Flawed Energy Performance Certificates need reform, say experts

• EPC regime in ‘desperate need of reform’
• Which? report finds evidence of inaccurate information
• EPC essential for access to government grants for fuel-poor homes

As of March 2023, 67% of homes in England have had at least one EPC

The reliability of Energy Performance Certificates (EPCs) is being called into question, with calls for a thorough overhaul amid claims of inaccuracy and misleading processes.

According to a recent Which? report, there is “substantial evidence that the metrics and information in many EPCs may be misleading, and homeowners, tenants, landlords and policymakers could be making decisions based on inaccurate information”. 

Rocio Concha, of consumer body Which?, told The Observer: “Current EPCs are in desperate need of reform as, too often, the information and advice they contain is inaccurate, difficult to understand or unhelpful.”

Government subsidies and grants for energy efficiency improvements often hinge on the EPC ratings of properties, ensuring that financial support is directed where it is most needed.

However, if the EPC rating is out of date, it could mean that people who most need support aren’t receiving it. 

Furthermore, EPC ratings don’t reflect subsequent home improvements, and any property that undergoes significant upgrades after an EPC is issued will still be rated on its previous state, unless a new assessment is conducted. 

The accuracy of an EPC assessment depends on the assessor, and discrepancies have been identified between predicted and actual energy performance. 

As a result, there are calls for EPCs to become real-time energy monitoring systems, much like a smart meter, to provide a more accurate and updated assessment. 

They’ll become more effective in their measurements, won’t fall victim to human variables and will be easily monitored to help with our transition to a greener planet.

“The thing to remember with EPCs is that they are intended to provide a benchmark for a property against a ‘perfect world’ copy of your home,” explains EPC assessor and The Eco Experts contributor Christopher McFadden.

EPCs are “not really an audit of your home and often use some assumptions to reach a rating”, he said.

“Some of the main ones include a limited selection of build date bands for u-Values of walls, floors, roofs, etc.”

McFadden went on to say that while assessors can manually override these with ‘real world’ values, any divergence from the model comes with stringent requirements for evidence, which can put assessors off doing it for fear of failing an audit.

EPC assessors must be accredited by an accreditation company by law, who in turn perform random audits on lodged EPCs.

“These audits go through everything the assessor has entered, and if found in error, the assessor is required to correct and relodge. This can be costly in terms of time and money and may not always be reimbursable for the assessor.”

‘Garbage in, garbage out’

Furthermore, McFadden added that it can result in assessors “playing it safe by entering standard information.” 

“Like any computer model, the phrase ‘garbage in, garbage out’ definitely applies with EPCs. That means the assessor’s experience, the availability of information, and flawed judgments on things like build dates can impact the final rating.”

This is where the audit process has value as it helps assessors “understand where they are going wrong”.

According to McFadden, the EPC software has constantly been updated over the years and is considerably better than it used to be.

“Assessors are limited by what they can do by the software itself but are usually open to changes made to it.”

An EPC summarises the energy efficiency of a building based on use and costs, and comes with recommendations on how to improve your home’s energy performance. 

The certificate was initially launched in 2007, as part of the EU’s Energy Performance of Buildings directive, with buildings receiving a rating from A (very efficient) to G (inefficient).

In the UK, the average EPC rating for a home is band D.

As of March 2023, approximately 67% of all residential homes in England have had at least one EPC registration since records began. London has the highest coverage at 69%.

In England you’re required to have an EPC rating to sell, rent or build a property. A certificate is valid for 10 years and costs £60-£120.

Homeowners or landlords without an EPC can be fined anywhere between £500 – £5000 based on the rateable value of the property.

After nearly two decades since their introduction, there is now an argument that EPCs are becoming outdated, especially in their current form. 

The primary point in favour of EPCs is that they standardise the measurement of a build’s energy performance. This helps streamline property comparisons and makes people more aware of the energy related choices they’re making, with the intention being that owners and tenants will try to reduce their energy consumption.

EPCs also allow potential property buyers to compare homes based on energy efficiency, which could result in cost savings on energy bills. 

In its 2023 home-mover survey, leading property listing site Rightmove found said that only 14.5% of respondents would consider an EPC as a major factor when determining their choice of property while 64.9% said it would be important, but not a top priority. 

They also encourage property owners to improve their buildings’ energy performance. Higher rated buildings are more attractive to buyers/ renters, incentivizing owners to invest in energy-saving techniques such as insulation and double glazing.

However, it could be that a more comprehensive approach to measuring energy performances is needed.