MEES, EPC B & Solar: The 2026 Position for Owners

Here is the position as it actually stands in June 2026. The only binding minimum energy efficiency standard (MEES) for commercial property in England and Wales is EPC E. It has been unlawful to let a commercial building below EPC E since 1 April 2023, and it has been unlawful to grant a new lease below EPC E since 1 April 2018. Everything beyond that — the headline “EPC B” figure you will have seen — is a proposal, not law. Getting this distinction right matters because the trade is full of installers and brokers quoting milestones that were scrapped or never existed. This guide sets out what is law, what is proposed, what was abandoned, the penalties, and where solar fits as a band-uplift lever.

What is actually law today: EPC E

Under the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015, a landlord cannot lawfully let a non-domestic property with an EPC rating below E. Two dates matter, and both have already passed:

• 1 April 2018 — it became unlawful to grant a new lease (or renewal) on a sub-E commercial property.
• 1 April 2023 — the standard extended to all let commercial property, including continuing leases and sitting tenants. There is no longer a “we’ll fix it at the next rent review” grace period.

If you let, or continue to let, a commercial building rated F or G in England and Wales without a valid exemption registered on the PRS Exemptions Register, you are in breach. This is the live compliance issue today — not EPC B. A meaningful slice of older stock still sits at F or G, and the 2023 extension closed the loophole that let owners ride out a sitting tenant.

Scope is England and Wales only. Scotland operates a separate regime (assessment of commercial buildings over 1,000 m² on sale or new lease), and Northern Ireland is different again. The figures and dates below apply to England and Wales.

What is proposed: EPC B by 2031 — and only for some buildings

On 18 June 2026 the Government published its interim response on raising commercial MEES, proposing a minimum of EPC B by 2031. Read the conditions carefully, because they are where most summaries go wrong. The proposal:

• applies only to privately-rented non-domestic buildings over 1,000 m², not to every commercial property;
• applies only where the improvements are cost-effective under a defined test;
• is subject to secondary legislation — it is not yet in force, and the detail (the cost-effectiveness test, the compliance window, the interim milestone) will be set by regulations that have not been laid.

So as of today, EPC B is a stated policy direction with a target year, not a binding obligation. If you own a privately-let commercial building over 1,000 m², it is the thing to plan for. If your building is under 1,000 m², the proposal as published does not capture it at all — though future rounds may, and improving the asset still helps value and lettability.

What was scrapped, and what was never law

This is the part competitors get wrong, and it is the single biggest reason to be careful who you take advice from:

• “EPC C by 2027” was scrapped. An earlier consultation floated an interim EPC C milestone around 2027. It was abandoned. It is not government policy. Pages still citing it are out of date.
• “EPC B by 2030” was never law. The frequently-quoted “EPC B by 2030” figure came from a 2019–2021 consultation trajectory that was never enacted. There is no 2030 EPC B obligation. The proposed date is 2031, and it is a proposal.

If a quote, brochure or sales call tells you that you “must hit EPC C by 2027” or “EPC B by 2030 is the law,” treat the rest of that document with caution. The accurate dated position is: EPC E is law; EPC B by 2031 is proposed, over 1,000 m² only, subject to legislation.

The full government guidance is on gov.uk MEES guidance for commercial property — worth bookmarking, because the detail will firm up as the EPC B regulations are drafted.

The penalties — and the public breach register

The cost of non-compliance is calculated on the property’s rateable value and is capped, but it is per-property and it is publicly recorded. The penalty bands for letting in breach are:

On top of the financial penalty, the enforcing authority can publish details of the breach on a public register for at least 12 months. For an institutional owner, a fund or a listed landlord, the reputational and ESG-reporting consequences of a published breach can outweigh the cash penalty. Enforcement sits with local trading standards, and activity has been rising as the 2023 extension beds in.

The penalties attach to the act of letting in breach. They are not a one-off — a property can be re-penalised, and a breach undermines the lettability and valuation of the asset independently of any fine.

The stranding problem: why this is a value issue, not just a compliance one

Even before EPC B becomes law, the market is repricing energy performance. The data, attributed to its sources:

• The British Property Federation (October 2025) reported that around 83% of commercial buildings across seven major UK cities are below EPC B — the scale of the gap to the proposed standard.
• Savills has estimated that roughly 185 million sq ft of UK retail space is at risk of becoming unlettable on energy-performance grounds.
• CBRE has put around 58% of Central London offices below EPC B.

These are stranding figures: the share of stock that, on current trajectory, becomes harder to let, harder to refinance and harder to sell as occupiers, lenders and investors apply their own energy thresholds ahead of any legal deadline. The green-premium evidence is covered separately in our green premium and asset value guide, but the short version is that the market is already pricing the gap.

The cost-effectiveness test and exemptions

The proposed EPC B regime is expected to carry a cost-effectiveness test, mirroring the structure of the existing EPC E exemption. Under the current EPC E rules, an owner is not obliged to spend without limit: the “high cost” / seven-year payback exemption broadly means improvements that do not pay back within seven years through energy savings can be excluded, and there is a registrable exemption where all relevant cost-effective measures have been made and the property still falls short.

