The Government is preparing major changes to the energy efficiency requirements for rental properties across England and Wales. These proposals form part of a wider push to make homes warmer, greener, and more affordable to run.

Although the plans are still subject to consultation, landlords and tenants may wish to be aware of what is being considered and how it could shape the rental market over the coming years.

What the Government is proposing

The central proposal is to raise the minimum Energy Performance Certificate (EPC) rating for privately rented homes. Under the current rules, properties must achieve at least an E rating. The Government is exploring an increase to a stricter C rating for new tenancies from 2028, with all existing tenancies to be included by 2030¹.

This represents a significant shift and could mean substantial upgrades for many rental homes, particularly older properties. The aim is to reduce household energy use, improve warmth and comfort, and support the UK’s long-term environmental targets¹.

A new way of assessing energy performance

Alongside the higher targets, the EPC system is being reviewed. The existing methodology is based on estimated running costs, which can disadvantage homes that use electricity for heating—even when using efficient modern heat pump systems.

A revised system is expected to look more closely at actual building performance. This may include:

• heating systems and insulation
• heat loss indicators, window performance and draught-proofing
• the impact of new technologies, such as smart meters and home energy monitoring

The intention is to create a more accurate picture of a property’s efficiency.

2030: A challenging target for landlords

If the proposals go ahead, the scale of change required is considerable. Industry analysis suggests a large proportion of rental homes would need improvement works to reach a C rating.

A range of upgrades may be necessary. These could include improving insulation, replacing older windows, or upgrading heating systems. Landlord surveys indicate that many expect to face costs ranging from a few thousand pounds to much more for extensive work².

While the initial investment may be significant, energy-efficient properties tend to have lower running costs and may be more attractive to tenants.

Potential benefits for tenants

Tenants could see longer-term advantages if these rules are introduced. Energy-efficient homes typically benefit from²:

• lower heating bills
• increased comfort during colder months
• fewer issues with damp and condensation

Industry research has suggested that the difference between a lower-rated and higher-rated rental home could amount to hundreds of pounds per year in energy savings.

As energy bills remain a concern for many households, these improvements may offer valuable relief.

What happens next?

The Government’s consultation closed earlier this year. Final decisions, including any spending caps and timelines for implementation, are expected in due course¹.

Once confirmed, landlords will have clarity on what is required and when upgrades must be in place. Many may choose to review their properties in advance so they can plan any necessary work in an organised and cost-effective way.

References:

1. GOV.UK  (2025). Improving the energy performance of privately rented homes: 2025 update. Available at: https://www.gov.uk/government/consultations/improving-the-energy-performance-of-privately-rented-homes-2025-update   [Accessed 25 Nov. 2025].
2. NewsAgent (2025). New EPC Regulations 2025: How to Save your Landlords Thousands. Available at: https://blog.goodlord.co/new-epc-regulations      [Accessed 25 Nov. 2025].

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‌Your home/property may be repossessed if you do not keep up repayments on a mortgage or other debt secured on it.

All the information in this article is correct as of the publish date 27^th November 2025. The opinions expressed in this publication are those of the authors. The information provided in this article, including text, graphics and images does not, and is not intended to, substitute advice; instead, all information, content, and materials available in this article are for general informational purposes only. Information in this article may not constitute the most up-to-date legal or other information.

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