Every property in the UK is legally required to have an EPC assessment if you are selling, leasing or renting a property.
EPCs are calculated based on two factors: the amount of energy used per square metre, and the level of carbon emissions per year (measured in tonnes).
Not only are more energy-efficient properties cheaper to run, they can also command higher house prices and may be eligible for “green mortgages”, which can come with preferential rates.
However, the system has garnered criticism and is particularly disliked by landlords, who may need to spend thousands to hit Labour’s net zero targets.
Here, Telegraph Money explains the steps you can take to improve an EPC.
- What are EPC ratings?
- Why should you consider improving your EPC?
- Upgrade to energy-efficient lighting
- Insulate your roof and walls
- Invest in double or triple-glazed windows
- Upgrade to a more efficient boiler
- Install underfloor heating
- Implement smart heating controls
- Explore renewable energy options
What are EPC ratings?
EPC ratings refer to Energy Performance Certificates. Properties are assessed on a range of factors, including ventilation, property size and layout, windows and doors and lighting, among others.
Properties are scored on a scale of 1 to 100, and given a letter rating from A (extremely efficient) to G (extremely inefficient). The average EPC rating for properties in England and Wales is “D”.
The ratings system itself has also garnered criticism, with consumer group Which? branding it “inaccurate and misleading”.
For landlords, however, EPCs present a challenge. The current Government has resurrected the requirement for rented accommodation to be EPC “C” grade or above by 2030, which could cost investors thousands of pounds – particularly if they own older buildings, which tend to be less energy-efficient. Currently, landlords must make sure accommodation is rated ‘E’ or above.
The work needed could involve anything from insulating an attic at a cost of a few hundred pounds, or overhauling the energy network and installing a heat pump and solar panels.
Why should you consider improving your EPC?
While making EPC improvements can cost money, there are financial advantages to having a higher rating.
For one thing, the property should be cheaper to run, meaning lower energy bills – if you choose to do things like installing solar panels, you could even make some money back from the extra energy they produce by selling it back to the National Grid.
If you qualify for a green mortgage, you might find you’re offered preferential interest rates, which will give you cheaper bills, and you may also get a better price when you come to sell.
Research by Knight Frank suggests that improving an EPC rating can add up to £20,000 to the property’s value – thanks to buyers valuing the potential energy savings, but also recognising that a higher EPC grade suggests the property has had maintenance carried out relatively recently.
As a landlord, you can face a hefty fine if your property or properties are not up to scratch.
Your own EPC will suggest what improvements could be made to your property to upgrade its efficiency and reach the next stage.
1. Upgrade to energy-efficient lighting
Energy-efficient lighting refers to replacing your current lightbulbs to LED equivalents. According to the Energy Saving Trust (EST), switching to 50-watt halogen bulbs could save you £4 per lightbulb over the course of a year.
This change is becoming less of a choice and more of a necessity, since companies are no longer allowed to manufacture inefficient halogen lightbulbs. The only instances where you might still see them is where shops are still selling their old stock.
Around the house, the EST says it’s still common to find inefficient bulbs in ovens, cooker hoods and security lights.
2. Insulate your roof and walls
The insulation a house might require depends on when it was built; it is considerably more expensive for older homes. Those built after the 1920s typically have cavity walls, which cost around £1,000 to insulate.
Solid walls, more common in older houses, cost about £12,000 to insulate externally and £8,500 to insulate internally, excluding redecorating costs. Floor insulation is between £1,600 and £2,900 for a typical “suspended” floor.
However, costs can be trimmed by sourcing cheaper materials. Savvy landlords can salvage insulation from local building works that would otherwise end up in a skip using online marketplaces such as Facebook or Gumtree. Some are slashing their maintenance costs by 25pc by collecting building materials that would otherwise be thrown away.
Apps have been developed for this very purpose, such as Sustainability Yard, where materials being traded are up to 80pc cheaper than they are new, while 30pc are free.
3. Invest in double or triple-glazed windows
One of the best ways to protect your home from draughts and heat – not to mention noisy neighbours – is by investing in your windows.
There are different window ratings, which affect the cost and energy efficiency. For example, a set of “A-rated” windows for a semi-detached house will typically cost around £7,500. In terms of savings, the EST estimates that by installing A-rated double glazing to windows in an entirely single-glazed semi-detached, gas-heated property, you could save £195 a year and 330kg of carbon dioxide.
If your property is a listed building, or in a conservation area, you may need to consider specialist double glazing options that match the design and thickness of the original windows.
4. Upgrade to a more efficient boiler
Swapping out a gas boiler for a heat pump is a big decision – and one most homeowners will need to face sooner or later, given plans to phase out gas boilers.
New-build homes will not be built with gas boilers from 2025, and the sale of new gas boilers and the installation of oil boilers will be banned for some households from 2035.
Heat pumps are the alternative. Households in England and Wales can get up to £7,500 to put towards the switch via the Boiler Upgrade Scheme, which is due to run until December 31 2027.
The EST recommends homes should be property insulated, with bigger radiators and underfloor heating before a heat pump is installed, which could add thousands to the cost of the switch.
5. Install underfloor heating
Underfloor heating can work with a heat pump or gas boiler, and can be a more efficient way to heat a room than radiators. However, it can also be expensive and messy to install.
You can opt for electric or water underfloor heating. Electric involves a wire being connected to the mains, which heats up when the system is turned on. It can be easier and cheaper to install, and is quicker to warm up. According to Checkatrade, the average installation cost for electric underfloor heating as part of a renovation costs between £60-£85 per square metre.
Water underfloor heating works via a network of pipes; when they are filled with warm water, the pipes heat up and spread that heat to the flooring. This can take a while, and the system is expensive to install. Checkatrade says it costs an average of £135-£185 per square metre as part of a renovation. However, it can have cheaper running costs once it’s in place.
6. Implement smart heating controls
There’s little point using energy to heat rooms that no one’s in, which is why smart heating systems that allow homeowners to switch on the heat in certain rooms and at certain times of day have been becoming increasingly popular – and some can be controlled via smartphone apps.
This can be handy if your plans change – so you can delay the time the heating comes on if you’re going to be out later than you thought.
7. Explore renewable energy options
Solar panels are one of the most common sources of renewable energy, costing £5,500 on average, according to the EST, depending on the type of panel, the size of the area covered and any difficulties with access to the roof.
The opportunity to create your own energy can help reduce your bills, and it’s also possible to sell what you don’t use. However, this will require an energy storage system, which usually include a battery that allows you to capture the energy that’s been generated.
In terms of cost savings, you’ll need to weigh up the battery installation cost, and the fact that some last longer than others. The EST suggests asking an installer to tell you predicted lifespan and cost savings before going ahead with any battery storage purchases.
Other renewable energy options include wind turbines and hydroelectricity.
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