UK’s landlords not tenants need funding help to meet EPC targets

Landlords need more help in achieving the government’s energy performance certificate (EPC) aims for the private rented sector (PRS) by reducing the number of hurdles to access cash help.

That’s the view of Gina Peters, the head of landlord and tenant at Dutton Gregory Solicitors, who says that the government needs to review its Energy Company Obligation (ECO) grant.

The scheme helps pay for home energy efficiency improvements, but it is only available to tenants that meet the criteria.

The ECO grant was unveiled in 2013 and in its fourth iteration, is called ‘ECO4’, which started in July 2022 – and will be in place until 2026.

The grant offers financial support for environmentally conscious enhancements including improved heating and insulation.

‘Private landlords need to be helped and incentivised’

Ms Peters said: “With more and more people seeking a rental home within a property asset class pool, that is literally shrinking by the day, private landlords need to be helped and incentivised directly, otherwise we will continue to see more and more former rental homes sold, and the prospect of an alarming rise in homelessness.

“If the Government is serious about improving the energy efficiency of the UK’s rental stock, a much more widespread helpful grant needs to urgently be created to appeal to landlords.

“Or, like many in the industry have suggested, the Secretary of State could introduce interest free loans, or lower stamp duty thresholds on properties in need of significant energy performance upgrades.”

‘All well and good hearing sustainability rhetoric’

Ms Peters continues: “It is all well and good hearing sustainability rhetoric, but in a socio-economic and housing crisis, support needs to be much more readily available to turn a worrying tide.

“For landlords with EPC E, F or G rental properties, there might be help available.

“However, the hurdles to jump in order to unlock the funding are too prohibitive, and it is largely dependent on the circumstances of the tenant living in the property, rather than the landlord who owns it.

“A widespread effort to reduce the carbon footprint of the UK’s privately rented homes is certainly not going to be achieved by this unnecessarily complicated grant that hardly anyone is aware of.”

Helping tenants facing fuel poverty

The ECO grant helps pay for external and internal wall insulation, loft insulation, central heating installations and electric storage heating with the main focus of helping tenants facing fuel poverty.

That will see them able to adequately heat their homes.

However, a big hurdle to access funding is that the scheme’s eligibility criteria are just for tenants and not landlords.

To qualify, tenants must meet household income thresholds or have received benefits within the last 18 months.

That means that landlords who are enthusiastic about undertaking energy efficient upgrades will need their tenant’s co-operation and for them to meet the criteria – even if they are enthusiastic themselves about accessing funding.

Grants go to the tenant rather than the landlord

Ms Peters said: “Grants that are issued go to the tenant rather than the landlord, so the only authorisation the property owner has with the grant application is to approve the works.

“The submission process might be able to be completed on behalf of the tenant, however stringent criteria relating to the tenant’s personal circumstances is still required.”

She adds: “The issue the landlords we represent are finding, is that there is no grant specifically available for rental properties, that can be applied for solely based on the current energy performance of the actual home.

“So, gaps between tenancies – when landlords may naturally wish to carry out disruptive internal works – would instantly forfeit any potential grant subsidy.”

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