Commercial Property EPC Update: Minimum Energy Efficiency Standards Regime (MEES)

After more than five years of uncertainty, commercial landlords finally have some clarity on where the Minimum Energy Efficiency Standards (“MEES”) regime is heading.

On 18 June 2026, the Department for Energy Security and Net Zero (“DESNZ”) published its interim response to the 2019 and 2021 MEES consultations, setting out revised targets for non-domestic EPC ratings in England and Wales.

We have summarised the key changes below and what they mean in practice for landlords, investors and occupiers.

What has changed

The current position remains unchanged for now. Landlords generally cannot let, or continue to let, commercial premises with an EPC rating of F or G unless the property is improved to at least an E or a valid exemption is registered. That has been the law since 2018 (new leases) and 2023 (all existing leases).

What has changed is the future trajectory. The Government’s interim response alters the previously proposed 2019/2021 roadmap in three important respects:

• The 2027 interim step to EPC C has been dropped –  Landlords no longer need to plan for an across-the-board C rating requirement in April 2027.
• The EPC B requirement now applies only to larger buildings – From 2031, privately rented non-domestic buildings over 1,000 square metres will need to hold a minimum EPC B rating, where cost-effective to achieve. Buildings under 1,000 square metres remain subject to the existing EPC E minimum, with no set deadline for any further increase.
• The deadline has moved back a year, from 2030 to 2031 –  This effects the buildings now caught by the higher standard.

Exceptions that remain in place

Two of the existing flexibility mechanisms in the MEES regime are confirmed as surviving into the new framework:

The seven-year payback test (which can exempt a landlord from meeting energy requirements for a sub-standard property where the cost of works would not be recouped through energy savings within seven years); and

The established exemptions framework.

In other words, the Government’s aim remains that only improvements that are practical, affordable and genuinely cost-effective will be required.

Legislation still to follow

It is important to stress that the June announcement is, by DESNZ’s own description, an interim response.

The EPC B requirement will only take effect once secondary legislation has passed through Parliament, and a fuller government response – addressing outstanding questions such as enforcement powers, penalty levels, and whether tenants should be subject to statutory duties not to undermine a building’s EPC rating –  is still awaited.

Practical takeaways

• Landlords of non-domestic buildings over 1,000 square metres should begin factoring an EPC B target for 2031 into asset management and capital expenditure planning, while keeping an eye on the further legislation still to come.
• Landlords of smaller commercial premises can, for now, continue to plan around the existing EPC E minimum, though the direction of travel across the sector makes it sensible to keep energy performance under review regardless of size.

We will continue to monitor developments as the Government publishes its fuller consultation response and the necessary secondary legislation progresses through Parliament and will provide further updates as the position becomes clearer.

In the meantime, if you have any questions about your portfolio and how it may be affected, please get in touch.