COMMENT What’s in an energy performance certificate? The answer is data. Lots of it; collated and stored in a standardised and comparable format for almost every building in the country.
In most sectors this would be the starting point for impressive data analysis and insight. The building blocks of technology that could accelerate progress towards net zero carbon emissions by 2050. This is not the case in the UK.
Why not? Because the government has failed to join the dots on its own policy.
By mandating Minimum Energy Efficiency Standards in England and Wales, the government has made EPCs a central plank in its net zero carbon strategy for at least the next seven years.
The legislative landscape dictates:
- You cannot take a property to market without an EPC.
- You cannot legally rent your property without a valid EPC of a minimum standard. That standard is currently E but the government intends to increase this to B in 2030 (only 18% of properties currently reach this standard). Buildings unable to meet this standard must apply for exemption at least once every five years.
- Finally, the EPC must be registered on a central register. Once registered, no information from the EPC model can be shared except a link to the EPC certificate on the central register – ie what I would describe as the fridge-magnet label.
Owners in the dark
This effectively means a property owner has no right to understand how an EPC assessor has arrived at that EPC rating, despite the fact it can have a huge impact on the value of the building and the owner’s ability to sell or rent it.
This seems contrary to reason, reduces transparency and limits a purchaser’s ability to easily validate EPC accuracy within the system.
An EPC is an asset rating that tries to compare a building’s performance on standardised terms. It is effectively a prediction as to how much energy your building should, could or would use on any given day based on things like how it is heated, cooled and how it was built, compared to a reference building.
It requires energy modelling expertise to produce an EPC and these computer-simulated models come in simplified versions or more dynamic and advanced versions, where you can do far more than just produce an EPC.
I have for many years argued that the sector has failed to understand the importance of the data contained within an EPC and the level of skill and expertise required to produce accurate results.
Tick-box exercise
Instead, the sector has treated them as a tick-box exercise, with a race to the bottom on costs. As a result, there are quite a few EPCs out there that I will guarantee are not accurate. This is often to the detriment of the landlord, and potentially the value of the building, as many modellers use defaults and worst-case scenarios in order to complete EPCs quickly and maintain tight cost margins.
This is also a sector where building data is rarely digitised. When it is, it is usually in pockets and held in systems that can only be accessed or understood by the professional collecting it. But the EPC system has already dictated that vast amounts of data about a building be collated, digitised in a standardised format and stored.
By contrast, the government mandates building information modelling and therefore the sharing of data in areas such as construction on government projects, but when it comes to EPC and net zero it prohibits this.
I confess I am not a disinterested observer here. My companies Evora Edge and Edge APM have, for the past year, been developing software designed to help our clients rapidly assess their risks at scale. We needed solutions for sometimes hundreds and thousands of buildings where it is simply not economically viable to employ hundreds of consultants to carry out detailed feasibility surveys (particularly given that these consultants are pretty scarce these days).
Being well versed in energy modelling and EPCs, we knew the type of data held in those models. Given that almost every building in the UK needs to have an EPC, we felt this was a good place to start.
Unfortunately, unless the landlord or owner of the building has been particularly forward-thinking, they will not have asked for the energy model from whoever did the EPC in the first place.
The first fight
While the debate about operational energy ratings versus predicted energy ratings rumbles on, perhaps the first fight should be that the data collected on a building and used to judge that building’s worth in the market should, at the very least, be made available to the owner of the building and to potential purchasers.
In the meantime, forward-thinking REITs and funds may want to change their EPC procurement policy to ensure they also have access to the EPC model for every certificate they commission. Consistency across the sector would be helpful and the Better Buildings Partnership is driving voluntary leadership by developing a standard EPC procurement framework, which hopefully will enable them to leverage the value of this underlying EPC data.
Andrew Cooper is a founding director of Evora Edge and Edge APM
