EPCs -more than just a piece of paper

Why EPCs have been introduced

The government is targeting a 26 per cent reduction in CO2 emissions by 2020 and a 60 per cent reduction by 2050. With buildings accounting for approximately 50 per cent of current emissions, they offer the greatest scope for reducing emissions without a dramatic change in lifestyle - EPCs will provide accurate information on these emissions.

You can use EPCs to help energy manage your estate

Energy management' will become more important as utility costs continue to rise. An EPC will point out both short-term and long-term ways of improving the energy efficiency of the building, and will subsequently provide useful information for landlords as well as potential purchasers and tenants. There is no obligation to carry out EPC recommendations

You do not have to carry out the recommendations on the EPC. The measures listed on the certificate are for 'recommendation' only and are provided to inform potential purchasers and tenants. They do not have to be carried out and no penalties are awarded if they are not implemented.

EPCs are valid for 10 years

EPCs for commercial properties are valid for 10 years. You do not need to commission a new one if the property is remarketed during this time. It's worth getting to know the assessor

As the EPC will be valid for 10 years, establish a relationship with the assessor who inspected the building. You can then discuss modelling changes to the building and what effects specific changes will have to the EPC with the individual who inspected the property.

Landlords will use EPCs to attract tenants

If a tenant is looking at two identical buildings, but one is significantly more energy-efficient, it is possible the tenant might choose the energy-efficient building. A building with a high energy efficiency rating should, in theory, be able to attract higher premiums and rent from tenants as the utility costs and service charges should be lower than the comparable building.

Values will eventually be influenced by EPCs

EPCs will soon become an essential document in the marketing process. We may soon see both vendors and purchasers using them to negotiate on price as purchasers and tenants will argue that an energy-inefficient building will cost more to run and may be expensive to rectify.

The government is pushing landlords to develop green leases

Under the terms of new 'green leases' being developed in response to government policy, landlords are exploring the possibility of linking issues such as energy consumption, water usage and waste production to financial penalties or incentives. A tenant's performance against these targets could even be used as a factor when negotiating rent reviews on existing tenancies. Clauses related to EPCs could therefore become commonplace on new lease agreements, as well as 'green lease' agreements.

Companies are coming under pressure to be more socially responsible

Companies and individuals have a responsibility to help the environment. If they have a proactive energy management style that promotes energy efficiency then this will help their profile. Once they have EPCs then they can use this information to effectively energy manage their estate and they can use this to promote themselves as "energy aware" and interested in "sustainability" by improving the energy efficiency of their buildings.

EPCs could be used to levy a green tax

There are strong rumours that EPC ratings will eventually be used to generate additional revenue for the government. At the moment this is nothing more than rumour, but it does seem a fairly obvious way of raising a green tax with energy inefficient buildings having to pay more in tax than an energy efficient building.

As you can see from these points, EPCs for commercial properties are a lot more than just a piece of paper. It is my opinion that they will eventually influence values and will become an important document in its own right.

The deadline is approaching

Any pub placed on the market before October 1, 2008 has until January 4 2009 to get an EPC certificate in place.

Don't leave it till the last minute

There is likely to be a last-minute scramble for certificates as deals will be held up without them and vendors face stiff fines for failure to comply.

Andrew Whelan is director of EPCforProperty, a specialist business designed to assist vendors and landlords with obtaining their Energy Performance Certificates (EPCs) For more information go to: www.EPCforProperty.com ​​