Property Management

MEES 2031: What the new commercial EPC B rules mean for landlords

An update on the Government’s interim response on Minimum Energy Efficiency Standards (MEES) in the non-domestic private rented sector

Quick answer

From 2031, privately rented commercial buildings in England and Wales over 1,000 square metres will need to reach a minimum EPC rating of B, where cost-effective. Buildings under 1,000 sq m will remain on the current EPC E minimum. The previously proposed 2027 EPC C milestone has been scrapped entirely. None of this is law yet – it still requires secondary legislation.

What is changing under MEES, and when?

The Government has published its interim response on the future direction of Minimum Energy Efficiency Standards (MEES) for commercial let property in England and Wales. While final legislation is still to follow, the update gives landlords a much clearer sense of where policy is heading and, as expected, scraps some of the previous proposals, giving landlords more breathing room than originally suggested.

The headline announcement is a targeted approach that treats larger and smaller buildings differently, rather than applying a single blanket standard across the whole sector.

Which buildings need to reach EPC B by 2031?

From 2031, privately rented non-domestic buildings over 1,000 sq m (10,764 sq ft) will need to achieve a minimum EPC rating of B, where this is cost-effective to do so.

Buildings below 1,000 sq m (10,764 sq ft) will remain subject to the current minimum standard of EPC E, rather than being pulled into the new higher threshold.

The previously proposed interim milestone of EPC C by 2027 has been dropped entirely, giving landlords and tenants more time to plan improvement works around their buildings and lease events.

Existing flexibility mechanisms are being retained, including the seven-year payback test and the established exemption regime, meaning landlords will not be required to carry out works that are not practical, affordable or cost-effective.

Why has the Government taken this approach?

This targeted approach is designed to concentrate effort where the Government believes it will have the greatest impact. Larger rented buildings are expected to be the focus of the EPC B requirement, with the stated aim of helping tenants reduce annual energy costs – estimated at up to £360m collectively by 2031 – while also supporting national energy security and carbon reduction goals.

Smaller properties, including much of the high street and SME-let stock, will continue to be held to the existing EPC E minimum. Landlords of these buildings are being given more flexibility and no fixed deadline to go beyond that level, recognising the different investment capacity of smaller owners and occupiers.

Is this actually law yet?

No.

The proposed EPC B requirement for larger buildings will only take effect once secondary legislation has passed through Parliament.

Further detail, including the precise implementation of the 1,000 sq m (10,764 sq ft) threshold, is still to be confirmed in the Government’s full response to the earlier consultations.

The current EPC E minimum standard remains in force and continues to apply across the sector.

What does this mean for landlords?

For owners of larger industrial, office and retail assets over 1,000 sq m (10,764 sq ft), it would be prudent to begin factoring a 2031 EPC B target into longer-term asset planning, particularly around lease renewals, refurbishment cycles and capital expenditure programmes.

Understanding a building’s current EPC rating and the likely cost of the works needed to reach a B will put you in a much stronger position when the detailed rules are confirmed.

For owners of smaller buildings below the 1,000 sq m (10,764 sq ft) threshold, this update is reassuring. There is no new deadline beyond maintaining the current EPC E standard, giving more flexibility to plan improvements over time and alongside natural ownership or lease events.

In both cases, the retention of the payback test and exemptions regime remains an important safeguard, ensuring landlords are not required to carry out works that do not stack up financially.

What does NG Chartered Surveyors think will actually happen?

Reading between the lines, this interim response looks less like a confident long-term plan and more like a Government buying itself time.

Dropping the 2027 EPC C milestone entirely, rather than simply delaying it, suggests the original trajectory towards 2030 was never realistic once the scale of investment required across the sector became clear. We would not be surprised to see the 2031 EPC B deadline itself slip, or be softened further, once the secondary legislation reaches Parliament and landlord representative groups have an opportunity to influence the proposals.

We also think the 1,000 sq m (10,764 sq ft) threshold will prove to be a blunt instrument. It exempts a significant proportion of the UK’s older, harder-to-treat secondary and tertiary industrial and office stock from ever having to reach EPC B, doing little to improve the buildings that are dragging down the sector’s overall energy performance. In our view, this is as much a political decision to avoid a backlash from smaller landlords and SME occupiers as it is an evidence-led policy choice.

