​​Improving the energy efficiency of socially rented homes in England

​​This consultation seeks views on government’s proposal to set a minimum energy efficiency standard (MEES) for socially rented homes. ​​This consultation is an important step in ensuring that every tenant has a decent, warm and comfortable home. We are considering options to raise energy efficiency standards in the domestic social rented sector to make homes easier to heat, tackling fuel poverty and lowering carbon emissions. ​Socially rented homes are not currently required to meet a minimum EPC standard and current requirements are roughly equivalent to an EPC ‘F’ rating. We propose setting the standard at EPC C or equivalent by 2030. This mirrors proposals to raise standards in the private rented sector, set out within a recently closed consultation Improving the energy performance of privately rented homes: 2025 update . ​This MEES will be included in the revised Decent Homes Standard (DHS) as part of a Criterion D on thermal comfort, on which the government is also currently consulting: Consultation on a reformed Decent Homes Standard for social and privately rented homes . ​The recently closed consultation on the future of Energy Performance Certificates provides an opportunity to ensure the standard in the social rented sector incentivise the appropriate measures for each home: Reforms to the Energy Performance of Buildings regime . ​In this consultation, we are seeking stakeholder views on the approach to setting a minimum energy efficiency standard for the social rented sector. This consultation also includes a call for evidence, where we are seeking stakeholder views and plans to decarbonisation. We will consider responses when developing this standard and other future related policies.​ Scope of the consultation Topic of this consultation: This consultation seeks views on the implementation of new Minimum Energy Efficiency Standards ( MEES ) for the social rented sector at Energy Performance Certificate ( EPC ) Band C or equivalent by 2030. It covers the following areas: setting a Minimum Energy Efficiency Standard addressing implementation issues longer-term decarbonisation and Net Zero Scope of this consultation: Social Housing Regulation and Net Zero. Geographical scope: These proposals relate to England only. Impact assessment: The attached impact assessment published alongside this consultation sets out the expected impacts (costs and benefits) of the proposals made in this consultation. Basic information Body/bodies responsible for the consultation: The Ministry of Housing, Communities and Local Government and the Department for Energy Security and Net Zero. Duration: This consultation will last for 10 weeks from 2 July 2025 to 10 September 2025. Enquiries: For any enquiries about the consultation please contact: srs.mees@communities.gov.uk . Or write to us at: SRS MEES Consultation Social Housing Quality and Residents Division Ministry of Housing, Communities and Local Government 3rd Floor, Fry Building 2 Marsham Street London SW1P 4DF How to respond: We strongly encourage responses to be submitted online using the Citizen Space link below, where possible, as this supports timely and efficient analysis of responses. Respond online at SRS MEES Consultation . Or, in the event, you are unable to do so: Email to: srs.mees@communities.gov.uk . Written responses should be sent to: SRS MEES Consultation Social Housing Quality and Residents Division Ministry of Housing, Communities and Local Government 3rd Floor, Fry Building 2 Marsham Street London SW1P 4DF When responding, please state whether you are replying as an individual or representing the views of an organisation. Please include: your name your position in the organisation (if applicable) the name of the organisation (if applicable) an email address Demographic questions In which capacity are you responding to this consultation? Social housing resident Local authority registered provider Housing association/ private-registered provider Non-registered provider Leaseholder in a building with social rented homes Tenant/ resident representative group Landlord/ registered-provider representative group Industry body (e.g. National Housing Federation) Manufacturer, supplier or supply chain representative body Charity, NGO or campaign group Public body (e.g. Homes England, Regulator of Social Housing) Academia, think tank or any other research organisation Standards/ accreditation body (e.g. TrustMark, PAS) Finance/ lending organisation Government body Member of the public (not in social housing) Other (please specify) If you are responding on behalf of an organisation, please specify which organisation: [free text] If responding as an individual, in which region do you live and work? North East North West Yorkshire and the Humber East Midlands West Midlands East of England South West South East London Prefer not to say N/A - I am answering on behalf of an organisation If you are answering as or on behalf of a registered provider of social housing, in which region(s) do you operate mainly (i.e. where you manage properties, where you carry out work)? Please select all that apply. North East North West Yorkshire and the Humber East Midlands West Midlands East of England South West South East London Prefer not to say N/A - I am answering as an individual If you are answering as or on behalf of a registered provider of social housing are the majority of your properties located in urban or rural locations? An urban area is defined as having a population of more than 10,000. Urban Rural Equal split If you are answering as or on behalf of a registered provider of social housing: how many rental properties do you manage? <1,000 1,000 – 15,000 15,000 – 40,000 40,000+ Prefer not to say We strongly encourage responses via the online survey, particularly from organisations with access to online facilities such as local councils, representative bodies and businesses. Consultations receive a high-level of interest across many sectors. Using the online survey greatly assists our analysis of the responses, enabling more efficient consideration of the issues raised. Your response will be most useful if it is framed in direct response to the questions posed, though further comments and evidence are also welcome. If you are responding in writing, please make it clear which questions you are responding to. Consultation reference: Consultation on Minimum Energy Efficiency Standards in the Social Rented Sector in England. Audiences: This consultation is for Registered Providers of social housing and anyone representing the interests of the sector, tenants of social housing, any organisations involved in the management of or investment in social housing, local and regional government, third sector organisations concerned with energy performance or climate change, any members of the supply chain (energy performance installers, Domestic Energy Assessors, for example). Ministerial foreword Foreword by Matthew Pennycook MP, Minister for Housing and Planning, and Miatta Fahnbulleh MP, Minister for Energy Consumers Everyone deserves the security and comfort of a safe, decent and warm home. Yet far too many social rented homes fall short of this basic standard, leaving tenants living in substandard conditions and struggling to pay their energy bills. This is an intolerable state of affairs and we intend to put it right. Alongside our commitment to delivering the biggest increase in social and affordable housebuilding in a generation, this government is determined to drive a transformational and lasting change in the safety and quality of social housing and to upgrade millions of homes through the Warm Homes Plan to cut bills and tackle fuel poverty. These are complementary objectives, and we are working in