2nd July 2026 ❘

Proposed Changes to Minimum Energy Efficiency Standards for Commercial Property

Rebecca Collihole - Commercial Property Partner

By Rebecca Collihole, Commercial Property Partner.

The Department for Energy Security and Net Zero has published an interim response to its earlier consultations (in 2019 and 2021) on increasing minimum energy efficiency standards (MEES) for non-domestic private rented properties in England and Wales, i.e. affecting commercial properties.

While this is not yet the final position, the response provides a useful indication of the Government’s intended direction of travel and highlights key considerations for commercial landlords and investors.

Key Proposals

The headline points from the interim response are as follows:

  • Higher standard for larger buildings
    The Government intends to raise the minimum energy efficiency standard to EPC rating B by 2031 for privately rented non-domestic properties with a floor area exceeding 1,000 square metres.
  • No change for smaller properties
    For privately rented non-domestic properties below 1,000 square metres, the minimum standard is expected to remain at EPC rating E.
  • No interim 2027 target
    The previously proposed interim milestone, which was originally going to require properties to achieve EPC rating C by 2027, will no longer implemented.
  • Retention of existing exemptions and flexibility
    The Government has confirmed that existing flexibility mechanisms will remain in place, including the 7-year payback test and the current exemptions regime.

This approach is intended to ensure that landlords are only required to carry out improvements that are practical, cost-effective, and affordable. The Government has also stated that this update focuses on supporting businesses that rent larger premises by helping to cut their energy costs and improve energy efficiency.

What Happens Next?

This is an interim response only. A full response is expected later in the year, which will provide further detail on implementation and timing.

In due course, amendments will be made to the regulations, being the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 (SI 2015/962), to give effect to any changes.

What This Means for Landlords

Although the proposals are not yet finalised, landlords of larger commercial properties (over 1,000 square meters) should begin to consider the potential implications of a minimum EPC rating of B by 2031, particularly in relation to:

  • future investment and asset management strategies;
  • refurbishment and improvement planning; and
  • potential impacts on lettings and asset value.

Early planning may help to manage costs and avoid future compliance risks. If you’d like further advice please get in touch and we can put you through to our Commercial Property Solicitors.