For owners of larger buildings, we expect the retained payback test and exemptions regime to become the real battleground rather than the headline EPC B requirement itself. We anticipate a growing market of consultants helping landlords build exemption cases, and would not be surprised if Government tightens the exemption criteria in future once it becomes clear how many buildings are unlikely to be upgraded.

We also expect the investment and occupational markets to move ahead of regulation. EPC A and B-rated buildings are likely to command increasing premiums, while poorer-performing stock becomes progressively harder to finance, insure and let, particularly to occupiers with their own net zero commitments.

Our advice to clients is simple: don’t take comfort from the softened timetable. Whatever the final legislation says, buildings that fail to improve their energy performance are likely to become harder to let, harder to finance and harder to sell long before any legal deadline arrives.

What should landlords do now?

Use this period before the legislation is finalised to review your portfolio’s EPC ratings and identify which assets are likely to be affected by the proposed 2031 threshold.

NG Chartered Surveyors can advise on likely improvement costs, exemption eligibility and how the proposals should influence your wider asset management strategy.

Please get in touch with your usual NG Chartered Surveyors contact to discuss your portfolio.

Frequently asked questions

What is MEES?

MEES stands for Minimum Energy Efficiency Standards. It is the legal framework that sets the minimum EPC rating a commercial or residential property must achieve before it can be let.

What is the MEES 2031 deadline?

From 2031, privately rented commercial buildings in England and Wales over 1,000 sq m (10,764 sq ft) will need to achieve a minimum EPC rating of B, where cost-effective, subject to secondary legislation being passed.

Do all commercial properties need to reach EPC B?

No. Only privately rented commercial buildings over 1,000 sq m (10,764 sq ft) are proposed to be covered by the new EPC B requirement. Buildings below that threshold will remain subject to the existing EPC E minimum standard.

Has the EPC C requirement for 2027 been scrapped?

Yes. The proposed interim milestone requiring commercial buildings to reach EPC C by 2027 has been removed entirely.

Are there exemptions from MEES?

Yes. The existing flexibility mechanisms remain, including the seven-year payback test and the established exemption regime, meaning landlords will not be required to carry out works that are not practical, affordable or cost-effective.

Is the EPC B requirement law yet?

No. The proposed EPC B requirement for larger buildings will only take effect once secondary legislation has passed through Parliament. Until then, the current EPC E minimum standard remains the legal requirement.

Quick answer

From 2031, privately rented commercial buildings in England and Wales over 1,000 square metres will need to reach a minimum EPC rating of B, where cost-effective. Buildings under 1,000 sq m will remain on the current EPC E minimum. The previously proposed 2027 EPC C milestone has been scrapped entirely. None of this is law yet – it still requires secondary legislation.

What is changing under MEES, and when?

The Government has published its interim response on the future direction of Minimum Energy Efficiency Standards (MEES) for commercial let property in England and Wales. While final legislation is still to follow, the update gives landlords a much clearer sense of where policy is heading and, as expected, scraps some of the previous proposals, giving landlords more breathing room than originally suggested.

The headline announcement is a targeted approach that treats larger and smaller buildings differently, rather than applying a single blanket standard across the whole sector.

Which buildings need to reach EPC B by 2031?

From 2031, privately rented non-domestic buildings over 1,000 sq m (10,764 sq ft) will need to achieve a minimum EPC rating of B, where this is cost-effective to do so.

Buildings below 1,000 sq m (10,764 sq ft) will remain subject to the current minimum standard of EPC E, rather than being pulled into the new higher threshold.

The previously proposed interim milestone of EPC C by 2027 has been dropped entirely, giving landlords and tenants more time to plan improvement works around their buildings and lease events.

Existing flexibility mechanisms are being retained, including the seven-year payback test and the established exemption regime, meaning landlords will not be required to carry out works that are not practical, affordable or cost-effective.

Why has the Government taken this approach?

This targeted approach is designed to concentrate effort where the Government believes it will have the greatest impact. Larger rented buildings are expected to be the focus of the EPC B requirement, with the stated aim of helping tenants reduce annual energy costs – estimated at up to £360m collectively by 2031 – while also supporting national energy security and carbon reduction goals.

Smaller properties, including much of the high street and SME-let stock, will continue to be held to the existing EPC E minimum. Landlords of these buildings are being given more flexibility and no fixed deadline to go beyond that level, recognising the different investment capacity of smaller owners and occupiers.

Is this actually law yet?

No.

