Everyone knows EPCs need improvement, says Tom Lowe, Founding Director of Thermal Storage UK. Here, he sets out what works, what needs reforming and how they can become a tool to mark our decarbonisation progress.
Energy Performance Certificates (EPCs) increasingly underpin all government heat and building policy. An EPC can prevent poorly insulated homes being rented out, is part of the criteria for the Energy Company Obligation and is needed to access the Boiler Upgrade Scheme. Yet everyone working in energy knows that EPCs require improvement. So it is welcome that the UK government has committed to finish the work started in 2018 and led to an EPC Action Plan way back in 2020.
Before getting into what needs to be reformed, there are positives to EPCs. They are easily recognisable and can help people see whether a building is very energy efficient or inefficient before purchasing or renting. EPCs focus on the building fabric and the installed technologies, rather than how the current occupants heat the building or live their lives. The assessment is non-invasive (there’s no drilling into walls looking for insulation), speedy and reasonably cost-effective. And the data is broadly comparable across all buildings.
The downsides of EPCs
However, there are obvious drawbacks to EPCs. For instance, the Reduced Data Standard Assessment Procedure (rdSAP) software model behind EPCs does not currently consider the flexibility of a building. This means that EPCs ignore the flexibility of batteries, thermal storage, EV charging and heat pumps. That is a problem as we electrify heat and transport and people switch to time-of-use and type-of-use tariffs with overnight charging.
As the energy transition speeds up, we are seeing significant technological change and improvements to heat pumps, thermal stores, batteries and EVs. Yet the process for adding innovative technologies to rdSAP is bureaucratic, with companies required to go through something called the Appendix Q process.
While heating makes up the largest single component of energy bills, Domestic Energy Assessors (DEAs) are not generally trained heating engineers and so may not recognise different heating systems. rdSAP makes this easier for the DEAs by using a Gas Council (GC) identification code for gas boilers. Such a system does not exist for heat pumps or other electrical heating systems. And DEAs may not spot and understand heating controls or be able to assess whether the heating system is operating efficiently.
This reflects a wider problem that the data underpinning EPCs is not updated frequently enough. At the moment, the carbon emissions and Primary Energy Factors used in EPCs date from 2012. This means that rdSAP still thinks the UK’s electricity generation mix includes a lot of coal power plants (most of which are now demolished).
As EPC assessments are non-invasive, DEAs must rely on what they can see or the building owner can prove. If the owner insists they installed loft insulation but there is no safe access, the DEA has to input into rdSAP that the loft insulation is “as built”. The same goes for underfloor insulation or internal wall insulation. But building owners don’t know that they should take photos of this work or retain any certificates.
Opportunities for EPC reform
These drawbacks provide ample opportunities for reform. The UK government could take the following steps in the 12 months before autumn 2024:
- Incorporate flexibility into EPCs, for instance by adjusting the Primary Energy Factor to reflect the use of products that can provide flexibility.
- Make it easier to add new technologies to rdSAP by reforming the Appendix Q process.
- Introduce an identification code into rdSAP for heat pumps and other electric heating systems, mirroring the GC code for gas boilers.
- Train Domestic Energy Assessors on new heating systems and heating controls.
- Update the Primary Energy Factors of rdSAP to reflect the UK’s existing and forecast electricity generation mix.
- Provide online tools for people to record information about any fabric improvements such as wall or underfloor insulation.
Reformed EPCs will help to inform people about the energy efficiency of their building and what steps to take. They will provide information to banks and building society lending for mortgages and trying to decarbonise their portfolio. And they will help the UK government to achieve its objective of cutting energy use by 15% by 2030.
To encourage this investment requires certainty from the government on policy timeframes. That is why businesses want to see SAP 11 and the Future Homes Standard introduced and clear timelines for improving the energy efficiency of properties, rebalancing policy costs between electricity and gas and moving away from fossil fuel heating.
Ultimately, we need to decarbonise 300 homes every hour every working day for the next 27 years through energy efficiency and new heating systems. Doing so brings lower bills and more comfort to people and businesses. Reforming EPCs are a tool to mark our progress but the main work is to get out there installing.