Last reviewed: September 2026. Covers England and Wales. Based on the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 and the government's interim response of June 2026; the secondary legislation for the 2031 standard has not yet been laid, so check for updates before relying on the future dates.

The MEES commercial EPC rules changed in June 2026, and most of what landlords planned around in 2024 and 2025 is now wrong in one direction or the other. The interim EPC C 2027 milestone has been dropped. The EPC B 2030 target has moved to 2031 and now applies only to buildings over 1,000 square metres. Everything under that threshold stays at EPC E with no further deadline. What has not changed is that a sub-standard property (rated F or G) cannot be let or continue to be let today without a registered exemption, and the penalties for getting that wrong run to £150,000 per breach.

This guide sets out the rule as it stands, the trajectory as the government has now confirmed it, which leases are caught, how the exemptions and the MEES exemptions register work, what the penalties are with a worked example, and how to plan improvements for a portfolio where some buildings need to get from D to B in five years and others need nothing beyond keeping their E.

At a glance

The rule and the trajectory

The minimum energy efficiency standards for non-domestic property come from the 2015 Regulations. Since 1 April 2018 a landlord has not been able to grant a new lease of a property rated F or G, and since 1 April 2023 a landlord cannot continue to let one either. A property below E is a sub-standard property in the language of the regulations, and letting it without a valid registered exemption is the breach the penalties attach to.

The trajectory beyond E was consulted on in 2019 and 2021 and then left unanswered for five years. The government's interim response, published 18 June 2026, settles it as follows.

Three points in that table matter for planning. First, "where cost-effective" carries the existing seven-year payback test, so a large building that cannot reach B with measures paying back inside seven years will be able to register an exemption at B just as it can today at E. Second, the 1,000 square metre threshold has not yet been defined in legislation (gross internal area is the likely basis, but the regulations will say), so buildings near the line should not be classified yet. Third, the interim response is a statement of intent; until the amending regulations pass through Parliament the only enforceable standard is E. A full government response with the enforcement detail, the treatment of shell-and-core lettings and any tenant duties is expected later in 2026.

The primary sources are the interim response on GOV.UK and the non-domestic landlord guidance.

Which leases are caught

The regulations apply to a non-domestic property in England and Wales that is let under a tenancy and is legally required to have an EPC. Both halves of that test exclude a set of buildings and leases.

On the lease side, tenancies granted for a term certain of six months or less are outside scope, unless the tenancy contains a right of renewal beyond six months or the tenant has already been in occupation for more than twelve months. Tenancies of 99 years or more are also outside scope. Everything between, which is almost every commercial lease, is in.

On the building side, the property must be one that requires an EPC. The main categories that do not are places of worship, temporary buildings intended for use of two years or less, standalone buildings under 50 square metres, industrial sites and workshops with low energy demand, and buildings due for demolition. Listed buildings are a common source of confusion: they are not exempt from needing an EPC as a class, only where compliance with minimum energy performance requirements would unacceptably alter their character or appearance, and that has to be assessed building by building. A landlord who assumes a listed building is out of scope, and is wrong, is letting a sub-standard property.

The obligation sits with the landlord, which for a headlease and sublease structure means both the freeholder letting to the head tenant and the head tenant letting to the occupier. A property manager acting for either is not the landlord, but the compliance work (checking the EPC, registering the exemption, scheduling the works) lands on the manager in practice, and the lease abstract should record the EPC rating and expiry alongside the other critical dates. Our lease abstraction checklist covers the field list.

Exemptions and the register

A landlord who cannot bring a sub-standard property up to E (and, from 2031, a larger building up to B) can continue to let it under a registered exemption. The exemption has to be entered on the PRS Exemptions Register before the landlord relies on it; an exemption that exists on paper but not on the register is no exemption at all. The register is public and searchable.

Two features of the register cause most of the trouble in practice. Exemptions are personal to the landlord: when the property is sold, the buyer cannot inherit the seller's exemption and must either comply or register their own (the six-month new-landlord exemption exists to give them time). And exemptions expire. A seven-year payback exemption registered in April 2023 runs out in April 2028, at which point the landlord has to re-test the payback at current energy prices and current quotes, and either improve or re-register. A portfolio that registered a wave of exemptions at the 2023 deadline has a wave of expiries in 2028, three years before the 2031 standard arrives for the larger buildings.

Penalties

Enforcement is by the local weights and measures authority, which can issue a compliance notice requesting evidence and then a penalty notice. The financial penalties for letting a sub-standard property are set by the length of the breach.

Alongside the financial penalty the authority can impose a publication penalty, which puts the landlord's name and the breach on the public register. The penalties are per property and per breach, and a landlord found to have registered a false exemption is exposed to both the false-information penalty and the letting penalty for the period the property was let without a valid exemption.

Worked example: A 2,500 square metre office in Leeds with a rateable value of £400,000 is rated D. It is compliant today. Suppose instead it were rated F, let on a ten-year lease, and the authority found the breach eight months after the 2023 deadline. The breach is over three months, so the penalty is 20% of £400,000, which is £80,000, inside the £10,000 floor and the £150,000 cap. Had the same breach been caught in its second month, the penalty would have been 10%, or £40,000, against a £50,000 cap. On a larger building the cap bites: a £1.2 million rateable value at 20% would be £240,000, capped at £150,000.

