I read with interest the article on energy performance certificates (EPC) (27 April, page 64-66). The premise of the survey – that EPCs will have an immediate effect on landlords and tenants – betrays a misunderstanding of the mechanics of EPCs.

By making energy performance information mandatory, it is designed to lead tenants to include energy performance in their economic appraisal, creating a market for better performing buildings. Landlords and tenants not yet being aware of the EPC’s requirements does not matter. If landlords can’t benefit from making improvements then it is unlikely many will pay for them, and if tenants don’t know how expensive a building will be to run, they can’t choose to occupy the cheapest buildings.

The market for A-rated buildings will only mature once tenants realise they can save money by using energy certificate ratings. Only when this market begins to mature will the incentive to improve the building’s energy performance be passed on to landlords.

Time will tell how strong this incentive will be, and although it may not compel landlords to make major upgrades, it is likely to drive latecomers to make low-cost improvements. Furthermore, this will create a foundation for future innovation.

Jack Jenkins, Hurleypalmerflatt

Topics