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The importance of Energy Performance Certificates (EPC) in conveyancing process

Energy performance certificate and conveyancingAs we all know, the conveyancing process does not begin unless a seller decides to put his property for sale. The property here could be an individual selling his house or a developer selling a newly built office to some investor such as a pension company, etc. The seller may employ the services of an agent to help him find a buyer and advertise the property. Once an interested buyer is found, the conveyancing process begins. It should be noted that there are a few important documents such as the Energy Performance Certificates (EPCs) that the seller would need if the process is to be begin smoothly.

EPC is required under the guidelines issued under the Energy Performance of Buildings (Certificates and Inspections) (England and Wales) Regulations 2007 (SI 2007/991) as amended by the Energy Performance of Buildings (Certificates and Inspections) (England and Wales) Amendment Regulations 2010 (SI 2010/1456).

According to these regulations, when a building is sold or being rented, the seller (or the landlord as the case may be) must produce an EPC (available for free) before entering into a contract for sale or rent, and the EPC should be commissioned before the property can be sold.  Failing to comply with these regulations attracts penalties.

Thus, a majority of buildings sold or rented in UK carry an EPC. It applies to both commercial as well as residential property, but the need for EPC is now being phased out gradually. Today, only non- residential buildings with a total (useful) floor area of more than 500m2 need to produce these certificates. Exceptions are also available to a property about to be demolished.  Obligations are also imposed on air-conditioning systems that exceed the given power output to be subject to an energy assessment every 5 years.

EPC was introduced to comply with the European Energy Performance of Building Directive. Today, almost 40% of the UK’s energy consumption arises from the way millions of our buildings are heated and used.  Even a small change in the energy performance of a property can significantly alter the energy consumption in the country and even help to reduce carbon emission in the country.

The EPC contains an indication of the energy needed to use a building. This is called ‘asset rating’ and is expressed as a number on a graph labeled A to G. EPC also carries recommendations to improve the energy consumption in the building along with the potential ratings if the recommendations are implemented.

An EPC is issued by a special inspector.  When marketing the property estate agents will also have to mention details of the energy consumption mentioned in the EPC.

Photo courtesy: LadyDragonflyCC <3

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