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EPC ratings: what they mean for hospitality premises

An Energy Performance Certificate rates a building's energy efficiency from A (most efficient) to G (least), and you generally need one to let a commercial premises. For hospitality premises - which are energy-intensive - the rating matters both as a legal requirement to let and as a signal of how efficient, and how costly to run, the building is. Here is what EPC ratings mean for hospitality premises. This is general information, not legal advice.

EPC
Rates efficiency A to G
To let
You generally need one
Minimum
There is a minimum to let
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The short answer

An EPC rates a building's energy efficiency from A to G; you generally need one to let commercial premises, and under the Minimum Energy Efficiency Standards there is a minimum rating (currently E) below which you cannot lawfully let - a minimum set to rise over time - so for hospitality premises the EPC is both a compliance matter and a running-cost signal

An Energy Performance Certificate (EPC) is a rating of a building's energy efficiency, on a scale from A (most efficient) to G (least efficient), produced by an accredited assessor. For commercial (non-domestic) property, you generally need a valid EPC when the building is built, sold or let - so a landlord letting a hospitality premises normally needs one. Beyond simply having an EPC, the Minimum Energy Efficiency Standards (MEES) set a minimum rating below which a property cannot lawfully be let: the minimum is currently E, and since 2023 this applies not just to new lettings but to continuing ones, so a let property below E can put the landlord in breach. The minimum is set to rise over time (proposals move it up toward C and then B over the coming years), which means buildings that only just meet the current minimum may need improving to keep being lettable. Enforcement is by local authorities, with civil penalties scaled to the property's rateable value, so non-compliance carries a real cost. For hospitality premises specifically, the EPC matters for two reasons. First, compliance: a hospitality landlord or tenant needs to know the building meets the minimum to let it lawfully, and to plan for the rising minimum. Second, running cost: hospitality premises - especially those with commercial kitchens - are energy-intensive, so the building's energy efficiency (which the EPC rates) affects how costly it is to run; a poorly rated building tends to cost more in energy. So for hospitality premises the EPC is both a legal requirement tied to a minimum standard, and a signal of the building's efficiency and running cost - both of which matter to whoever occupies or lets it. (This is general information; specific obligations should be checked against current regulations and professional advice.)

Key points

The short version

  • An EPC rates a building's energy efficiency from A (best) to G (worst).
  • You generally need a valid EPC to let a commercial premises.
  • There is a minimum rating to let - currently E - under the MEES rules.
  • The minimum is set to rise over time, so weaker ratings may need improving.
  • Hospitality premises are energy-intensive, so efficiency affects running costs too.

What an EPC is

A rating of energy efficiency

An Energy Performance Certificate is a document that rates how energy-efficient a building is, on a standard scale from A to G, where A is the most efficient and G the least. It is produced by an accredited energy assessor, who assesses the building's fabric and services - its construction, insulation, heating, lighting and so on - and calculates a rating and a numerical score. The certificate also usually includes recommendations for improving the rating. The point of the EPC is to give a standardised, comparable measure of a building's energy efficiency, so that its efficiency (and, by implication, its likely energy cost and carbon impact) can be seen and compared. For commercial property, the EPC is the recognised measure of the building's energy performance used in law and in transactions.

For hospitality premises, the EPC rates the building itself - its fabric and fixed services - rather than the tenant's catering equipment or how the kitchen is operated day to day. So the rating reflects things like the building's insulation, its heating and cooling, its lighting and its fixed building services, as assessed by the methodology. This is worth understanding, because it means the EPC is primarily about the premises as a building, and improving it is largely about the building's fabric and fixed services (insulation, heating, lighting and so on). The kitchen's operational energy use - how efficiently the equipment is run and maintained - is a separate matter that affects running cost but is managed operationally rather than through the EPC. Both matter for a hospitality business's energy cost, but they are different things: the EPC rates the building; operational efficiency is about how it is used.

Why you need one

Required to let

The main reason EPC ratings matter legally is that you generally need a valid EPC to let a commercial premises (as well as to sell or on construction). So a landlord letting a hospitality building normally needs to have a valid EPC in place - it is part of the compliance of letting the property. This is the baseline requirement: not just any state of efficiency, but a certificate showing what the efficiency is. Beyond having the certificate, though, the more significant requirement is the minimum standard that goes with it, which is what can actually prevent a building being let.

