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MEES update – March 2017: Are you ready for MEES?

Property Focus / 07 March 2017

Can it really be over 5 years since the Minimum Energy Efficiency Standards (MEES) were first showcased?  I know, I can’t quite believe it either!

Since 2012 MEES has gradually been making its way into the headlines.  We took on board the warning about minimum EPC ratings, meaning that if your property is F- or G-rated, you needed to pay attention.  We managed to keep track of the proposed implementation dates and possible exemptions, but overall it was difficult to help clients plan for the impact of MEES because of the lack of detail issued by the Government.  So we were excited when the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 (SI 2015/962) (MEES Regulations) were eventually published in March 2015.  However, the MEES Regulations carried no explanatory information to help commercial property owners understand how MEES would work in practice, meaning we were still left trying to guess what would require compliance and what would be exempt.  Well, the wait is finally over!

The Department for Business, Energy and Industrial Strategy (BEIS) has at last published its guidance on the MEES Regulations for non-domestic properties, meaning we don’t have to guess any more.

For those of you who are still ignoring MEES or taking the view that it doesn’t apply to your property, a reminder of MEES’ key requirement may be in order:

MEES makes it an offence for an owner of commercial property to grant a lease unless the property reaches a minimum energy efficiency standard before it is let.  This requirement will apply to all new commercial leases from April 2018 and allcommercial leases from April 2023, subject to some exceptions.

Two important highlights of BEIS’ guidance are:

  • Occupation of a sub-standard property by a licence or by an agreement for a lease may side-step MEES compliance. However, both these options can be risky in practice and we wouldn’t necessarily recommend them as viable alternatives to a properly-negotiated commercial lease.
  • Contrary to general market opinion, not all listed buildings are exempt.

We will continue to review the MEES Regulations alongside BEIS’ guidance and consider their impact in more detail.  We will provide further updates, but please get in touch if you have any queries.  We’d also be interested to know how you are preparing for MEES in practice.

You can read the MEES Regulations here
You can read BEIS’ guidance here

NOTE: This article covers commercial properties only, but it is important to note that MEES also applies to residential properties and some of the MEES Regulations relating to residential tenancies are already in force.

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