Are energy efficiency laws really about to wipe £16bn from the value of UK commercial properties?
Added: (Mon Nov 13 2017)
Pressbox (Press Release) -
A leading Scottish energy efficiency expert has questioned research claiming one in five commercial buildings could see their values plummet in the aftermath of upcoming energy legislation.
UK Government figures suggest 19% of commercial properties in England and Wales will fail to comply with the new Minimum Energy Efficiency Standard (MEES) when they come into force in April 2018.
Similar standards have already been introduced in Scotland.
One research paper has speculated that £16.54bn may be wiped from the value of UK properties as a result.
The new standards will require properties to achieve a minimum commercial EPC rating of ‘E’ and will apply to new leases and renewals.
Figures from C02 Estates estimate that properties not achieving the new standards may become uninhabitable or un-rentable and will see a significant fall in their value – wiping £16.54bn from the total value of UK estates.
Scottish energy expert and commercial EPC specialist Raj Chall of Scottish Energy Services is not convinced.
“If £16bn was really about to be wiped off the value of English and Welsh properties by the introduction of higher energy efficiency standards you would expect this to have already occurred in Scotland following the introduction of similar commercial EPC regulations such as last year’s Section 63 legislation.
“This research relies heavily on the assumption that buildings with incredibly low commercial EPC ratings are desirable in the first place – and I’d seriously question whether or not that is truly the case.
“Such buildings are liable to be incredibly costly to heat and light, and are unlikely to be particularly attractive places to work or likely to impress customers.
“Our experience of commercial EPC Glasgow and commercial EPC Edinburgh suggests that if anything companies will pay a premium on properties with enhanced energy efficiency, knowing that this investment is likely to significantly pay off in a number of ways.
“What is clear is that there is a total lack of awareness about the introduction of the MEES legislation, with greater confusion caused by the different legislation in England and Wales and Scotland. That’s something that the UK government seriously has to address with the clock rapidly ticking down to the implementation date.”