That minimum comes from the Minimum Energy Efficiency Standards (MEES), which set a floor below which a property cannot lawfully be let. The current minimum is an E rating - a property rated F or G is, subject to exemptions, below the standard and cannot lawfully be let. Importantly, since 2023 this applies to continuing lettings, not only new ones, so a building that is already let but sits below the minimum can put the landlord in breach - it is not enough to have met the standard only at the start of a lease. So for a hospitality premises the EPC is tied to a minimum standard that must be met to let the building lawfully, on an ongoing basis. This is why the rating is not just informational but a compliance threshold: fall below it, and the property may not be lawfully lettable until it is improved or an exemption applies.

The rising minimum

The standard is tightening

The minimum standard is not fixed - it is set to rise over time. The current minimum of E is proposed to increase in stages over the coming years, moving the required rating up (proposals point toward C and then B), so that buildings will need to be more efficient to remain lettable. The exact dates and details are set by regulation and have been subject to consultation and change, so they should be checked against the current rules rather than assumed - but the clear direction is that the minimum is tightening. This matters for hospitality premises because a building that only just meets the current E minimum may fall below a future higher minimum, and so may need improving - upgrading the fabric or services - to keep being lettable as the standard rises.

The practical implication is to look ahead, not just at the current position. A landlord or occupier of a hospitality premises with a weak EPC rating (E, or close to it) should be aware that the minimum is expected to rise and plan accordingly - understanding what improvements would raise the rating, and when they might be needed. Improving a building's EPC rating is generally about the fabric and fixed services (better insulation, more efficient heating, lighting and building services), which the EPC recommendations usually indicate. So the EPC is not just a snapshot to satisfy today's requirement but a forward-looking matter: the rising minimum means efficiency improvements may be needed over time, and it is better to plan for them than to be caught below a new threshold. Because the specifics are governed by regulation that can change, current professional advice is the right basis for any decision.

Penalties

The cost of non-compliance

Non-compliance with the minimum standard carries a real cost. Enforcement is by local authorities, and the penalties for letting a property below the minimum (without a valid exemption) are civil penalties scaled to the property's rateable value, which for a commercial premises can be substantial - the penalties rise with the length of the breach and the rateable value. So letting a hospitality premises that is below the minimum, or failing to have a valid EPC where one is required, is not a technicality without consequence: it can lead to significant financial penalties, as well as the practical problem that the property may not be lawfully lettable.

This is why the EPC and the minimum standard are worth taking seriously as a compliance matter, not just an administrative formality. For a landlord, it means ensuring any hospitality premises being let has a valid EPC and meets the current minimum, and planning for the rising minimum. For a tenant, it can matter too - understanding the building's rating, its running-cost implications, and any improvements that may be needed during the lease. The scaled penalties mean the downside of getting it wrong is real, so it is worth knowing where a premises stands. As with all of this, the specific obligations and penalty levels are set by regulation and should be confirmed against the current rules and professional advice - this guide is general information to explain what EPC ratings mean and why they matter, not a substitute for that advice.

The running-cost side

Efficiency and kitchen energy

Beyond compliance, the EPC rating is a signal of the building's energy efficiency, which matters for running cost - and for hospitality premises this is significant, because they are energy-intensive. A hospitality building, especially one with a commercial kitchen, uses a lot of energy: cooking, refrigeration, extraction, hot water, heating and lighting all draw energy, often heavily. So the efficiency of the building - how well it retains heat, how efficient its services are - affects how much that energy costs. A poorly rated building tends to be more costly to run; a better-rated one, more efficient and cheaper. So the EPC is not only a compliance threshold but a rough indicator of the building's running cost, which is a real concern for an energy-intensive hospitality operation.

It is worth being clear about what the EPC does and does not capture, though, because it affects how you manage energy cost. The EPC rates the building - its fabric and fixed services - not the kitchen's operational energy use. So while improving the EPC (fabric and services) helps the building's baseline efficiency, a large part of a hospitality kitchen's actual energy cost comes from how the equipment is run and maintained, which sits outside the EPC. Keeping extraction degreased, refrigeration condensers clean, and equipment well maintained cuts the operational energy use - clogged extraction and dirty refrigeration make equipment work harder and use more energy. So managing a hospitality premises's energy cost has two parts: the building's efficiency (which the EPC rates, improved through fabric and services) and the kitchen's operational efficiency (which the EPC does not rate, improved through good operation, cleaning and maintenance). Both matter; the EPC covers the first, and good kitchen practice - including keeping the equipment clean and efficient - covers the second.

