The roadmap to MEES compliance now runs to a single hard milestone: an EPC B rating by 2031 for commercial buildings over 1,000 square metres, where cost-effective. The previously proposed 2027 EPC C interim step has been scrapped entirely. The 2031 requirement is not yet enshrined in law, so landlords should plan against the direction of travel while watching for secondary legislation to pass through Parliament.
Table of Contents
- What does MEES require of commercial landlords in 2026?
- What changed when the 2027 EPC C milestone was scrapped?
- Which commercial buildings fall under the 2031 EPC B requirement?
- Why does your EPC rating matter more than your EPC certificate?
- What does an IES DSM modelling EPC actually tell you?
- How do you build a phased roadmap from E to B?
- What exemptions are available if upgrades are not viable?
- What happens if a commercial landlord fails to comply?
- Key Takeaways
- References
What does MEES require of commercial landlords in 2026?
The current legal baseline is that since April 2018 no new commercial lease or renewal can be granted at EPC F or G, and since April 2023 landlords cannot continue letting a sub-standard property without a registered exemption, according to Thomson & Bancks Solicitors.
MEES applies to most rented non-domestic buildings that require an EPC. A property is caught by the rules when its EPC has a rating of F or G, as set out by Mishcon de Reya.
Key exclusions include buildings that do not need an EPC, properties with no valid EPC or one over 10 years old, short-term lettings under six months with no renewal rights, leases of 99 years or more, and genuine licences to occupy. These exclusions are confirmed by Mishcon de Reya.
The obligation sits on the landlord, not the tenant. A landlord cannot pass MEES obligations down through a tenant’s covenant to comply with statute, according to Mishcon de Reya.
What changed when the 2027 EPC C milestone was scrapped?
The proposed EPC C requirement by 2027 has been abandoned entirely, removing the interim deadline that many landlords had been planning around. The requirement for an EPC C rating by 2027 has been scrapped completely, according to CCA Environmental.
In June 2026, the Government confirmed its plans for commercial properties: from 2031, all commercial properties over 1,000 square metres will need to reach a minimum EPC rating of B, where cost-effective, as reported by Mishcon de Reya.
Buildings below 1,000 square metres remain subject only to the existing EPC E minimum, with no fixed date announced for any further tightening, according to CCA Environmental.
The open question remains what “cost-effective” will mean in practice. Secondary legislation must still be passed by Parliament before the 2031 requirement takes full legal effect, as noted by CCA Environmental.
Which commercial buildings fall under the 2031 EPC B requirement?
From 2031, all privately rented non-domestic buildings in England and Wales with a floor area exceeding 1,000 square metres will need to achieve an EPC rating of B, where cost-effective, according to CCA Environmental.
Buildings below 1,000 square metres will continue to be subject to the minimum rating of E, as confirmed by Mishcon de Reya. This means portfolios may face two different standards depending on building size.
Current guidance does not yet set out how the requirement will be enforced across England, Wales, Scotland and Northern Ireland. The 2031 requirement is stated for England and Wales, leaving regional enforcement detail unresolved.
The Department for Energy Security and Net Zero estimates that tenants in larger non-domestic buildings could save up to £360 million per year by 2031 through reduced energy bills, according to CCA Environmental.
Why does your EPC rating matter more than your EPC certificate?
For any EPC produced before August 2022, the underlying methodology was updated in August 2022, and ratings can shift by one to three full grades when recalculated under the new approach, according to CCA Environmental.
Landlords should check the age and currency of every EPC in the portfolio. A certificate must be no more than 10 years old and be the most recent EPC for the property to be valid, as noted by Mishcon de Reya.
A pre-2022 certificate showing an E or D rating may not reflect where the building actually sits under current modelling. The recalculation risk means a building could be closer to, or further from, the B target than its paper certificate suggests.
This recalculation risk is why desktop modelling should come before any capital spend. Understanding the current modelled rating under the updated methodology prevents investment decisions based on outdated certificate grades.
What does an IES DSM modelling EPC actually tell you?
Dynamic simulation modelling (DSM) using IES software predicts building performance in far more detail than a standard EPC assessment. This matters when the target is a specific grade rather than a pass/fail threshold, because small changes in modelled performance can shift a building between adjacent EPC bands.