lockstep to deliver them. When it comes to improving the energy efficiency of social housing stock, we recognise that significant progress has been made over recent years. However, we must do more to drive up standards so that all tenants enjoy a safe, decent and warm home. The reforms set out in this consultation are crucial to achieving that aim. They introduce, for the first time, new Minimum Energy Efficiency Standards to the social rented sector ( SRS ) – a vital step towards making sure every tenant living in social housing can expect a minimum standard of decency. These proposals build on those we consulted on earlier this year in relation to improving energy performance in the private rented sector ( PRS ). Our departments have worked in partnership to ensure we are driving complementary improvements across the SRS and PRS , while recognising the unique needs of each sector. We appreciate fully that landlords need certainty about the standards and requirements they are expected to meet. That is why we are consulting on these changes at the same time as providing clarity on long term funding support and future regulation on quality and safety. The new Minimum Energy Efficiency Standards will become part of the Decent Homes Standard ( DHS ) which is also being reviewed through a consultation so that it better meets the needs of today’s tenants and landlords. We invite tenants, landlords and others to share their views on our proposals, with suggestions for improvements, and how they can be made. By working together – MHCLG , DESNZ and the sector overall – we can make homes warmer, improve the lives of hard-working people and families, and build a brighter, more sustainable future for generations to come. Executive summary Aim of this consultation 1. The purpose of this consultation is to seek views on government’s proposals to introduce Minimum Energy Efficiency Standards ( MEES ) for social rented homes in England. This will deliver warmer homes that are cheaper to heat, taking thousands of families out of fuel poverty and reducing carbon emissions. Summary of the proposed policy 2. Government will set MEES in the social rented sector ( SRS ) using new metrics that are proposed following Energy Performance Certificate ( EPC ) reform. The new metrics will assess the energy performance of buildings based on fabric performance, smart readiness, and the efficiency and emissions of the heating system. Further detail on these planned metrics and other proposals relating to EPC reform can be found in Chapters 1 and 2. 3. MEES will be included in the Decent Homes Standard ( DHS ) as part of a Criterion D on thermal comfort, on which the government is also currently consulting at Consultation on a reformed Decent Homes Standard for social and privately rented homes . Both consultations close on 10 September 2025. As with the wider DHS , the standard will apply to all registered providers of social housing in England and will be regulated by the Regulator of Social Housing (RSH). This will apply to both private registered providers and local authority registered providers of social housing. It does not include properties owned under Low-Cost Home Ownership Schemes (LCHO) such as shared ownership properties. We will refer throughout the document to those in scope collectively as ‘providers’. 4. Government’s preferred approach for SRS MEES both: requires landlords to meet a standard using reformed EPC metrics, meeting the fabric metric at band C and either the heating system or the smart readiness metric has a compliance date of 2030 to meet the standard, after which it will be regulated by the RSH. This means that we propose to implement MEES sooner than the rest of the new DHS which is proposed to be implemented in either 2035 or 2037. 5. Government appreciates that the proposed standard will be different to that which providers have been working towards ( EPC Energy Efficiency Rating (EER) C). For some homes, it will be more expensive to meet the new MEES standard than the current EPC EER C standard. Recognising this increased ambition, the consultation also seeks views on the suitability of alternative standards. This includes using different combinations of metrics, allowing greater provider flexibility over which metric they satisfy or by using a single fabric metric to prioritise warm homes. 6. This consultation also seeks views on how MEES will be introduced and implemented. Government proposes that: there is a time-limited spend exemption for providers, meaning the maximum a provider would be required to spend to comply with MEES between now and 1 April 2030 is £10,000 per property. If the property still does not meet the minimum standard after the £10,000 expenditure, the exemption would allow providers to delay meeting the proposed minimum standard for a further 10 years from 2030. This is not a maximum spend, and providers can spend more if they wish. social rented homes achieving EER C against existing EPCs, before new EPCs are introduced, would be considered compliant with the standard until those EPCs expire. This aligns with the phased implementation approach outlined in the PRS MEES consultation. social rented homes that meet the existing EER C standard between the introduction of the new EPCs and 1 April 2028 would also be considered compliant with the proposed standard until their EPC certificates expire. This will support providers who already have multi-year projects in train to achieve the current EER C and avoids delaying work to make homes energy efficient. 7. Chapter 3 is a call for evidence and invites views from providers on longer-term planning and decarbonisation beyond 2030, as well as views on the role of government in supporting the SRS to decarbonise. Chapter 1: Introduction 8. This consultation outlines the proposed approach to the introduction of Minimum Energy Efficiency Standards ( MEES ) to social rented homes in England for the first time. It complements the recent consultation on improving MEES in the private rented sector ( PRS ) which closed on 2 May 2025. We welcome views on the extent to which commonality between rented tenures is appropriate. 9. Government has a clear plan for change with five core missions. Improving energy efficiency standards is a critical step towards improving health outcomes for tenants, tackling fuel poverty and meeting our commitments to reduce domestic carbon emissions and make Britain a clean energy superpower by 2030.The ambition to get Britain building and deliver 1.5 million homes is also a core consideration within fundamental elements of this consultation. We must improve the energy efficiency of homes whilst balancing these requirements against the need to increase overall supply. 10. We want to put the right energy efficiency standard for the social rented sector ( SRS ) in place to deliver these outcomes. It is one of a series of wider reforms, such as reforms to the DHS and Awaab’s Law, that government will undertake to ensure all social tenants have safe, warm and decent homes. Why introduce Minimum Energy Efficiency Standards? 11. There are currently no minimum energy efficiency requirements in the SRS . Since 2017, the share of social homes with an EPC rating A to C has increased from 52% to 72% and most private registered providers of social housing (PRPs) have plans in place to upgrade the remainder of their stock to at least EPC (EER) C by 2030. Setting a MEES for the SRS for the first time at EPC C or equivalent will build on this momentum and provide certainty to providers on requirements so that they can plan and invest in current homes and in building new homes. 12. If introduced, MEES would be included in the Decent Homes Standard ( DHS ). This will raise standards for tenants while allowing social housing landlords the flexibility to choose to install energy efficiency measures that are right for their properties. 