MEES Explained: The Changing Landscape of Energy Efficiency Standards for Landlords.
Minimum Energy Efficiency Standards (MEES)
The Minimum Energy Efficiency Standards (MEES) are Government regulations aimed at improving energy efficiency in privately rented properties. Since 2018, MEES have applied to new tenancies in the private rented sector (PRS), and since 2020, they have extended to all tenancies. Under current regulations, privately rented properties must have a minimum Energy Performance Certificate (EPC) rating of E to be legally let, unless a valid exemption applies. These standards apply to both residential and commercial properties in England and Wales with leases between 6 months and 99 years. However, properties in Scotland are not subject to MEES regulations.
The 2020 MEES Consultation
In 2020, Government released a consultation for raising the standards for MEES. The key proposals included raising the minimum standard to EPC band C, implementing the change in phases—applying it to new tenancies from 2025 and all tenancies by 2028—increasing the maximum investment required from landlords from £3,500 to £10,000 per property, and introducing a ‘fabric first’ approach. Despite the consultation in 2020, the proposed changes were scrapped in 2023. The Government acknowledges the time passed and changing context since the initial consultation responses were received.
The Latest Consultation
Currently, the MEES are based off the Energy Efficiency Rating (EER) displayed on EPCs—a cost-based metric. However, this approach has several drawbacks. One key issue is that assumptions about fuel prices can quickly become outdated. When fuel prices are updated, properties may shift between EPC ratings, potentially rendering some non-compliant with private rented sector (PRS) regulations. Additionally, because electricity is more expensive than gas, heat pumps may appear to have higher estimated running costs unless paired with improved fabric measures or smart technologies. As a result, EPCs rarely recommend heat pumps, despite their efficiency being three times greater than that of gas boilers.
To address these challenges, the Government has launched a new consultation, building on the 2020 proposal, to revise MEES. The proposed changes would move away from cost-based metrics and instead set standards based on new metrics planned for introduction in the 2026 EPC reform. Three of these new metrics include: a fabric performance metric, a heating system metric, and a smart readiness metric.
Government’s preferred approach is to require landlords to prioritise meeting a standard based on the fabric performance metric, followed by a secondary standard based on either the heating system metric or the smart readiness metric. However, two alternative approaches are also under consideration, the second approach being that landlords must meet a dual set of standards of equal weighting, and the third approach being that landlords must meet an overarching standard set against all three metrics. The final decision on these standards depends on the outcome of the EPC reform. If a different EPC policy is adopted, Government may retain the existing EER-based approach to ensure alignment with the 2030 fuel poverty target.
Another key proposal is to increase the maximum investment landlords must make to improve their properties, raising the cost cap from £3,500 to £15,000 per property. If the cost cap is reached and the property still does not meet the standard, landlords can apply for a 10-year exemption—an increase from the current 5-year exemption period. Government modelling estimates that, on average, properties will require between £6,100 and £6,800 to comply.
The new MEES standard would apply to new tenancies from 2028 and all tenancies from 2030. A ‘new tenancy’ is defined as a tenancy where a domestic property is rented out to a new tenant or a contract with an existing tenant is renewed or extended.
Privately rented homes that achieve EPC band C against existing EPCs, before the new methodology, will be compliant until that EPC expires. If a property falls below EPC band C following the reform in 2026, the landlord will be required to commission a new EPC before taking action to comply with MEES. This ensures that landlords use the updated metrics and implement the appropriate measures recommended in the revised EPC.
Key Concerns of the MEES Consultation
One of the key concerns is the proposed increase in the cost cap to £15,000, which may create affordability challenges for landlords. To address this, the Government is seeking views on introducing an affordability exemption, which would lower the cap to £10,000. This exemption could help mitigate potential disruptions to the PRS housing supply.
Another issue arises when landlords obtain a new EPC before the MEES standards are finalised. In such cases, they may still be required to comply with the existing EPC E rating. However, if the new EPC does not include an EER, landlords may face uncertainty about how to demonstrate compliance. Government is exploring solutions to address this gap.
Additionally, the 2020 consultation proposed that landlords should commission a new EPC after completing energy efficiency improvements. However, Government is reconsidering this requirement, as mandating EPCs both before and after upgrades could place excessive strain on the supply of EPCs.
In addition, the Government is also seeking views on several key areas related to the PRS Regulations. These include expanding the scope of PRS Regulations to cover short-term lets to ensure consistency across the sector, exploring potential regulatory measures to encourage the installation of smart meters in private rented homes, and reviewing existing exemptions to determine whether additional exemptions should be considered in certain circumstances.
This article was written by Molly Ledlie, Technical Specialist (Energy) at Sava.