Response: BEIS Domestic PRS Minimum Level of Energy Efficiency

By: Vicky Pearlman  Published: July 2018


Shelter response to a BEIS consultation on the introduction of a cap on the amount PRS landlords have to spend in order to bring their properties up to a minimum standard of energy efficiency.

Summary

Shelter welcomes this opportunity to submit evidence to BEIS’s consultation on proposals to amend the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 in relation to domestic properties to remove the ‘no cost to landlords’ principle.

  • We are concerned that the current proposals risk over-complicating the debate and misses an opportunity to simplify and clarify regulations. One of the key aims of the Homes (Fitness for Human Habitation and Liability for Standards) Bill, currently before Parliament, is to bring the HHSRS and Fitness Standard together into one coherent set of standards. It will require all rented homes to meet a basic standard before they are let and throughout the tenancy. Combining the 2015 regulations within the HHSRS, strongly reinforcing the duties of local authorities and supporting renters to use their new rights, could ensure meaningful action on all F and G rated properties in the PRS.  
  • We agree that, if the Government pursues the approach set out in the consultation, landlords should contribute to improving the energy efficiency of their properties.
  • We strongly disagree that the cap on costs for improving sub-standard domestic PRS property should be set at £2,500. We believe that the Government should be much more ambitious and set the cap at at least £5,000
  • We do not agree that a cost cap for improving sub-standard domestic private rented property should be set inclusive of VAT.
  • We agree that the cost cap should not take account of spending on energy efficiency improvements prior to 1 October 2017.
  • We do not agree that the cost cap threshold should be inclusive of any funding which can be obtained through a ‘no cost’ finance plan, supplier obligation funding (including ECO funding) or energy efficiency grant funding from a local authority or other third party.
  • We agree that, where a landlord is intending to register a ‘high cost’ exemption, they should be required to provide three quotes for the cost of purchasing and installing the measures. We would suggest that landlords should also confirm that they have explored alternative (and additional) sources of funding, including ECO and Affordable Warmth schemes.
  • If this regulation is to result in a meaningful improvement to energy efficiency, bringing Band F and G properties up to Band E, then local authorities will need significant additional resource for enforcement.
  • We are concerned that the proposal to allow local authorities to choose to delegate responsibility for enforcement to Trading Standards rather than Environmental Health could hinder effective implementation, particularly where Trading Standards is at County rather than District level in two-tier authorities. Environmental Health holds additional powers that can support action on energy as well as wider improvements in housing standards.
  • We are disappointed that most Houses of Multiple Occupation (HMOs) will not be covered by these proposals.
  • Additionally, we believe that a higher cap need not unduly burden those landlords who own very low value properties nor will it result in higher rents or landlords leaving the market.