13. The DHS is the minimum quality standard that social homes should meet. Government is also reviewing the wider DHS to bring it up to date and ensure homes are fit for the future. The DHS consultation is available and open for responses – respondents should consider the package of reforms in the round. 14. Introducing MEES in the SRS would have 3 main benefits: (1) Improving the decency of homes 15. Energy efficient homes are more comfortable to live in. They retain their internal temperatures more effectively, wasting less heat in cold weather and staying cooler in the summer. This results in homes that are less prone to damp and more comfortable for tenants. 16. Improved energy efficiency is crucial to tackling damp and mould - an adequately heated, ventilated and insulated home prevents condensation which causes damp and mould. There is a marked correlation between energy inefficient homes and the presence of damp and mould, with 20% of social renters in the least energy efficient homes suffering from damp problems, in comparison with only 3% of social renters in the most efficient homes. The tragic death of two-year old Awaab Ishak in 2020 highlights the potentially devastating impact of damp and mould if left untreated. The Building Research Establishment (BRE) estimate that the potential savings to the NHS resulting from a fixing a category 1 level damp and mould hazard is nearly £9.8 million per year (2019 prices). 17. This means energy efficient homes that are warmer and more comfortable for tenants are also likely to have additional health benefits for the most vulnerable such as disabled tenants, the elderly and young children. Warmer homes are expected to ease the symptoms of several medical conditions and promote healthy development of children. (2) Achieving bill savings and reducing fuel poverty 18. Greater energy efficiency enables tenants to heat their homes more affordably. Our analysis of government’s preferred MEES option predicts average annual bill savings across all homes upgraded of between £96 and £165 for tenants by 2030. Further detail of this analysis is available within the Impact Assessment (IA), published alongside this consultation. 19. Since 2020, the rise in energy prices has impacted the ability of many households to heat their homes adequately, with fuel poor households disproportionately affected. Bill savings are the best long-term method to tackle fuel poverty. The statutory fuel poverty target is to upgrade as many fuel poor homes as reasonably practicable to a minimum energy efficiency rating of Band C by 2030. 20. Whilst the average EPC scores across homes in the SRS compare favourably to other tenures, there remain significant levels of fuel poverty in homes below EPC C. In 2024, 55% of social homes in England with an EPC rating of D to G were classified as fuel poor against the Fuel Poverty Energy Efficiency Rating (FPEER). (3). Net zero and the energy performance of social rented homes 21. Homes currently contribute up to 20% of total greenhouse gas emissions in the UK. Achieving net zero requires our housing stock’s energy efficiency to improve and transition to low carbon heating. We need to have mostly eliminated emissions from our housing stock by 2050 and to have made significant progress this decade to meet our Carbon Budgets . There are 4 million households in the SRS in England, equating to 16% of all households. In 2023-24, just under 30% of social rented homes in England were below EPC C. Introducing MEES would support progress towards making social rented homes carbon neutral. 22. Moving to low carbon heating methods, such as air source and ground source heat pumps and connection to low carbon heat networks, will support our climate goals and reduce energy bills for tenants. Alongside fabric upgrades and smart measures to improve flexibility, low carbon heating options typically operate much more efficiently than their fossil fuel heating counterparts. 23. Government is exploring ways to further bring down the running costs of low-carbon heating, so that future households see the efficiency of their low-carbon heating systems translated into greater bill savings. Related policy reforms 24. The policy proposals set out in this consultation link closely with wider reform work being carried out to improve standards in the private and social rental sectors. These are set out below. Please use the information below to support responses in Chapter 2 (Consultation). 25. The key related policy reforms are: a. Energy Performance Certificates – Alongside updating EPC metrics (see Chapter 2 for more information), the Energy Performance of Buildings consultation proposes refining requirements for EPCs and Display Energy Certificates (DECs), improving data management protocols, strengthening quality control, and revising Air Conditioning Inspection Reports (ACIRs). b. Government intends to consult later in 2025 on aspects of the Home Energy Model (HEM) and its application to EPCs. Final confirmation of the grades that social rented homes will be required to meet under MEES will follow once the HEM consultation response is published and the design of the EPC metrics is finalised. c. Awaab’s Law, which will be introduced to the social rented sector from October 2025. It will set new requirements for social landlords to address hazards such as damp and mould in social homes within fixed time periods, before extending to all hazards except overcrowding featured in the Housing Health and Safety Rating System (HHSRS) over the course of 2026 and 2027. d. The Decent Homes Standard, which has played a key role in setting the minimum housing quality standards that all social homes in England are required to meet since the early 2000s. Government is consulting in parallel on updating the DHS and extending it to the PRS . SRS MEES will be implemented through Criterion D of the DHS (thermal comfort) from the compliance date (2030). The consultation on reviewing the DHS sets out proposals for other elements of criterion D, relating to the need for homes to have programmable heating, that will sit alongside MEES . e. A revised MEES in the PRS will improve housing quality, reducing energy costs and supporting net zero by ensuring homes are warmer, more efficient, and less costly to heat. This is part of a broader strategy to help tackle fuel poverty and lower carbon emissions, benefiting both tenants and landlords. While it is the ambition to align MEES across rental tenures, we recognise the need to take account of the specific circumstances of each. f. The development of Future Building Standards that will result in significant emissions reductions and efficiency increases compared to previous standards. These changes will keep us on track for our net zero targets, while ensuring that consumers get the best possible balance of efficiency, affordability and comfort for new homes. g. A review of the 2021 Fuel Poverty Strategy was published on 7th February 2025 alongside a consultation on a new fuel poverty strategy for England which ran until the 4 April 2025. By updating the fuel poverty strategy, government wants to ensure that more households can afford to heat their home at a reasonable cost, slashing fuel poverty and improving their quality of life. We will provide a response to the consultation in due course. Support for social landlords 26. Government has committed to deliver the biggest increase in social and affordable housebuilding in a generation and to ensure that our existing homes are safe, decent and warm. To achieve this, we have announced measures at the Spending Review to increase the sector’s capacity, confirming a rent settlement of CPI +1% for ten years. The government is also publishing a consultation on how to implement a convergence measure, with options for this being capped at £1 or £2 per week– with a final decision to follow at this year’s Autumn Budget. This complements the new £39 billion Social and Affordable Homes Programme which gives providers a decade of certainty over the capital funding they will have available to build new, more ambitious housing development projects. 