Energy efficiency in private rented housing – when will the changes occur?
Tue 20 Apr 2021
For a while now, due to the coronavirus crisis, landlords in Scotland have been stuck in something of a limbo with regards to the energy efficiency of their homes.
As part of the Scottish Government’s plans to enforce minimum standards to deliver improvements to energy efficiency as part of a National Infrastructure Priority, it consulted on proposals in 2017 to ensure that tenants can enjoy homes that are warmer and more affordable to heat.
The proposals were informed by the Regulation of Energy Efficiency in Private Sector houses (REEPs) Working Group, with the consultation seeking views on how a minimum standard would work, how it would be enforced, and whether there would be some situations where the owner would not be expected to bring the property up to standard.
The SNP-led administration published the analysis of the responses to the consultation in late 2017 and following this announced its plan to bring forward regulations requiring that any property where there is a change in tenancy after April 1 2020 will need to have an Energy Performance Certificate (EPC) rating of at least E. Meanwhile, it said all privately rented properties would need to be at least EPC E by the end of March 2022.
It added that, where there is a change in tenancy after April 1 2022, the property will need to be at least EPC D, and all privately rented properties will need to be at least EPC D by the end of March 2025.
These bold proposals were, however, put on ice by the outbreak of the Covid-19 pandemic, which has led to Scotland being in full or partial lockdown for much of the last year.
The Energy Efficiency (Domestic Private Rented Property (Scotland) Regulations 2020 were set to be implemented on April 1 2020, but due to the Covid-19 crisis, the decision was taken not to launch these regulations at that time – a stance which has remained the same throughout the crisis.
This has been done to reduce the burden on already overburdened and overstretched local authorities, who are busy focusing on frontline emergency responses, as well as putting the safety of tenants and workers at the forefront, the government said.
This remains the position, with confirmation that regulations will not be laid in this current session of parliament, which ends when the Scottish elections are held on May 6 2021.
However, the Scottish Government added that the commitment to improving the energy efficiency of the PRS remains and ‘standards will be brought to Parliament as soon as the pandemic position allows’.
To enable landlords to implement energy efficiency and renewable energy measures, the Private Rented Sector Landlord Loan is still available as a support mechanism. The government says up to £38,500 will be available per property and landlords are able to borrow up £250,000 at any one time, dependent on the number of properties they have available for rent.
More information on the Private Rented Sector Landlord loan, including details on how to apply, can be found at the Energy Saving Trust.
While the pandemic is ongoing, it seems unlikely that the new energy efficiency minimum standards will be brought before Parliament anytime soon. However, it’s still wise for landlords to get ahead of the game and try and improve the energy efficiency of their homes before the new measures come into play.
Exemptions and penalties
Like the equivalent Minimum Energy Efficiency Standards (MEES), which cover privately rented homes in England and Wales, the regulations are set to include a number of exemptions.
The draft version of the legislation lays out a number of exemptions, and also sets out possible enforcement, potential penalties for non-compliance and what constitutes a sub-standard property.
There are likely to be a number of consent exemptions, for example, with the regulations not applying if the landlord has been unable to make relevant energy efficiency improvements to the property to increase the energy performance indicator for the property to ensure that it meets or exceeds the minimum level of energy efficiency due to a variety of factors.
This includes the current tenant refusing consent to any relevant energy efficiency improvement being made, or the landlord having been unable to obtain that consent ‘despite reasonable efforts’ having been made by the landlord to obtain that consent.
While there is an upcoming election, it seems highly unlikely that this will lead to a chance in government, with the Scottish National Party (SNP) expected to return comfortably as the main party of government despite recent controversies.
All recent polls give the SNP a 20-30% lead, although it may fail to secure an overall majority, with the move by former first minister Alex Salmond to launch a new pro-independence party called Alba potentially depriving the SNP of an overall majority in the Scottish parliament. The SNP has been in overall power in Scotland since 2007.
The party has sought to strengthen tenants’ rights and protections over the last 14 years, with longer-term changes introduced by the Private Housing (Tenancies) (Scotland) Act 2016 and subsequent amendments meaning no more fixed-term tenancies, controls on rent increases, longer notice periods and a new (but not compulsory) model tenancy agreement.
A good time to let a home
Despite the ongoing uncertainty over Covid, the elections and the new energy efficiency rules, now still remains a good time to let a home, particularly in popular commuter towns like Livingston which are reinventing themselves as many more people work from home and buy local.
Rural towns and villages – offering peaceful countryside living while still being close enough to major towns and cities, with all their amenities, green space and cultural prowess – have soared in popularity since the start of the pandemic, and West Lothian just so happens to be home to a number of such towns and villages.
As we pointed out previously, great strides are being taken to improve broadband connectivity across the country, which is likely to be a main priority – if not the main priority – of many renters, even more so now with the switch to remote and flexible working.
If you can offer an energy efficient, clean, attractive, well-maintained rental home with decent internet and dedicated work from home space, you should be onto a winner with tenants. Demand remains high for rental homes, due to a number of factors, but priorities have been changing. Now, outdoor space, fast broadband and space in general are likely to score higher than proximity to transport links and bars/restaurants.
Here at Letting Solutions, West Lothian’s first dedicated lettings agency, we are open for business, albeit strictly in line with all the required rules around the coronavirus pandemic. For more information about our current processes, please see our full-page details here.
Don’t hesitate to contact us, even if you are not a current client. You can ring us on 01506 496006 or you can email us at: email@example.com.