EU Energy Performance of Buildings Directive: The writing on the wall

Ask anyone interested in the energy efficiency of buildings what has been the greatest influence on their market over the past two or three years and they are likely to talk about the EU Energy Performance of Buildings Directive.

As EU directives go, this one has escaped the wrath of the Daily Mail, but it is responsible for many of the energy efficiency requirements enshrined in UK law today, including energy performance certificates (EPCs) and display energy certificates (DECs).

Now the EU has published its proposals to recast the directive. A consultation was launched a couple of weeks ago by the communities department to consider how the UK should respond (a copy of the consultation can be downloaded from www.diag.org.uk).

There is much to welcome in the proposals, including improvements to EPCs to make the energy savings recommended to people selling, buying and renting homes more bespoke to the property and extra advice to encourage their implementation. I’m also pleased to see that energy ratings will be required in property advertisements.

Of course, as with any new legislation, the devil is in the detail. There are several crucial issues still to be thrashed out. For example, what is the EU’s definition of “low and zero carbon”? The UK is creeping closer to a consensus on these terms, but our definition may be threatened by a ridiculous suggestion from one European commissioner that zero carbon means all energy consumed by a building being generated on site by solar panels or heat pumps.

There is also one bizarre and much bigger anomaly in the EU’s proposals, which appears to have our government’s support, but which makes no sense to me. It suggests that all commercial buildings over 250m2 (such as shops, restaurants and other buildings visited frequently by the public) should display an EPC – the rating they would have received when the building was built, sold or leased. At present there is no requirement to display EPCs, and only buildings of more than £1,000m2 need to display a DEC.

EPCs show only the theoretical energy performance of buildings based on data that rarely, if ever, reflects true energy performance. Only DECs give the true picture

 

Now there may be some merit in making the display of EPCs mandatory, if only to ensure such certificates are actually produced. Recent research by National Energy Services suggests that most high street commercial properties are flouting the law and do not have an EPC available.

However, EPCs show only the theoretical energy performance of buildings based on standardised data and assumptions that rarely, if ever, reflect true energy performance. Only DECs give the true picture. For example, the MPs’ new office building opposite Big Ben, Portcullis House, would probably be awarded an EPC rating of A (or possibly B), but actually only achieves a DEC rating of G.

The proposal is probably supported by the communities department because it’s an easy thing to do. The thinking goes: these commercial properties will have to have an EPC produced if they change hands anyway, so the certificates might as well go up on the wall. But it’s an entirely pointless exercise from a market transformation point of view. Company directors only sit up and take notice when DECs come into play. Buildings are only improved when the truth is published.

So what would make far more sense is for the threshold for DECs to be extended beyond public buildings of more than 1,000m2 to all commercial buildings of a similar size. Thus large hotels, supermarkets and privately owned buildings visited frequently by the public would have to tell the truth every year about actual energy performance.

I shall be beating a track to the community department’s door to discuss these issues as soon as possible. For I have no doubt the new, recast directive could have just as important an impact on our industry as the first. The EU Council of Ministers is already developing its position, ready for negotiations with the parliament and commission straight after the summer break. There is no time to lose.