The rateable value link is why the exposure is not uniform across a portfolio. A secondary industrial unit with a rateable value of £30,000 faces a floor-level penalty of £10,000 for a long breach; a prime office with a rateable value of £750,000 faces the £150,000 cap. Prioritise the compliance review by rateable value as well as by EPC rating.

Improvement planning

The MEES commercial EPC planning problem now has two tracks, and the first step is to sort the portfolio into them.

The first track is buildings of 1,000 square metres or less. They need to hold E. The work is a check that every EPC is current (a certificate lasts ten years, and a building whose EPC was issued in 2016 for a 2018 letting needs a new assessment before any re-letting), a check that any registered exemption has not expired, and a watch on the EPC methodology changes, because a re-assessment under updated conventions can move a marginal E to an F without a single change to the building.

The second track is buildings over 1,000 square metres, which need to reach B by 2031 where cost-effective. For those, the sequence that works is: commission an EPC with a recommendation report from an assessor briefed to model the measures to B, not just to E; cost each recommended measure and run the seven-year payback test on it at current energy prices; identify which measures fall inside seven years (typically lighting, controls, heating and cooling plant replacement at end of life, and metering) and which fall outside (typically envelope works and glazing); schedule the inside-seven-years measures against lease events, because a landlord needs vacant possession or tenant consent for most of them; and document the outside-seven-years measures as the evidence base for a payback exemption at B if the building still falls short.

Lease events are the constraint that decides the timetable. A building fully let on leases expiring in 2032 cannot have its plant replaced in 2030 without tenant cooperation, so the works either happen at the next rent review or break, or under a green lease clause that gives the landlord access and a cost recovery route. How service charge and improvement cost recovery is structured for a multi-let building is in our guide to the office service charge budget, and the clause families that give a landlord the access and data rights are covered in green lease clauses. For industrial stock, where the tenant often controls the plant and the roof, the renewal is the moment to negotiate the works; see industrial lease renewals.

A practical action plan for the next twelve months, in order: list every let building with its floor area, EPC rating, EPC expiry, rateable value and any exemption with its expiry; flag any F or G without a registered exemption for immediate action; flag exemptions expiring before 2028; classify buildings above and below the 1,000 square metre line provisionally; commission recommendation reports for the larger buildings rated C or below; and map the lease events in each larger building between now and 2031.

Recording EPC data and exemption expiry in the asset register

The failure mode in MEES compliance is rarely a landlord who does not know the rule. It is a portfolio where the EPC certificates are PDFs in a shared drive, the exemption registrations are in an email thread, and the person who knew when the 2023 exemptions expire has left. The fix is to hold the data against the building record with dates that generate work, not against a spreadsheet that somebody remembers to open.

The building record needs the EPC rating, the certificate reference and issue date, the expiry date (ten years from issue), the floor area on which the 1,000 square metre classification will rest, the rateable value, the recommendation report and its measures with their costs and payback periods, and for any exemption, the type, the registration date, the evidence file and the expiry date. Each expiry date is a reminder with an owner and a lead time long enough to commission an assessment or re-run a payback test before the current certificate or exemption lapses.

In RIOO on NetSuite, the utility and asset management module tracks the building's assets with their condition, maintenance history and lifecycle data, and holds the compliance documentation and scheduled inspections against the property, which is where the EPC certificates, recommendation reports and exemption evidence belong. The lease and its documents sit in leasing management, which sends automated reminders for renewal deadlines and inspections, so an EPC or exemption expiry can be tracked beside the lease events that decide when the works can be done. The energy consumption behind the EPC modelling comes from the same utility accounts and meter readings the module records from bills and reads.

Frequently asked questions

Q1. What is the current MEES commercial EPC standard?
EPC E. Since 1 April 2023 a landlord in England and Wales cannot let or continue to let a non-domestic property rated F or G unless a valid exemption is registered on the PRS Exemptions Register. This applies to existing leases as well as new ones.

Q2. Do commercial landlords still need EPC C by 2027?
No. The interim EPC C 2027 milestone proposed in the 2021 consultation was dropped in the government's interim response of 18 June 2026. There is no interim standard between E today and B in 2031.

Q3. Is EPC B by 2030 still the target?
The target is now EPC B from 2031, not 2030, and it applies only to privately rented non-domestic buildings over 1,000 square metres, where cost-effective under the seven-year payback test. Buildings of 1,000 square metres or less remain at EPC E with no further deadline. The change requires secondary legislation that has not yet been passed.

Q4. What are the penalties for breaching MEES?
For letting a sub-standard property: 10% of rateable value (minimum £5,000, maximum £50,000) for a breach under three months, and 20% of rateable value (minimum £10,000, maximum £150,000) for a breach of three months or more. Registering false or misleading information on the register or failing to comply with a compliance notice carries a £5,000 penalty, and the authority can also publish the breach.

Q5. How long does a MEES exemption last, and does it transfer on sale?
Most exemptions last five years from registration; the new-landlord exemption lasts six months. Exemptions do not transfer to a new owner, who must comply or register their own exemption. When an exemption expires the landlord must reassess the property and either improve it or register a fresh exemption.

Related reading

• Office service charge budget: how to build and defend it (UK)
• Green lease clauses: what they oblige and how to draft them
• Industrial lease renewals: the 12-month runway
• Lease abstraction checklist
• Commercial building energy audits: what a manager must arrange