27. Furthermore, the following interventions exist to support social landlords deliver their obligations for energy efficient homes both directly and indirectly: We are investing £13.2 billion in the Warm Homes Plan (WHP) over the Spending Review period, in line with the Manifesto commitment. This is a major step forward in the government’s plans to upgrade millions of homes over this parliament across the country by accelerating the installation of efficient new technologies like heat pumps, solar, batteries and insulation. The Warm Homes: Social Housing Fund ( WH:SHF ) Wave 3 is providing £1.29 billion of grant funding for social housing landlords to improve the energy performance of their properties through the installation of energy efficiency measures and low carbon technologies from 2025/26 to 2027/28. Additional funding for social housing landlords through the WH:SHF will be set out in the WHP in October. The Affordable Homes Guarantee Scheme 2020 provides low-cost, flexible and long-term loans to help fund investment in new and existing affordable homes across England, including those for social rent, affordable rent and shared ownership. The scheme can also be used to upgrade existing properties, making them warm and decent for tenants. It supports private registered providers of social housing to deliver energy performance and housing quality measures whilst continuing to support new development and increasing total guarantee capacity from a maximum of £3 billion to a new maximum of £6 billion. The expanded scheme went live in early 2024 and the application window is open until April 2026. The National Wealth Fund ( NWF ) announced in October 2024 that it will provide financial guarantees that will see Barclays UK Corporate Bank and Lloyds Banking Group deliver £1 billion of funding to accelerate the retrofit of social housing in the UK. In April 2025, the NWF announced a financial guarantee of up to £400 million to cover a series of new loans provided by NatWest Group to registered providers for the retrofit of social housing stock in the UK. In June, the NWF guaranteed an initial £150 million for The Housing Finance Corporation. This brings NWF ’s total support for social housing retrofit to £1.3 billion. By enabling £1.65 billion of lending through these guarantees, the NWF is ensuring that attractively priced financing is available to every aspect of the social housing market and caters to all needs. 28. Introducing this proposal alongside broader social housing reforms as part of our plan for a decade of renewal in social and affordable housing, will give the sector much-needed clarity and certainty on how to improve energy efficiency, raise housing quality and ensure safety, while minimising disruption to tenants’ lives and building new homes. Devolution 29. This consultation proposes a MEES to be implemented by Registered Providers of social housing in England only. Energy efficiency is a devolved matter and social housing in Wales, Scotland and Northern Ireland should adhere to standards set out by the relevant devolved authorities. Although these proposals will mainly affect tenants of social housing in England (including licensees), we recognise that there are situations where Registered Providers of social housing have stock across England and Wales. We will work with the Welsh Government during the implementation phase to establish a position that works best for providers, tenants, and regulators. 30. Through the English Devolution White Paper, government has set out an ambitious new framework for English devolution, moving power out of Westminster to those who take decisions for and with their communities. The framework expands and deepens the powers and functions available to Mayors and Strategic Authorities, including new powers over housing and strategic planning. Government wants to see all of England access devolved power by establishing Strategic Authorities that can make the key decisions to drive economic growth. Retrofit standards 31. We wish to ensure that any energy efficiency measures installed are of a high standard. The British Standards Institute (BSI) published Publicly Available Specification (PAS) 2035/2030:2023 in September 2023. This represents an industry-wide approach to ensuring quality in the retrofit of people’s homes and is freely available for download on BSI’s webstore . 32. To avoid any unintended consequences arising in properties being retrofitted, such as damp and mould, we recommend that the measures proposed in this consultation are installed by TrustMark-registered installers in accordance with the PAS 2035 standards, but we are not proposing that this becomes a requirement for SRS MEES . It is already a requirement for all energy efficiency measures installed through the WH:SHF , in alignment with requirements across all government funded schemes. Using TrustMark-registered installers provides assurance that businesses have been vetted for technical competence, customer service and good trading practices, it also provides consumers with access to redress if needed. 33. Microgeneration Certificate Scheme ( MCS ) are the leading quality assurance organisation for microgeneration (small scale renewable 50kW or smaller) technologies (such as heat pumps or solar panels) in the UK. MCS produces product and installation standards and runs an installer certification scheme. For a microgeneration installation to be eligible for government grant schemes like the Boiler Upgrade Scheme, it must be installed using a MCS approved product, by a MCS certified installer, to the relevant MCS installation standard for that technology (or by an equivalent scheme). 34. All MCS installers are required to be a member of the United Kingdon Accreditation Service (UKAS) approved certification body, who assesses their competence and ability to meet MCS standards. All MCS installers are also currently required to be a member of a Chartered Trading Standards Institute approved consumer code, who offer Alternative Dispute Resolution (although MCS plan to take this inhouse during 2025/2026). It is not a requirement for MEES that microgeneration installations are carried out by MCS registered installers. However, we recommend that MCS registered installers are used because it will ensure that an installation is carried out to a high-quality standard, using a product that has been rigorously tested, by a qualified installer. It also provides the strongest consumer protections, should there be problems with the installation. 35. While this system is working for many installations, the standards and accreditation process can be complex, and the accountability structures are not always clear. We also know the supply chain is constrained. Clear technical standards and strong consumer protection and redress are pivotal to ensure quality installations. We are therefore committed to improving the system, spanning from how installers working in people’s homes are certified and monitored, to where homeowners turn to for rapid action and enforcement if things go wrong. This work is already underway by DESNZ , with existing frameworks being tightened, but we will set out further plans for reform as part of the Warm Homes Plan. Climate adaptation 36. Government’s vision for the action we are taking, including MEES , will make homes both warm and resilient to extreme temperatures caused by climate change. Government has been carrying out a programme of research to respond to the risks identified by the third Climate Change Risk Assessment from overheating to health and wellbeing and the energy system, indoor air quality, and building fabric. This research is closing evidence gaps by identifying the buildings most vulnerable to extreme heat and where these are located, as well as appropriate adaptation solutions. This work is informing the development of the Warm Homes Plan and we will also consider what further research is needed to develop housing standards to ensure this can support climate adaptation action in future years. 