Modelling lets landlords test improvement scenarios, including fabric upgrades, services, controls and renewables, against the EPC B target before committing budget. A standard EPC assessment does not provide this level of scenario testing.
CCA Environmental’s MEES 2031 EPC B compliance roadmap sets out this staged approach for commercial landlords, using modelling to establish a baseline and test upgrade pathways.
Modelled outputs also support the cost and energy-saving evidence needed for exemption applications. The seven-year payback test exemption requires detailed cost estimates and energy savings calculations prepared by a qualified professional, according to CCA Environmental.
How do you build a phased roadmap from E to B?
A portfolio-wide audit should come first. Establish which buildings exceed 1,000 square metres, which have valid EPCs, and which sit at F or G today. This baseline is essential before any upgrade planning begins, according to MEES Compliance.
The staged sequence should recalculate or re-model current ratings first, then identify the most cost-effective measures for each building type, then phase works against the 2031 date rather than compressing them into the final years. CCA Environmental recommends this approach.
The removal of the 2027 milestone gives breathing room but not unlimited time, particularly for larger or technically constrained buildings. Landlords who delay may face contractor capacity issues as 2031 approaches.
The most cost-effective route to EPC B varies significantly by building type, so a single template approach rarely works. Portfolio-wide strategies must account for different building ages, uses and existing services, according to MEES Solutions.
What exemptions are available if upgrades are not viable?
The seven-year payback test, known as the Golden Rule, allows an exemption where an assessor concludes improvements would not pay back in energy cost savings within seven years, according to Thomson & Bancks Solicitors.
The devaluation exemption applies where an independent surveyor confirms improvements would reduce the property’s market value by more than 5%. A wall insulation exemption is also available where specific measures would damage the building fabric, as set out by Mishcon de Reya.
Third-party consent refusals, from a superior landlord or planning authority, can also support an exemption. These refusals must be documented and registered to be relied upon.
Exemptions must be registered on the central register, are valid for five years, and are non-transferable. A landlord who assumes an exemption applies without registering it remains fully exposed to enforcement action, according to CCA Environmental.
Six-month temporary exemptions are available for recently acquired properties, lease renewals under the Landlord and Tenant Act 1954, and leases granted under a contractual obligation such as an agreement for lease, as noted by Mishcon de Reya.
What happens if a commercial landlord fails to comply?
The civil penalty is up to 20% of the property’s rateable value, capped at £150,000, plus placement on a public “name and shame” register, according to Mishcon de Reya.
The tenant pays nothing. The lease remains valid and the tenant remains liable for rent and lease covenants, as confirmed by Mishcon de Reya.
Enforcement of MEES falls to local authorities. To date there has been very little enforcement in practice apart from a small number of reported cases relating to residential properties, according to Mishcon de Reya.
Lenders with ESG lending policies may be prevented from backing non-compliant properties, according to Thomson & Bancks Solicitors. Non-compliance is therefore a financing issue as well as a regulatory one.
Key Takeaways
- From 2031, privately rented non-domestic buildings over 1,000 square metres in England and Wales must reach EPC B, where cost-effective, though secondary legislation is still required.
- The proposed 2027 EPC C milestone for commercial property has been scrapped entirely.
- Buildings under 1,000 square metres remain subject only to the current EPC E minimum, with no date set for further tightening.
- EPCs produced before August 2022 can shift by one to three grades when recalculated under the updated methodology.
- MEES exemptions are valid for five years, non-transferable, and must be registered on the central register to be relied upon.
- Civil penalties for non-compliance reach 20% of rateable value, capped at £150,000, plus public naming.
- The seven-year payback test allows an exemption where improvements would not recoup their cost in energy savings within seven years.
References
- Minimum energy efficiency standards – Thomson & Bancks Solicitors
- MEES 2030: What the New Landlord Rules Mean for Your Portfolio – Building Energy Experts
- MEES Upgrade Timeline for Landlords (2026–2030) – MEES Compliance
- MEES 2031 EPC B: Your Commercial Compliance Roadmap – CCA Environmental
- A guide to MEES: The Minimum Energy Efficiency Standards – Mishcon de Reya
- MEES Compliance & EPC Strategy for UK Property Portfolios – MEES Solutions
- Domestic private rented property: minimum energy efficiency standard – GOV.UK