Real World Energy Solutions specialises in helping our clients achieve Best Value EPC Ratings maximising the value of their development projects.
1. Regulation
Any building project these days is controlled by a large number of rules and building regulations as a result of the planning legislation. Regulation in the industry is set to be substantially increased as a result of the introduction of the Climate Change Act 2008.
This Act was made law on 26th November 2008 and is the legal framework that requires the government to reduce Carbon emissions by 80% on 1990 levels by 2050. Non-residential buildings in this country are responsible for in excess of 25% of the Carbon emissions and will be a specific sector that will be targeted.
Regulation is likely to come in the form of building regulations which are constantly being changed and updated along with a Code for Sustainable Buildings that will sit along side the Code for Sustainable Homes already in operation.
The Code for Sustainable Buildings is being developed by The UK Green Building Council and will require newly constructed building to be Carbon Neutral by the year 2019. Carbon Neutral buildings will require significant technological advances in energy efficiency and renewable energy both onsite, near site and off site.
Already local planning authorities are adopting the Merton Rule which requires any new development to produce 10% of its energy on site. The scope of this ruling is now considered routinely to be a minimum and very often the requirement is significantly higher.
Real World Energy Solutions specialise in energy efficiency and renewable energy and understand the implications of regulation. Call us to find out how we can help you practically comply with new legislation.
2. Market Demand
Whilst regulation will be a big driver of energy efficiency there are other drivers that will substantially increase the demand for energy efficient buildings:
- In a world of spiralling energy costs twinned with a reliance on finite and insecure energy supplies businesses need to become energy efficient to protect their future.
- A more energy efficient approach to business can deliver substantial financial gains through reduced costs and more efficient and innovative operational methods.
- Increasingly, organisations are required by the supply chain to prove their environmental credentials and demonstrate that they are committed to reducing Carbon Emissions. The need for a robust Environment Policy is crucial for winning new business and is likely to become more so as new legislation is introduced as direct result of the Climate Change Act comes into force.
- This Act is likely not only to introduce tough new regulation but will also apply fiscal pressures (probably through the Business rate mechanism) to encourage business to reduce Carbon Emissions and meet the 80% reduction target by 2050.
It is clear that ignoring energy consumption is no longer an option for occupiers of commercial buildings.
3. Energy Efficiency and Value
Having established the future demand for energy efficient properties will increase it is worth briefly understanding how this will manifest itself in the form of market value.
The relationship between energy efficiency and value is going to be made very clear with the introduction of the Energy Performance Certificates (EPC).
EPC’s are required for pretty much any building that is Sold, Let or constructed (see Quick Guide to the EPC) and provides a very simple A-G rating method that is easily understood by any occupiers.
As demand for energy efficient property goes up it will not be long before prospective occupiers are chipping the price of low energy efficient buildings as direct result of the EPC rating. We anticipate that a premium will be paid for good EPC rated property, whilst low rated energy inefficient will devalue quickly.
As market value evidence becomes available it will be fed into surveyors valuation reports and will be something the banks will look at carefully when considering the funding of a development.
Whilst other methods of accreditation for sustainability such as BREEAM are important they have no direct relationship with the market value of a building and may not always deliver a top EPC rating and value.
We advise for any new build or refurbishment project you develop the Best Value
EPC Rating.