37. In October 2024, DESNZ published a report on the energy efficiency retrofit measures in homes and their impact on summer overheating . This confirmed that energy efficiency measures, if correctly installed, are unlikely to exacerbate the risk of overheating. In particular, loft insultation, when installed with adequate ventilation was found to reduce risk of overheating. This highlights the importance of good quality installations. 38. The PAS 2035/2030:2023 specification has strengthened the guidance and requirements for climate resilience and adaptation in retrofit. As above, we therefore recommend providers have measures installed by Trustmark-registered installers in accordance with the PAS 2035 standards when improving homes to meet MEES . Chapter 2: Consultation Setting a Minimum Standard 39. This chapter seeks views on the options for the metric(s) used to assess compliance, timing and implementation support for setting a MEES of EPC C or equivalent by 1 April 2030 for the SRS . 40.There is currently no MEES that applies to the SRS . At the moment, providers must comply with the Decent Homes Standard ( DHS ), which sets a thermal comfort criterion broadly equivalent to EPC F. Government’s proposal is to introduce a standard for the first time and link this to the Thermal Comfort criteria in the DHS setting the standard at EPC C or equivalent by 2030. What is an Energy Performance Certificate ( EPC )? 41. EPCs are the method by which properties are assessed for energy efficiency. EPCs are currently provided by a qualified assessor using the Reduced Data Standard Assessment Procedure ( RdSAP ) which calculates how much energy a home uses (for example through heating or lighting) against what it loses (for example, through poor insulation) as well as considering the type of property, its age and construction. The assessor then gives the property a score out of 100 based on the assessment and assigns a rating from A to G, with A being the most efficient and G being the least efficient. A score of 100 on the EER metric displayed on existing EPCs means that there is no energy cost to the tenant. Properties that generate more energy than they use (for example, through solar panels) are given a score over 100. Alongside this score will be a ‘potential’ score and a list of potential improvements to the property as well as an estimated rating once these are completed. Figure 1: Sample Energy Performance Certificate Alt text: A domestic Energy Performance Certificate displaying a breakdown of a property’s energy efficiency. It includes a table listing features such as walls, roof, floor, windows, heating systems, hot water, and lighting, each rated from ‘Very Poor’ to ‘Very Good’. A section explains how energy performance affects energy bills, noting average heating needs and costs. Another section estimates heating costs to maintain a temperature. A color-coded bar chart shows the energy rating from A (most efficient) to G (least efficient), with the property rated C and scoring 78, with a potential score of 91. The certificate includes a placeholder for the address and validity details. Future EPC reform 42. The Reforms to the Energy Performance of Buildings Regime consultation published in December 2024 proposes that domestic EPCs use four headline metrics in future to assess energy performance and would replace the current EER methodology. We propose to use one or a combination of the revised metrics to set MEES for the social rented sector. These metrics are: The fabric performance metric – this would assess energy performance based on the fabric efficiency of the building and would provide recommendations that improve this. Possible measures could include insulation and double glazing. Installing these measures could improve thermal comfort, reduce heating demand, and enhance the efficiency of heating systems. Furthermore, appropriate fabric interventions could support a heat pump to work most efficiently in a home. The heating system metric – this would assess energy performance based on the efficiency and emissions of the building’s hot water and heating systems and potentially cooking appliances. This metric could rank different heating systems based on environmental impact, efficiency, and how well they align with achieving net zero emissions goals. It would incentivise energy efficient low-carbon options, such as heat pumps, over inefficient direct electric heating and carbon-intensive fossil fuel systems. In addition to heat pumps, possible measures recommended include heating controls, heat emitters (radiators), hot water cylinder upgrades, cylinder insulation, and solar water heating. The smart readiness metric – this would assess energy performance based on the optimisation of the building’s energy usage and its ability to integrate with a flexible energy system. Improving the smart readiness of the building would enable the occupier to use energy more efficiently to reduce their energy bills. Improving energy efficiency by potentially having access to smart-specific forms of renewable energy and providing tenants with information regarding their energy usage. Possible measures driven by this metric would include solar panels, batteries and other load shifting appliances, and smart meters to enable tenants to access smart tariffs and services that can enable residents to access cheaper rates for the energy that they use. The energy cost metric – this would most closely resemble the existing EER metric by assessing buildings based on the modelled energy costs per square metre. It would consider the energy costs for heating, hot water, lighting, pumps and fans for the building, but could also factor in the cost of the energy for cooking. Possible measures driven by this metric would include the fabric improvements mentioned above, more efficient gas boilers, and solar panels. 43. The EER, as the previous methodology, will no longer be used as the primary way of assessing energy performance, but it is planned to be displayed alongside new metrics during the transition period to ensure duty holders are clear about any compliance requirement they need to meet, either on current or future requirements. 44. This revised EPC design will help providers to comply with regulations that use EPCs and support retrofit decision-making. Government will provide further information on EPC design in due course. 45. Government will be able to give final confirmation of the grades for each metric that social rented homes would be required to meet to comply with MEES once the response to the HEM consultation is published and the design of the EPC metrics is finalised. Using post-reform EPCs to assess compliance with MEES 46. The existing EER cost metric and methodology for assessing compliance is well understood in the SRS and we know that most providers have either already met or plan to meet EPC C by 2030 using this metric. However, EPC reform provides an opportunity to use one or a combination of the new metrics as the basis for setting a MEES . This will enable MEES to better deliver its objectives of improving thermal comfort and health outcomes for tenants, reducing fuel poverty and helping decarbonisation. We plan to use a combination of the fabric performance, smart readiness or heating system metrics outlined above to set MEES . 