The government has confirmed how it intends to raise minimum energy efficiency standards in the private rented sector: a higher standard for all tenancies by 1 October 2030, with investment capped at £10,000 per property.
The detail arrived in the government response published on 21 January 2026, and none of it has been scrapped.
One thing to be clear about, because plenty of commentary gets it wrong in the other direction: at the last check, in September 2026, this was confirmed policy, not law in force. No bill to deliver it had been introduced to Parliament.
In short
- The government has confirmed a higher EPC standard for all tenancies by 1 October 2030, with investment capped at £10,000 per property.
- At the last check, in September 2026, this was confirmed policy, not law in force; no bill to deliver it had been introduced.
- Properties valued below £100,000 get a lower cap of 10% of value where that is less than £10,000.
- A home that reaches C or better before 1 October 2029 is treated as compliant until that EPC expires.
- The maximum fine rises from £5,000 to £30,000 per property per breach.
What EPC C by 2030 requires
The government response sets out a dual-metric standard measured against new EPC metrics rather than the single rating landlords are used to.
“EPC C” is shorthand. The government says it will confirm how the target of C will look on the new EPCs once the new bands are settled, and a C on today’s rating counts only through the grandparenting clause set out below.
The primary requirement is a fabric performance standard. Alongside it, landlords choose between a smart readiness metric or a heating system metric.
- Fabric performance measures how well the building holds its temperature, driven by insulation, window quality and airtightness.
- Smart readiness assesses the home’s potential to generate its own energy, usually from solar panels, and to use smart technology to cut electricity bills.
- The heating system metric assesses the technology that heats the home and its hot water, on its efficiency and emissions.
Investment is capped at £10,000 per property. The government’s own impact assessment estimates average spend will come in lower, at around £5,400.
Third-party funding counts towards the cap, with Boiler Upgrade Scheme grants excluded.
There is a separate, lower cap for cheaper stock. Under a Property Value Adjustment, properties valued below £100,000 have investment capped at 10% of property value where that is lower than £10,000.
For anyone buying at the cheaper end of the market, that materially changes the exposure.
Confirmed policy is not the same as law
This distinction is the whole of the risk assessment.
The government response says the legislative changes it describes will be subject to Parliamentary approval.
Delivering them requires new powers in primary legislation, followed by secondary legislation confirming the target, which the government aims to bring into force in 2027. Compliance would then bite on 1 October 2030.
So the correct status today is: confirmed government intention with a published design, awaiting an Act and a statutory instrument.
Anyone telling you EPC C is already a legal requirement for lettings is wrong, and anyone assuming it will therefore quietly disappear is taking a position the published policy does not support.
The metric detail is still moving too.
The new Home Energy Model EPCs were originally aimed at October 2026, a timeline the government itself called ambitious, and in March 2026 it moved the launch to the second half of 2027, with the exact date still to be agreed.
The consultation setting the new band boundaries closed on 18 March 2026, and at the last check, in September 2026, no response had been published. Until both land, nobody can tell you the precise score a property will need.
Enforcement is being re-armed alongside it.
The maximum fine rises from £5,000 per property today to £30,000 per property per breach, with fines also available for registering false exemption information.
Treat it the way you would treat any policy at this stage: do not pay for it as though it were certain, and do not underwrite as though it will not happen.
The EPC grandparenting clause
Buried in the exemptions is the most commercially useful item in the document.
A private rented home that achieves C or better against the Energy Efficiency Rating on an existing or new EPC before 1 October 2029 is treated as compliant with the higher standard until that EPC expires or is replaced.
EPCs run for ten years. A C rating lodged under the current metric before that date therefore carries a property well past the 2030 deadline without the new dual-metric assessment applying.
That is a genuine planning lever, and it has a date on it.
The exemptions themselves are extensive, with eight categories in total. The property value adjustment exemption also lasts ten years, and the government says the others are typically valid for five years unless it specifies otherwise. Four of the named categories and their durations are:
| Exemption | Duration |
|---|---|
| Cost cap, once £10,000 has been spent | Ten years |
| Negative Impacts, where a measure would harm the property | Ten years |
| Solid wall insulation opt-out and third-party consent | Five years |
| New landlords | Six months |
Exemptions are not a way out, though. When one expires the obligation to invest returns.
What this means for property investors
Check the EPC expiry date on everything you own or are buying. It is now a date that carries money. A property at C with a certificate lodged before October 2029 is in a different position from an identical one whose certificate lapses in 2028 and must be redone under the new metrics.
Price the cap into older and solid wall stock. Victorian terraces, solid wall construction and anything currently at D or below should be underwritten with up to £10,000 per unit of eventual spend, tempered by the average estimate of £5,400 and by the solid wall exemption. On a block, that is a per-property cap applied repeatedly, so a ten flat building is a very different number from a single house.
Cheap stock has a lower ceiling than people assume. The 10% adjustment below £100,000 means a £70,000 terrace carries a £7,000 cap rather than £10,000. That does not make the work free, but it does mean the doomsday arithmetic applied to cheap stock is often overstated.
On rental stock the rating is worth more than the headlines suggest. This is where a lot of commentary gets it backwards. Nationwide research published in June 2026 found only a 1.6% price premium for an A or B rated home over a D rated one, widely quoted as evidence that efficiency does not pay. It measures owner-occupied sales. A separate Spring 2026 report from The Mortgage Works, Nationwide’s buy-to-let lending arm, found an A or B rating attracts a materially larger premium on buy-to-let purchases than the 1.6% seen in owner-occupied sales, so if you are buying to let, the owner-occupier number is the wrong comparator. Both publishers are lenders with a commercial interest in EPC-linked lending, so treat the direction as more reliable than the decimal point.
Do not overpay a discount for EPC risk that is already resolved. Vendors and buyers are both pricing this vaguely. A property already at C with a recent certificate has less exposure than the market is discounting for, and that gap is worth finding. The same discipline applies to HMOs.
Watch for the legislation, not the headlines. The thing to track is the primary legislation and the statutory instrument targeted for 2027. The Decent Homes Standard is arriving on a separate, later timetable for the same stock, so price the two obligations together rather than treating EPC C as the only capital call ahead. Until those land, the design can change.
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BlackBook Investments is a property investment broker, not a mortgage, tax or investment adviser. Nothing here is a recommendation on any product or on your position. Take regulated advice before acting.