Phoenix Journal · Energy & Regulation
A rating that used to be a formality is becoming a threshold you must clear to keep a building lettable - and in 2026 the bar moved. Here is where it stands.
An Energy Performance Certificate looks like paperwork you only think about when a lease is signed. For hospitality premises that is changing. A rating that was once a formality is becoming a threshold you have to clear to keep a building lettable at all, and the bar has just moved.
An EPC rates a building's energy performance on a scale from A, the most efficient, down to G, the least. For commercial premises the headline figure is a carbon-based rating of the building fabric and fixed services - insulation, heating, cooling, ventilation and lighting - rather than how a particular tenant happens to use it. One is required whenever a building is built, sold or let, and it lasts ten years. For a long time the number sat quietly in the file. What has given it teeth is a separate set of rules that ties the right to let a building to the rating it holds.
The Minimum Energy Efficiency Standards, or MEES, make it unlawful in England and Wales to let a commercial property that falls below a set EPC rating unless a valid exemption is registered. Since 2018 that minimum has applied to new leases, and since 2023 it has applied to all existing commercial lettings too. The current floor is EPC E, which means buildings rated F or G cannot lawfully be let without an exemption. For most premises E has been a low bar, easy to clear. The direction of travel, though, has always pointed upward, and the detail of how far and how fast has now been settled for larger buildings.
In mid-2026 the government published its long-awaited interim response on non-domestic minimum standards. The headline is that from 2031, all commercial buildings above 1,000 square metres must reach at least EPC B to remain lettable, subject to exemptions. Commercial premises below that 1,000 square metre threshold will be required to hold at least an EPC E. The earlier proposal of an interim EPC C milestone in 2027 was dropped, and the timeline for the B target extended from the originally mooted 2030 to 2031. This is also the first time the commercial standard has broken step with the domestic one, which is on a separate path toward EPC C by 2030. The changes take effect through secondary legislation, so the precise mechanics will be confirmed as that passes, but the standard and the date are now set. Understanding where a commercial kitchen loses energy is the practical starting point for any premises that needs to climb the scale.
Exemptions matter because the standard is not absolute. Where the improvements needed to reach the target are not cost-effective, or where consent for the works cannot be obtained, a landlord can register a valid exemption rather than carry out the work - but exemptions have to be registered, are time-limited, and are reviewed rather than granted indefinitely. The government has signalled a more structured approach to compliance and exemptions alongside the tighter targets, including proposals around a payback test and a central database. The safe reading for any operator is that an exemption is a fallback to be justified, not a way to avoid engaging with the building's efficiency at all.
MEES bites on whoever grants the lease, so if you own your premises the duty is yours directly, and if you lease them it shapes what happens at every renewal, rent review and break. Either way, catering premises start at a disadvantage: kitchens are among the most energy-intensive spaces in any building, which drags on the rating. Climbing the scale is not about one grand gesture but a stack of the same efficiency measures that lower the bill anyway - better insulation and glazing, efficient heating and cooling, controlled ventilation, and equipment specified for its running cost. Reading the building's actual consumption is where it starts, and learning to read a commercial energy bill to find the waste often surfaces the cheapest wins first. A clean, correctly run extraction system helps here too, because fouled ductwork makes fans work harder and pushes energy use up. The buildings that struggle in 2031 will be the ones whose owners left it to the deadline; the cost-effective route is to fold improvements into refurbishments and lease events over the next few years rather than facing an unlettable building all at once when the deadline finally arrives.
Questions
EPC E in England and Wales. It is unlawful to let a commercial property rated F or G unless a valid exemption is registered. This has applied to new leases since 2018 and to all existing commercial lettings since 2023.
Under the government's 2026 interim response, from 2031 commercial buildings above 1,000 square metres must reach at least EPC B to remain lettable, subject to exemptions. Buildings below 1,000 square metres will need at least EPC E. The changes take effect through secondary legislation.
The legal duty falls on the landlord granting the lease. But it affects tenants in practice, because a sub-standard building cannot be lawfully let, which shapes renewals, rent reviews and breaks - and the government has consulted on giving tenants some cooperation duties too.
Commercial kitchens are energy-intensive, which weighs on a building's rating. Improving it means the same measures that cut the bill: efficient equipment, controlled ventilation, better fabric, and keeping systems such as extraction clean so they are not wasting energy.
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