Landlords face a complex and varied financial challenge in upgrading their properties to an Energy Performance Certificate (EPC) rating of C by 2030. Recent analysis of real EPC data reveals that the cost of achieving this standard differs significantly depending on property type, construction, and existing heating systems, challenging the commonly cited average upgrade cost of £6,000 to £7,000.

Understanding the true cost of EPC C compliance

The government’s open data portal provides access to every EPC certificate, detailing current and potential ratings alongside recommended improvements and estimated costs. By examining this data for properties rated D, E, F, or G within a local authority area, it becomes clear that the financial burden of reaching EPC C varies widely.

For example, a mid-terrace property from the 1930s with cavity walls, decent loft insulation, and double glazing might only require a boiler upgrade and cavity wall insulation, costing between £2,500 and £4,000. In contrast, a solid-wall Victorian end-terrace with single-glazed sash windows and no loft insulation could face costs exceeding £10,000.

Key factors influencing upgrade costs

The type of walls is the most significant determinant of upgrade expense. Cavity wall insulation is relatively affordable, costing between £350 and £500, and can improve the EPC rating by 5 to 10 points. However, solid wall insulation—whether internal or external—can cost between £5,000 and £15,000. Additionally, landlords have raised concerns about potential damp issues arising from solid wall insulation in older properties.

Heating systems also play a crucial role. Properties with modern condensing gas boilers, which are rated A, have already secured valuable EPC points. Conversely, replacing an old non-condensing boiler with a modern condensing model can cost £2,000 to £3,000 but may increase the EPC score by 10 to 15 points.

Timing and regulatory changes

Properties that achieve an EPC rating of C under the current Energy Efficiency Rating (EER) system before October 2029 will be considered compliant until their EPC expires, which is typically after ten years. This means landlords who secure a C rating before the new Home Energy Model (HEM) is introduced could potentially be compliant until 2039.

The forthcoming HEM system will require properties to meet two criteria: fabric performance and either smart readiness (such as solar panels or battery storage) or heating system performance (including heat pumps). This new standard is expected to be more demanding and costly to meet. Several webinar participants have confirmed this interpretation, suggesting landlords may benefit from seeking assessments under the current system sooner rather than later, even if their EPCs are not yet due for renewal.

What landlords need to know per property

Given the wide variation in upgrade costs and requirements, landlords would benefit from a detailed, property-specific approach. This includes knowing the exact recommended improvements for each property, the EPC points each upgrade would add, whether these improvements are sufficient to reach EPC C or trigger a cost cap exemption, and what grants might be available, such as ECO4 or the Warm Homes Local Grant, depending on the property and tenant circumstances.

Many landlords have yet to explore their properties’ EPC certificates in detail or assess how recommended improvements have translated into actual EPC score improvements. The government’s average cost estimates may not reflect the significant variation experienced on a property-by-property basis.

What this means for landlords

Landlords should approach EPC C compliance with a tailored strategy, recognising that costs can vary dramatically depending on property characteristics. Early assessment under the current system may provide a compliance advantage ahead of the more stringent HEM requirements. Understanding specific upgrade recommendations and available financial support will be essential to managing costs effectively and ensuring properties meet the 2030 deadline.

Source: Based on reporting from Property118

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