47. It would theoretically be possible to set MEES based on the new energy cost metric (aligning mostly with current EPC headline metric, EER) that will be displayed on the post reform EPC certificate. However, we have chosen not to propose this in this consultation as there would be significant drawbacks to using this approach to set future MEES . Reasons for this are that energy price-based metrics can be affected by fluctuating energy prices without any additional work being undertaken on the building, or create anomalies that disincentivise low carbon heating adoption due to the higher unit costs of electricity compared to gas, which would undermine the aims of this policy. 48. However, for the purposes of demonstrating existing EPC C compliance, we expect that EER will remain as a legacy metric and be displayed on post reform EPC certificates for a period. Please see paragraphs 103 to 108 of this consultation on transition periods for more information on when this might be relevant. 49. Therefore, the Government preference is to apply one, or a combination of the new proposed alternative metrics: Fabric, Heating System or Smart Readiness as the new headline measure of energy efficiency. 50. We are seeking views on the following options, all using incoming EPC metrics: Option 1 (the government preferred option): Set a standard to meet a primary Fabric Performance metric and a secondary Smart Readiness or Heating System metric by 2030 Option 2: Meet a standard set against a Fabric Performance metric only by 2030. Option 3: Meet a standard set against specified dual metrics by 2030. Possible combinations are: Fabric Performance and Smart Readiness, or Fabric Performance and Heating System, or Smart Readiness and Heating System Option 4A: Meet a standard against an average of all three metrics, Fabric Performance, Smart Readiness and Heating System by 2030 Option 4B: Meet a standard against two of the three metrics, Fabric Performance, Smart Readiness and Heating System (at the landlord’s discretion of which two) by 2030. 51. The following implementation proposal information can be used to inform your metric proposal thinking. An overview of the government proposals has been outlined in the table below (Figure 2), with page references to each section for further information and accompanying analysis. Respondents should also consider how well the metrics, when considered alongside the implementation proposals, consider the issues around rural properties and the challenges they present. For example, where rural areas face challenges meeting MEES outside of their control, such as due to limited access to reliable broadband (necessary for operating smart meters) or where the installation of heat pumps may not be well-suited to older properties. Figure 2: Implementation Proposals Overview Implementation Proposals Paragraphs Time Limited Spend Exemption: Government proposes that there is a time-limited spend exemption for providers, meaning the maximum a provider would be required to spend to comply with MEES between now and 1 April 2030 is £10,000 per property. If the property still does not meet the minimum standard after the £10,000 expenditure, the exemption would allow providers to delay meeting the proposed minimum standard for a further 10 years from 2030. 91 to 103 Transition Period: Government proposes that social rented homes achieving EER C against existing EPCs, before new EPCs are introduced, would be considered compliant with the standard until those EPCs expire. We also propose Social rented homes that meet the existing EER C standard between the introduction of the new EPCs and 1 April 2028 would also be considered compliant with the proposed standard until their EPC certificates expire. 104 to 109 52. Respondents should note that, in the absence of detailed definitions, modelling of impacts in this consultation has been carried out with proxy definitions of the new EPC metrics and illustrative targets. These definitions and targets should not be taken as an indication of how the new EPC metrics or the higher standards for the SRS will ultimately be defined. Their use is solely to illustrate what can be achieved by basing SRS standards on the different elements of property performance (fabric performance, adoption of smart and energy generation technologies and heating performance) and to give a sense of the number of properties affected and the magnitudes of costs. 53. This approach has been taken to enable government to consult on SRS MEES as soon as possible, instead of delaying until after the conclusion of the EPC reform and HEM consultations. Please see pages 29 to 34 of the Impact Assessment, published alongside this consultation, for more information on how costs and benefits for different options for SRS MEES have been calculated. Options for assessing compliance: Option 1 (Government preferred option) – Dual metric approach: fabric performance with provider choice of heating system or smart readiness 54. Government’s preferred option for MEES is for providers to meet a standard for fabric performance first and then for providers to choose to meet either the smart readiness or heating system standard. This is in line with the proposals that were recently consulted on for the PRS . Focusing on fabric measures will improve the thermal comfort and overall decency of homes, reducing energy bills for tenants and reducing incidences of damp and mould. In practice, this means that providers would be required to prioritise investment in measures such as loft insulation, to achieve a fabric standard of EPC C. We anticipate this would align with most providers’ current business plans on fabric improvements. Upgrading the fabric of social homes will support providers to prioritise the thermal comfort of tenants and ensure properties are ready for the installation of low carbon heating systems as existing heating systems come to the end of their life. 55. Once the fabric standard is satisfied, providers would then have flexibility to choose whether to meet the smart readiness or heating system metrics by 2030. Both the fabric performance standard and the second metric standard (heat or smart) must be met by 2030. Using this dual metric approach incentivises measures such as solar installation or low carbon heating that will move us towards net zero and drive further bill reductions. Offering providers a choice of how they comply with the secondary metric allows providers to assess the condition of their housing stock and implement improvements according to a range of factors, including tenant preference, affordability and tenant outcomes. 56. A time-limited spend exemption, if put in place, would set out the maximum amount providers are required to invest in the property before being given additional time to meet MEES . Paragraphs 91-103 of this consultation sets out proposals for how the time-limited spend exemption would apply to MEES . Providers choosing smart readiness as the secondary metric 57. To achieve post-reform EPC C against the smart readiness metric, an EPC may recommend installing measures such as smart meters, solar panels, heat batteries, and other load-shifting appliances. These measures would improve the flexibility of the building’s energy demand, enabling the tenant to improve the efficiency of their energy use, which when coupled with fabric measures may help to maximise energy bill savings for the tenant, supporting overall fuel poverty reduction ambitions. 