I’ve written more blogs on Energy Performance Certificates than I can count and watched the twists and turns like a thriller series - full of plot twists and cliffhangers. Here I come again with the latest update!
If you missed my previous EPC updates, catch up here: EPC Update: Plot Twist.
At 1Let, our mission remains the same - to keep landlords informed and ready to adapt confidently to new regulations.
EPC reform: what’s changing and when
The Scottish Government’s proposed reforms represent a major shift in how energy efficiency is measured and reported. Rather than focusing on the heating system, the new EPC system will assess how well a property retains heat, focusing on insulating the roof/walls/floor and installing double glazing/draught proofing. The problem? The current EPC doesn’t measure this.
1. Introduction of the heat retention rating (HRR)
From 31 October 2026, EPCs will include a new heat retention rating (HRR), providing a clearer measure of a building’s ability to retain heat. This new rating will become the key metric in future minimum energy efficiency standards, replacing the current overall EPC score.
2. EPC validity period reduced
EPCs will now be valid for five years instead of ten, ensuring assessments reflect recent improvements and current building conditions.
3. Transition period
A transition window until 31 October 2027 will allow landlords to use either an existing EPC (under the current system) or a new-style EPC for their first new let after the changes take effect.
MEES: the next step toward regulation
Unlike in England, Scotland currently has no minimum energy efficiency standard (MEES) requirement for private rented sector (PRS) properties. However, following several consultations, the latest proposals published on 6 June 2025 aim to introduce minimum standards linked to the new EPC system.
Under the draft plans:
- From 1 April 2028, all new tenancies will need to meet a minimum EPC equivalent of C (based on the new heat retention rating).
- By 31 December 2033, this requirement will apply to all PRS properties.
According to government analysis, around 80% of properties currently rated EPC C are expected to retain an HRR C under the new system. Homes with weak insulation but cheaper heating fuels may see lower scores, while well-insulated homes using costlier fuels (like electricity) may perform better.
Exemptions, caps and timing strategy
The proposals include several exemptions, including where:
- Works are technically unsuitable for the property type ( example, if wall insulation is likely to cause damp issues)
- Required consents (from tenants, neighbours or planning) cannot be obtained
- Costs would exceed a £10,000 spending cap
Additional exemptions would apply where all appropriate measures have been installed but the property still falls short of HRR C, or where a landlord has recently acquired a property with a sitting tenant (with a six-month grace period to plan improvements).
There is also discussion of a 12-month “spend window”, allowing landlords to count energy efficiency works completed just before the standard takes effect toward the spending cap. This could make timing crucial, which is why we recommend waiting until the new HRR system is in place before investing in major works.
However, waiting too long carries risks: as deadlines approach, demand for tradespeople will surge and costs may rise. Landlords should plan ahead, budgeting for both timing and availability challenges.
Funding and support available
Landlords will only be expected to carry out improvements where funding or loans are available. While direct grants remain limited, support includes:
- Private Rented Sector (PRS) Landlord Loan – up to £100,000 interest-free (for owners of up to five properties) or £250,000 at 3.5% APR (for larger portfolios), details of which can be found here.
- For more information on funding which is available to landlords in Scotland, visit the Energy Saving Trust "support for landlords" page or call Home Energy Scotland on 0808 808 2282. Funding may also be available based on the status of tenants, particularly if they are elderly or on low incomes. To find out more about whether this might apply, tenants can contact Home Energy Scotland for advice on 0808 808 2282
HEETSA: coming soon
The Scottish Government also plans to introduce an optional heat and energy efficiency technical suitability assessment (HEETSA). This new assessment will guide landlords on the most effective and technically appropriate upgrades, helping avoid costly or unsuitable measures that might cause damp, mould or condensation.
HEETSA is not yet available but is expected to roll out after 2026, complementing the new EPC and MEES frameworks.
1Let’s advise for landlords
- If your property is EPC C or above, you’re likely in a strong position under the new rules.
- If your property is below EPC C, wait until the new heat retention rating is introduced before commissioning upgrades. This ensures your investment aligns with the new standards and counts toward any future cost caps.
- Plan ahead: consider arranging a new EPC post October 2026 for accurate, up-to-date insights.
- Stay informed: regulations are evolving rapidly, and we’ll continue to share updates as new details emerge.
For full details, you can read the government consultation here.
At 1Let, we’re keeping a close eye on every development and will guide our landlords through the upcoming EPC and MEES changes with confidence. We’ll contact affected landlords directly to review EPC ratings and plan timely, cost-effective routes to compliance.