There has been some positive news for landlords as the year begins, particularly regarding proposed changes to EPC legislation.
This topic has generated significant confusion over the past year, largely due to uncertainty around what is proposed policy versus what is currently law. While no changes have yet been legislated, recent updates to the proposals suggest a more practical and achievable approach, which may be welcome news for the private rented sector.
It is important to stress that all references to EPC requirements remain proposals only. No changes are law at this stage. The recommended approach is for landlords to prepare for potential outcomes but avoid taking action until legislation is confirmed.
Proposed Implementation Dates
Previously, proposals indicated that privately rented properties would need to meet an EPC rating of C (where possible) by 2028 for existing tenancies and 2030 for new tenancies.
The updated proposal removes this phased approach and instead suggests that all privately rented properties should achieve EPC grade C by 1 October 2030.
Given the limited availability of skilled trades and the scale of upgrades required across the UK’s rental stock, removing the earlier 2028 deadline is a more realistic and pragmatic adjustment.
Cap on Improvement Costs
Earlier proposals included a cost cap of £15,000 for required energy efficiency improvements. This has now been reduced to £10,000.
While still a substantial investment, this lower cap is significant. In many cases, it means that major works such as internal or external wall insulation—often a key barrier for older housing stock—may not be required. Had the higher cap remained, there was a risk of a considerable reduction in available rental properties.
If the cost of required improvements exceeds the cap, landlords would be able to apply for a five-year exemption.
Changes to EPC Calculations
Currently, EPC ratings are based on a stepped list of improvements, progressing from low-cost measures such as energy-efficient lighting through to insulation and renewable technologies.
A new EPC methodology is now proposed, although it remains subject to consultation. This proposed system, known as the Home Energy Model (HEM) EPC, would introduce a two-stage assessment process.
Stage One: Fabric Performance
Properties would need to meet a minimum standard for thermal efficiency, focusing on how well the building retains heat. This includes insulation, glazing, and overall heat loss. Heating systems are not assessed at this stage.
Stage Two: Heating or Smart Technology Compliance
Landlords would then be required to either install a low-carbon heating system or introduce smart energy technology, such as on-site energy generation (e.g. solar photovoltaic panels).
Under this model, heat pumps are effectively favoured, and even high-efficiency gas boilers are unlikely to meet the required threshold. As a result, once EPC C certificates issued before 1 October 2029 expire, compliance may require more than fabric improvements alone.
In practice, many landlords may need to invest in either heat pumps or solar panels, in addition to ensuring the property meets fabric efficiency standards, subject to limited exemptions.
The availability of meaningful financial support will be critical in determining how achievable these requirements are for landlords.
Final Thoughts
While recent changes to the proposals are encouraging, significant uncertainty remains. Landlords should ensure adequate reserves are in place and begin considering how potential improvements could be financed if required.
Whether these changes are implemented by 2030 remains uncertain. A later date—such as 2035—or further policy revisions following a future general election cannot be ruled out.
Landlords are encouraged to stay informed and plan cautiously while awaiting formal confirmation of any legislative changes.
