EPC B by 2031: what the new MEES rules mean for your estate.

What has changed.

On 18 June 2026 the government published its interim response on minimum energy efficiency standards, known as MEES, for commercial property in England and Wales. It confirmed the direction the market had been waiting for, and changed the timetable.

Privately rented non-domestic buildings over 1,000 m² will need an EPC rating of B or better from 2031, where that can be achieved cost-effectively. Buildings of 1,000 m² or less stay at the current minimum of EPC E, with no new deadline. The interim step to EPC C in 2027, proposed in the original consultation, has been dropped.

The changes still need secondary legislation, and a full government response is expected later in 2026. Until then, the current rules, with a minimum of EPC E, stay in force.

Who it applies to.

MEES applies wherever a property needs an EPC to be let, which covers most commercial lettings. It does not apply to leases of six months or less, leases of more than 99 years, or licences.

• Buildings over 1,000 m² must reach EPC B from 2031, where cost-effective
• Buildings of 1,000 m² or less stay at EPC E
• Most commercial lettings that need an EPC are in scope
• Exemptions belong to the landlord and do not pass to a buyer

The payback test and exemptions.

The seven-year payback test stays. A landlord only has to carry out improvements whose cost is recovered by the expected energy savings within seven years. If no package of measures passes that test, an exemption can be registered.

The other exemptions also remain, including where works would reduce the value of the property, and where consent from tenants, lenders or planners cannot be obtained. Exemptions are personal to the landlord who registers them, so they cannot be passed on when a property is sold. Breaches can currently attract a penalty of up to £150,000, and penalties are published.

What is still to be decided.

Several details will only be settled in the full response and the legislation that follows. None of them change the direction of travel. They affect how compliance is evidenced and enforced, not whether larger buildings need to reach EPC B.

• Whether enforcement and penalties will be strengthened
• How a building is defined and measured for the 1,000 m² threshold
• Whether tenants get duties to co-operate and not to undermine a rating
• Whether the evidence needed for the payback test will change

What it means for your estate.

For landlords, the risk is to income before it is to energy. A building that cannot reach EPC B by 2031 becomes hard to let, and that will show up in lease negotiations, valuations and lending well before the deadline itself.

2031 is closer than it looks in property terms. It is one or two lease cycles away, and inside the replacement window for much of the plant that drives an EPC rating: boilers, chillers, lighting and controls.

The most expensive way to comply is a standalone retrofit programme in the final years before the deadline. The cheapest is to fold the right upgrades into replacements your capital plan already has scheduled, and to price each one against the rent it protects.

A practical route to EPC B.

1. Know your positionList every letting over 1,000 m², its current EPC, when the certificate expires and when each lease event falls.
2. Model the gap to BFind the measures that would lift each building to B: usually lighting and controls, heating and cooling plant and building management, before fabric.
3. Test the paybackPrice each measure, estimate the energy saving and run the seven-year test, keeping the quotes and assumptions.
4. Time it with replacementsUpgrade plant that is due for replacement anyway, so the extra cost of reaching B is as small as possible.
5. Plan around the leasesUse breaks, renewals and voids for disruptive work, and agree access and co-operation with tenants early.
6. Record exemptions properlyWhere B cannot be reached cost-effectively, register the exemption with the evidence behind it.

How Propility helps.

Reaching EPC B is a decision that sits between capital planning, energy and income, which is exactly where Propility works. It reads the EPCs, surveys and asset records you already hold and builds the route to B into your capital plan.

• Finds every letting over 1,000 m² at risk of missing EPC B
• Prices the cheapest route to B for each building
• Weighs each upgrade against the rent it protects
• Keeps the payback evidence ready for any exemption