Questions

Frequently asked questions

What is an EPC?

An Energy Performance Certificate - a rating of how energy-efficient a building is, on a scale from A (most efficient) to G (least), produced by an accredited assessor who assesses the building's fabric and fixed services (construction, insulation, heating, lighting and so on). It gives a standardised, comparable measure of the building's energy efficiency, and usually includes recommendations for improving the rating. For commercial property you generally need a valid EPC when the building is built, sold or let. So for a hospitality premises the EPC is the recognised measure of the building's energy performance used in law and transactions. It rates the building itself, not the tenant's catering equipment or how the kitchen is operated - those affect running cost but are managed separately. This is general information, not legal advice.

Do I need an EPC to let a hospitality premises?

Generally yes - you normally need a valid EPC to let a commercial premises (as well as to sell or on construction), so a landlord letting a hospitality building normally needs one in place. But beyond simply having the certificate, there is a minimum standard that must be met to let: under the Minimum Energy Efficiency Standards (MEES) a property below the minimum rating cannot lawfully be let (subject to exemptions). So the requirement is twofold: have a valid EPC, and meet the minimum standard. The specific obligations are set by regulation and should be confirmed against the current rules and professional advice - this is general information. The key point is that letting a hospitality premises normally requires both a valid EPC and a rating at or above the minimum standard.

What is the minimum EPC rating to let?

Currently E, under the Minimum Energy Efficiency Standards (MEES) - a property rated F or G is, subject to exemptions, below the standard and cannot lawfully be let. Since 2023 this applies to continuing lettings, not just new ones, so a property already let but below the minimum can put the landlord in breach - meeting the standard only at the start of a lease is not enough. Importantly, the minimum is set to rise over time (proposals move it up toward C and then B over the coming years), so buildings that only just meet the current E may need improving to remain lettable. The exact dates and details are set by regulation and have changed, so they should be checked against the current rules rather than assumed. The direction, though, is clear: the minimum is tightening.

Is the minimum standard going to change?

Yes - the minimum is set to rise over time. The current E minimum is proposed to increase in stages, moving the required rating up (toward C and then B) so that buildings will need to be more efficient to remain lettable. The exact dates and details are governed by regulation and have been subject to consultation and change, so they should be checked against the current rules rather than taken as fixed - but the clear direction is a tightening minimum. For a hospitality premises this means looking ahead: a building that only just meets the current E may fall below a future higher minimum and need improving (upgrading fabric or services) to keep being lettable. So it is worth understanding what improvements would raise a weak rating and planning for when they might be needed, rather than being caught below a new threshold. Current professional advice is the right basis for any decision.

What happens if a premises is below the minimum?

Letting a property below the minimum (without a valid exemption) is non-compliant, and enforcement is by local authorities with civil penalties scaled to the property's rateable value - which for a commercial premises can be substantial, rising with the length of the breach. So it is not a consequence-free technicality: it can lead to significant financial penalties, and the practical problem that the property may not be lawfully lettable until improved or an exemption applies. This is why the EPC and its minimum standard are worth taking seriously. For a landlord it means ensuring any let hospitality premises meets the current minimum and planning for the rising one; for a tenant it can matter for running cost and for improvements needed during the lease. The specific penalty levels are set by regulation and should be confirmed against the current rules and professional advice.

How does the EPC relate to my kitchen's energy cost?

The EPC rates the building's efficiency (fabric and fixed services), which affects the building's baseline running cost - and hospitality premises are energy-intensive, so a poorly rated building tends to cost more to run. But the EPC does not rate the kitchen's operational energy use - how efficiently the equipment is run and maintained - which is a large part of a hospitality kitchen's actual energy cost. So managing energy cost has two parts: the building's efficiency (which the EPC rates, improved through fabric and services) and the kitchen's operational efficiency (outside the EPC, improved through good operation, cleaning and maintenance). Keeping extraction degreased, refrigeration condensers clean and equipment well maintained cuts operational energy use, because clogged extraction and dirty refrigeration make equipment work harder. So the EPC covers the building; good kitchen practice covers the operation - both matter for the total energy cost.

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