58. As the final definition of the smart readiness metric and measures that would contribute to meeting EPC C through this metric are not yet available, modelling presented has assumed that a smart metric would require installation of Photovoltaic (PV) Solar for the purposes of cost analysis and respondents should consider this a proxy metric for the basis of their responses. Clarity on what this metric will include will be provided on conclusion of HEM and EPC reform consultation and outcomes. See page 19 of the Impact Assessment for more information on how this metric has been modelled. Providers choosing the heating system as the secondary metric 59. To achieve EPC C against the post-reform EPC heating system metric, an EPC may recommend installing a heat pump, improving heating controls or improving radiators. These measures would enable the low carbon heating to be installed which, coupled with fabric measures, should help ensure the heating system is operating efficiently and on an affordable basis. 60. As the final definition of the heating system metric or what measures would likely contribute to meeting EPC C against the metric are not yet available, government has assumed that a heat metric would require installation of an air source heat pump or equivalent for the purposes of cost analysis. Respondents should consider this a proxy metric for the basis of their responses. See page 19 of the Impact Assessment for more information on how this metric has been modelled. 61. Figure 3 below shows the decision points for providers and worked examples based on the above. These have been provided for illustrative purposes only; decisions will depend on the final metric definitions under HEM and the choices providers make to comply with MEES . Figure 3: Preferred option (Option 1) flow chart Please see Annex C for illustrative examples of how this option may work in practice. Alt text: A flow chart showing steps for providers to comply with the Government’s preferred MEES metric option. It starts with obtaining a new EPC certificate outlining required measures. Providers assess the property and install measures to meet the fabric performance standard. After meeting the fabric standard first, providers choose to meet the standard against either the smart readiness or heating system standard. If providers then meet the standard, no further action is needed. If providers have spent the spend exemption amount and have not met the standard, they refer to the spend exemption. A note clarifies that the spend exemption is not a spending cap and providers can spend over this amount. Option 1: Costs and outcomes 62. Our initial analysis estimates that this option, depending on other decisions regarding implementation, would cost between £4,500 to £5,300 per property. It could achieve average annual bill savings across all homes treated of between £96 to £165 for tenants by 2030, taking between 347,000 and 401,000 homes out of fuel poverty. This option could support the highest number of homes, treating between 1,671,000 and 2,091,000 households (See Figure 8 below which compares each option under consideration). 63. As outlined previously, there is some uncertainty in the modelling due to precise definitions of post- EPC reform metrics not yet being available. The final cost would also depend on which secondary metric is chosen by providers to comply with MEES . To ensure modelling covers the range of approaches that may be taken by providers in this scenario, the lower range is based on social housing providers meeting a secondary smart readiness metric and the higher range is based on providers taking a 50/50 split between choosing either the heating system or smart readiness as the secondary metric. See page 23 of the Impact Assessment for more information on how government’s preferred option for MEES has been modelled. Option 2 – Single metric approach: fabric performance 64. This option would require providers to focus works on improving the fabric efficiency of the property only. For example, this could include cavity wall insultation, double glazing for windows, loft insultation. These would be similar measures to those currently take to achieve EPC C using the existing EER methodology. 65. Focusing solely on fabric would ensure that social housing is at a sufficient standard before providers install low carbon heating or smart measures. However, this comes with smaller fuel poverty reductions, bill savings and carbon savings compared to options that require a secondary standard to be met. Figure 4 below shows the decisions a providers may take: Figure 4: Option 2 (Single Fabric Metric) flowchart Please see Annex C for illustrative examples of how this option may work in practice. Alt text: A flow chart showing steps for providers to comply with MEES by meeting a single fabric performance metric only. It begins with obtaining a new EPC indicating required measures against the fabric metric. Providers assess the property and choose measures to implement, such as new windows or loft insulation. After completing the work to achieve EPC C against the fabric metric, providers check if the standard is met. If yes, no further action is needed. If providers have spent the spend exemption amount and have not met the standard, they refer to the spend exemption. A note clarifies that the spend exemption is not a spending cap and providers can spend over this amount. Option 2: Costs and outcomes 66. Although a single fabric metric would be less impactful in reducing carbon emissions compared to other options, appropriate fabric interventions could support a heat pump to work most efficiently in a home. 67. Our analysis indicates that depending on where the time-limited spend exemption is set (see paragraphs 91 to 103 of this consultation) it would cost on average £3,653 per property to comply with the standard, the cheapest of all approaches proposed. This would reduce household bills by up to £150 per annum on average, taking up to 269,000 homes out of fuel poverty. See page 38 of the Impact Assessment published alongside this consultation for analysis of the impacts of Option 2. Alternative approaches to setting the standard against dual metrics 68. The government is aware that there are other approaches to setting a dual metric standard or areas where providers may wish to have additional flexibility in terms of how to meet the new standard. Therefore, we also wish to seek views on alternative approaches to using combinations of these new metrics to set a new standard. Government would welcome views on these alternative options and any other proposals respondents have. 69. Due to the uncertainty in the precise definitions of future EPC metrics and provider intention, we have been unable to provide indicative costs and outcomes for Options 3, Option 4A and Option 4B. Further assessment would be undertaken if any of these options were to be taken forward. Option 3 – A requirement to meet a standard set against specified dual metrics 70. This option is also a dual metric approach which would require providers to meet a standard set against two specified metrics without the government expressing a preference of which to do first. This differs from the preferred option by not requiring fabric performance works first, giving providers discretion to choose which metric to prioritise. The three possible variations of this option are: The fabric performance and smart readiness metrics – this could maximise the number of cost-saving measures installed, resulting in greater bill reductions and fuel poverty alleviation. However, low carbon heating systems would not be recognised under this approach The fabric performance and heating system metrics – this could enable low carbon heating systems whilst ensuring buildings have a sufficient level of thermal comfort and lower heat loss to allow the heating system to be operated efficiently and affordably The smart readiness and heating system metrics – this could enable low carbon heating systems whilst ensuring the potential higher costs of operating the heating system are offset by savings through the use of measures such as solar panels, heat batteries, and access to time-of-use tariffs. Figure 5: Option 3 flow chart Alt text: A flow chart showing steps for providers to comply with MEES by meeting a dual metric option where government would specify which metrics must be met. It begins with obtaining a new EPC . Possible dual combinations government could set the standard at include: the fabric performance and smart readiness metrics, the fabric performance and heating system metrics or the smart readiness and heating system metrics. Providers assess the property and choose their approach to meeting the specified dual standard. After completing the necessary work, providers check if the standard has been met. If yes, no further action is needed. If providers have spent the spend exemption amount and have not met the standard, they refer to the spend exemption. A note clarifies that the spend exemption is not a spending cap and providers can spend over this. 71. With this approach, there would be no requirement for the provider to prioritise a specified metric first. However, there is a risk that, if the provider cannot install all recommended measures to meet the standard within the proposed spend exemption (see paragraphs 91 to 103 of this consultation), the measures that are installed may not be the most effective in maximising energy use potential or in reducing the fuel costs to benefit residents compared to Option 1. For example, with standards set using the fabric performance metric and heating system metric, providers may opt to first invest towards low carbon heating systems. This could then lead to the landlord only needing to invest a small amount further to improve the fabric performance of the building under the spend exemption. In such a circumstance, the building’s fabric may not be improved sufficiently to ensure the heating system is operating as efficiently and affordably as possible, limiting reductions in fuel bills. Please see Annex C for illustrative examples of how the options may work in practice. Option 3: Costs and outcomes 72. Given that the impact of the dual metric option will depend on choice of metrics and the order in which works are completed, the costs and benefits of meeting each single-metric option has been presented in the Impact Assessment for simplicity (see page 41 of the Impact Assessment). These impacts should be viewed as maximal impacts from all providers meeting that standard. Therefore, to interpret the impact of a dual metric option, the relevant single-metric options should be considered in parallel. For example, we estimate that meeting a fabric-only option (with a £10,000 spend exemption) would cost the sector £2.6 billion, treating 874,000 homes and removing 269,000 homes out of fuel poverty. Whereas, meeting a smart readiness only option (with a £10,000 spend exemption) would cost the sector £8.1 billion, treating 2.03 million homes and removing 401,000 homes out of fuel poverty. Therefore, outcomes of dual metric combinations would sit between the two modelling scenarios selected. For example, for a dual fabric performance and smart readiness metric combination, it is estimated overall cost to the sector would be between £2.6 billion (fabric performance only costs) and £8.1 billion (smart readiness only costs). Options 4A and 4B – Allowing providers maximum flexibility in which standards they meet 73. Some providers may wish for additional flexibility to install measures according to the needs of their housing stock. For example, it may be challenging to install additional insulation in a property but appropriate to install solar panels and a new heating system. We have considered two ways providers could meet MEES flexibly below. Option 4A – Providers would need to meet an average standard, set at EPC C or equivalent, across the three metrics (fabric, smart and heat). A provider could choose to meet EPC A or equivalent on one metric, and EPC D on the other two and still meet MEES , depending on where an average standard is set. This option would need to be developed further following the outcomes of EPC reform consultation. Option 4B – A minimum standard equivalent to band C is set against all three metrics, allowing the provider to choose two metrics to meet MEES for each property. This means that providers could choose any combination of the three proposed metrics rather than this being prescribed by government. 74. The increased flexibility in these options means that the benefits to residents and carbon savings would be highly dependent on provider’s retrofit decisions. Figure 6: Option 4A flowchart Alt text: A flow chart showing steps for providers to comply with MEES by meeting an average standard set at EPC C or equivalent across three metrics: the fabric performance, smart readiness, and heating system metrics. It begins with obtaining a new EPC indicating required measures for each metric. Providers assess the property and plan their approach to achieving the average EPC C rating. After completing the necessary work, providers check if the standard is met. If yes, no further action is needed. If providers have spent the spend exemption amount and have not met the standard, they refer to the spend exemption. A note clarifies that the spend exemption is not a spending cap and providers can spend over this. Figure 7: Option 4B flowchart Alt text: A flow chart showing steps for providers to comply with MEES by meeting EPC C or equivalent on any two out of three metrics: the fabric performance, smart readiness, and heating system metrics. It begins with obtaining a new EPC indicating required measures for each metric. Providers assess the property and choose two metrics to target. After completing the necessary work, providers check if the standard has been met. If yes, no further action is needed. If providers have spent the spend exemption amount and have not met the standard, they refer to the spend exemption. A note clarifies that the spend exemption is not a spending cap and providers can spend over this. See the Annex C for illustrative examples of how these options may work in practice. Options 4A and 4B: Costs and outcomes 75. Due to the uncertainty in the precise definitions of future EPC metrics and provider intention, we have been unable to provide indicative costs and outcomes for these options (4A and 4B), but we anticipate that the benefits of this option would fall within the broad range of costs outlined for the preferred option (fabric plus heat or smart). There is less certainty about outcomes due to a wide range of potential measures or combination of measures that would be installed. A more precise methodology for decision making under either Option 4A or 4B would be provided along with cost information should this option be taken forward. Comparing the options 76. As outlined above, government’s preferred approach for setting a MEES for the SRS is to require providers to meet a dual metric standard, with a primary fabric performance standard and then a choice of a secondary standard, either smart readiness or heating system (Option 1). Given the prevalence of fuel poverty in the SRS , it is important that government’s approach drives a consistent level of thermal performance across the sector as a primary outcome which is why we have prioritised the fabric metric. Improving the fabric of a building will mean that low carbon heating systems such as heat pumps and heat networks are able to run more efficiently and with lower running costs for tenants. 77. Having a choice of secondary metric will give providers a flexible approach to assess the best way to meet the standard based