Other registrable exemptions under the existing regime include:

• consent exemptions — where a tenant, lender, superior landlord or planning authority refuses the necessary consent;
• devaluation exemptions — where an independent surveyor confirms the works would reduce the property’s market value by more than 5%;
• a temporary exemption of up to six months where a person newly becomes the landlord.

Exemptions are not automatic. They must be registered on the PRS Exemptions Register with supporting evidence, and most last five years. The proposed EPC B rules are expected to adopt a comparable cost-effective-measures-only structure, but the precise test will be set by the secondary legislation — another reason to model your assets now rather than assume either an obligation or an escape.

How solar lifts an EPC — and why it is one of the cheapest band levers

Rooftop solar improves a commercial EPC because the EPC is modelled on a building’s calculated energy cost and CO₂, and on-site generation reduces both. Commercial EPCs are produced using SBEM (the Simplified Building Energy Model), which credits on-site renewable generation against the building’s notional energy demand. Because solar offsets bought-in electricity — the most carbon- and cost-intensive input in the model — it tends to move the rating efficiently.

In practice, solar typically lifts a commercial EPC by one to three bands, depending on the building’s starting point, its electrical load profile, available roof area and the size of the array. We do not promise a specific jump — the SBEM output depends on the building, and the only honest number is the one the assessor models for your asset. But the direction is reliable, and the economics are favourable for three reasons:

1. It pays for itself. Unlike fabric measures — re-glazing, insulation, new HVAC — that improve the rating but never return the capital, solar generates electricity you would otherwise buy at ~24–28p/kWh, with a typical payback of four to eight years. The band uplift is effectively a by-product of an investment that already stands on its own.
2. Zero VAT and full first-year tax relief. Commercial solar has been 0% VAT since April 2022, and the capital qualifies for 100% first-year relief through the Annual Investment Allowance. The tax treatment is set out in our capital allowances and funding guide for owners.
3. It is roof-mounted and reversible. Solar does not disturb tenants the way fabric works do, it can be installed on common parts the landlord controls, and on a multi-let it can lift the building EPC without negotiating access to every demise — see our multi-let commercial buildings guide for how the apportionment works.

For a building sitting at C or D and facing the proposed EPC B trajectory, solar is usually the cheapest single band-uplift lever available, precisely because the cost-effectiveness test it has to pass is one it passes on its own merits. Indicative array costs and payback ranges are on our cost page.

What an owner should do now

You do not need to hit EPC B tomorrow. You do need to know where each asset sits and what the cost-effective path looks like before the EPB B regulations land. A sensible sequence:

1. Confirm every let asset is at EPC E or above today. This is the live legal exposure. If anything is F or G, register a valid exemption or remediate — do not let it ride.
2. Pull the current EPC and SBEM data for buildings over 1,000 m². These are the ones the EPC B proposal targets first. Know the rating, the expiry date and the recommended-measures list.
3. Model solar first, before fabric. Because it pays back and lifts the band, solar is the natural first measure. Get an SBEM-modelled estimate of the band uplift for your specific roof and load, not a generic claim.
4. Sequence with the roof and lease lifecycle. If the membrane has under 15 years left, combine re-roof and solar in one project. If the building is multi-let, work out the apportionment and ownership route before committing.
5. Keep the evidence. Whether you remediate or rely on an exemption, document the cost-effectiveness assessment — it is the basis of both compliance and any future exemption.

If you want a building-specific read — the current EPC, the realistic band uplift from solar, the capex and the payback — request a quote and we will model it against the actual roof, load profile and lease structure rather than a generic assumption.

Frequently asked questions

Is EPC B by 2030 the law for commercial property?

No. “EPC B by 2030” was never enacted — it came from an earlier consultation trajectory that was not made law. The government’s interim response of 18 June 2026 proposes a minimum of EPC B by 2031, and only for privately-rented non-domestic buildings over 1,000 m², only where cost-effective, and only once secondary legislation is in place. The one binding minimum today is EPC E.

What is the minimum EPC I can legally let a commercial property at right now?

EPC E, in England and Wales. It has been unlawful to grant a new commercial lease below EPC E since 1 April 2018, and unlawful to continue letting below EPC E — including to a sitting tenant — since 1 April 2023. Letting in breach without a registered exemption exposes you to a penalty of up to 20% of rateable value (capped at £150,000) plus publication on a public breach register.

Will installing solar guarantee my building reaches EPC B?

No, and any installer who guarantees a specific band jump is overstating it. Solar reliably improves a commercial EPC — typically by one to three bands — because the SBEM model credits on-site generation against the building’s energy cost and carbon. But the exact uplift depends on your building’s starting rating, load profile, roof area and array size, and the only honest figure is the one an assessor models for your specific asset. What solar does reliably offer is the cheapest band-uplift lever, because it pays for itself through displaced grid electricity.

Does the proposed EPC B standard apply to my building if it is under 1,000 m²?

As the proposal stands (18 June 2026), no — it captures only privately-rented non-domestic buildings over 1,000 m². Smaller buildings are outside the proposed EPC B threshold for now, though future rounds of regulation could widen it, and improving the rating still helps lettability, refinancing and value regardless of the legal trigger. Whatever the size, the EPC E minimum already applies to it today.