Peer questions impact of EPC exemptions

Graphic of EPC energy rating scale and house outline illustrating PRS energy efficiency targets

9:01 AM, 4th March 2026, 2 months ago

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EPC Landlord News

A peer in the House of Lords has pressed the government to explain whether exemptions for EPCs are slowing down progress in the private rented sector (PRS).

In a written question, Lord Carrington asked about the impact of energy-efficiency exemptions relating to leaseholder and third-party consent exemptions.

The news comes as the government announced all private rented sector homes will need to meet EPC C targets by 2030.

PRS exemptions

In a written question, Lord Carrington asked: “What assessment they have made of the impact of minimum energy efficiency standards exemptions relating to leaseholder or third-party consent on progress towards improving energy efficiency in the private rented sector.”

In response, Lord Whitehead refused to answer, instead referring to the impact assessment.

He said: “The impact assessment published alongside the government response to the improving the energy performance of privately rented homes consultation contains information on the expected impact of third-party consent exemptions on improving energy efficiency in the private rented sector. The treatment of exemptions in the PRS MEES modelling is found in the attached table below.

Exemption	Treatment in modelling
High-Cost exemption	Modelled: If the cost of making even the cheapest improvement exceeds the cost cap, we do not upgrade a property.
All Relevant Improvements Made exemption	Modelled: If no relevant improvements can be made then no improvements are made in the modelling.
Cost Cap exemption	Modelled: Where landlords install measures and hit the cost cap before reaching MEES, the model stops upgrading the property.
Property Value Adjustment exemption (affordability exemption)	Not modelled: This exemption allows landlords of properties valued below £100,000 to work to a cost cap that is 10% of the property’s value. The NBM does not contain property prices to allow robust modelling of the exemption.
Solid Wall Insulation (SWI) exemption	Modelled: For simplicity, we assume all landlords who can take advantage of this exemption do so (there may in reality be a small number of landlords who still wish to install SWI). Thus, our modelling results do not include SWI.
Negative Impacts exemption	Not modelled: We do not account for specific cases where a measure is recommended on an EPC, but determined to negatively impact a property or its value through some other assessment.
Third-Party Consent exemption	Partially modelled: We do account for in-situ tenants not consenting to improvements at a rate of 10%. However, we do not account for refused consent from other third parties, including superior landlords (freeholders) and local authorities through planning permission processes.
New landlord exemption	Not modelled: We do not account for property transfers, but given new landlords exemptions only last for 6 months this will not significantly affect modelling results

Cost cap for landlords

Under the Warm Homes Plan, private landlords will be able to choose between the smart or heat metrics, and the cap on the amount they are expected to invest to meet the new standards will be reduced from £15,000 to £10,000.

The cost cap will be lower where £10,000 would represent 10% or more of a property’s value.

Any spending on energy-efficiency works carried out since October last year will also count towards the planned cap, and the government will deliver a range of finance options, including Boiler Upgrade Scheme (BUS) grants.

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Tags: EPC, EPC exemption, Private Rented Sector, Warm Homes Plan

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