The proposed EPC B requirement for larger buildings will only take effect once secondary legislation has passed through Parliament.

Further detail, including the precise implementation of the 1,000 sq m (10,764 sq ft) threshold, is still to be confirmed in the Government’s full response to the earlier consultations.

The current EPC E minimum standard remains in force and continues to apply across the sector.

What does this mean for landlords?

For owners of larger industrial, office and retail assets over 1,000 sq m (10,764 sq ft), it would be prudent to begin factoring a 2031 EPC B target into longer-term asset planning, particularly around lease renewals, refurbishment cycles and capital expenditure programmes.

Understanding a building’s current EPC rating and the likely cost of the works needed to reach a B will put you in a much stronger position when the detailed rules are confirmed.

For owners of smaller buildings below the 1,000 sq m (10,764 sq ft) threshold, this update is reassuring. There is no new deadline beyond maintaining the current EPC E standard, giving more flexibility to plan improvements over time and alongside natural ownership or lease events.

In both cases, the retention of the payback test and exemptions regime remains an important safeguard, ensuring landlords are not required to carry out works that do not stack up financially.

What does NG Chartered Surveyors think will actually happen?

Reading between the lines, this interim response looks less like a confident long-term plan and more like a Government buying itself time.

Dropping the 2027 EPC C milestone entirely, rather than simply delaying it, suggests the original trajectory towards 2030 was never realistic once the scale of investment required across the sector became clear. We would not be surprised to see the 2031 EPC B deadline itself slip, or be softened further, once the secondary legislation reaches Parliament and landlord representative groups have an opportunity to influence the proposals.

We also think the 1,000 sq m (10,764 sq ft) threshold will prove to be a blunt instrument. It exempts a significant proportion of the UK’s older, harder-to-treat secondary and tertiary industrial and office stock from ever having to reach EPC B, doing little to improve the buildings that are dragging down the sector’s overall energy performance. In our view, this is as much a political decision to avoid a backlash from smaller landlords and SME occupiers as it is an evidence-led policy choice.

For owners of larger buildings, we expect the retained payback test and exemptions regime to become the real battleground rather than the headline EPC B requirement itself. We anticipate a growing market of consultants helping landlords build exemption cases, and would not be surprised if Government tightens the exemption criteria in future once it becomes clear how many buildings are unlikely to be upgraded.

We also expect the investment and occupational markets to move ahead of regulation. EPC A and B-rated buildings are likely to command increasing premiums, while poorer-performing stock becomes progressively harder to finance, insure and let, particularly to occupiers with their own net zero commitments.

Our advice to clients is simple: don’t take comfort from the softened timetable. Whatever the final legislation says, buildings that fail to improve their energy performance are likely to become harder to let, harder to finance and harder to sell long before any legal deadline arrives.

What should landlords do now?

Use this period before the legislation is finalised to review your portfolio’s EPC ratings and identify which assets are likely to be affected by the proposed 2031 threshold.

NG Chartered Surveyors can advise on likely improvement costs, exemption eligibility and how the proposals should influence your wider asset management strategy.

Please get in touch with your usual NG Chartered Surveyors contact to discuss your portfolio.

Frequently asked questions

What is MEES?

MEES stands for Minimum Energy Efficiency Standards. It is the legal framework that sets the minimum EPC rating a commercial or residential property must achieve before it can be let.

What is the MEES 2031 deadline?

From 2031, privately rented commercial buildings in England and Wales over 1,000 sq m (10,764 sq ft) will need to achieve a minimum EPC rating of B, where cost-effective, subject to secondary legislation being passed.

Do all commercial properties need to reach EPC B?

No. Only privately rented commercial buildings over 1,000 sq m (10,764 sq ft) are proposed to be covered by the new EPC B requirement. Buildings below that threshold will remain subject to the existing EPC E minimum standard.

Has the EPC C requirement for 2027 been scrapped?

Yes. The proposed interim milestone requiring commercial buildings to reach EPC C by 2027 has been removed entirely.

Are there exemptions from MEES?

Yes. The existing flexibility mechanisms remain, including the seven-year payback test and the established exemption regime, meaning landlords will not be required to carry out works that are not practical, affordable or cost-effective.

Is the EPC B requirement law yet?

No. The proposed EPC B requirement for larger buildings will only take effect once secondary legislation has passed through Parliament. Until then, the current EPC E minimum standard remains the legal requirement.