCs were initially designed to support consumer decision making, there’s greater “legal and financial weight” being placed on an EPC rating as a growing number of “financial incentives and requirements” now rely on the property’s rating, such as ‘green mortgages’. The Call for Evidence asks how well the current system is performing, and whether there is a need to improve the EPC in order to better support ‘emerging uses’.

Specifically, ministers are not looking to improve the “underlying modelling methods” of EPCs, but to identify current ‘trigger points’ for assessment and other triggers that would require an updated EPC, which can ‘feed into’ the model. Consideration is being given to lowering the validity period of the EPC, currently set at 10 years, to ‘nudge’ property owners to make energy improvements.

“To understand the reliability of EPCs we need to understand what may cause discrepancies between EPCs for the same or similar buildings,” the authors state. “Possible causes are variations in assessor expertise and accreditation body requirements”, it’s claimed, along with “difficulty assessing certain buildings or features” and “competition on cost driving down quality”.

Suggestions are outlined throughout the paper, including possibilities for improving and ‘streamlining enforcement’ across rented properties, perhaps to one governing body. The reliability and accuracy of EPCs is also called into question, as is ‘data quality’, with “error in observing and recording details of the building” cited as one cause.

It’s offered that “discrepancies could be occurring as a result of different levels of training and experience amongst EPC assessors, because of different auditing processes and software employed by different accreditation bodies”. Competitive pricing is also factored in that it encourages assessors to “spend less time in a building which means they make more errors”.

A Green Deal Mystery Shopper Exercise, carried out during 2014, is cited as providing evidence that “almost two thirds” of existing domestic properties analysed during the exercise showed variations of “at least two EPC bands across the five assessments done”, with indications that the provided EPCs were “less reliable for older properties”.

“The current EPC system has become somewhat outdated and in our opinion it has become a commodity,” says Daniel Kittow, Managing Director at Vibrant Energy Matters. “We welcome a greater emphasis being placed upon the importance of the EPC, combined with a revised product that gives improved consistency in the results.

“The current EPC provides an indication only of energy output, but with little consequence or incentive to the homeowener/tenant/landlord. We would welcome a true 360 degree review of how EPCs are used – for instance, shouldn’t a property with lower carbon output receive a reduction in council tax? We think so! In order to better reward responsible households an accurate and more frequent EPC will be required.

Vibrant sees this consultation period as a fantastic opportunity to improve the pace at which we reduce energy use and carbon footprint from residential property.”

Vibrant is the UK’s largest property services company and a specialist in providing the largest number of quality EPC assessments for sales and lettings agents across the UK.

This major open consultation is a significant and welcomed opportunity for the industry to give valuable feedback, and make effectual suggestions that could greatly streamline the legislation and processes governing the private rented sector, and clamping down on rogue assessors delivering sub-standard quality.

About the paper:

The paper is the first issued by newly appointed Housing Minister, Kit Malthouse, as a collaboration between the Ministry of Housing, Communities & Local Government and the Department for Business, Energy & Industrial Strategy.

“Improving the energy performance of our buildings is a key part of the government’s aim of building a Britain fit for the future”, say ministers in a typically sweeping topline statement. “Boosting productivity, helping business create high quality jobs right across the country, and ensuring an economy that works for everyone” is the outcome that the government believes their Clean Growth strategy can help achieve.

A copy of the consultation paper, ‘Call for Evidence: Energy Performance Certificates for Buildings’, can be found on the UK Government website here:

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/729853/epcs-call-for-evidence.pdf

 

//END