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Landlords face ban on renting energy-inefficient homes under labour’s new policy

September 23, 2024

Landlords will be banned from renting out properties that fail to meet minimum energy efficiency standards by 2030, according to Ed Miliband, Labour’s energy secretary, who will announce the policy at the Labour Party conference on Monday.

Under the proposed legislation, all rented homes must achieve at least a grade C on their Energy Performance Certificate (EPC), a move set to affect millions of privately rented properties. Landlords could face costs of up to £10,000 per property on upgrades such as insulation, solar panels, or heat pumps to meet the new standards.

The Conservatives had originally planned to implement similar measures by 2028 but scrapped the deadline under former Prime Minister Rishi Sunak, citing the financial burden on landlords. Labour’s reinstated policy offers an additional two years for compliance but is expected to reignite tensions with property owners, with estimated costs totalling around £25 billion.

“We all know that the poorest people in our country often live in cold, draughty homes,” Miliband is expected to say. “It is a Tory outrage. This government will not tolerate this injustice, and we will end it.”

The new regulations will also apply to council housing, requiring local authorities to upgrade their housing stock—a move that could entail significant public expenditure. Labour sources indicate they are prepared to confront potential pushback to achieve their green objectives.

The announcement comes alongside Labour’s pledge to end no-fault evictions and introduce a range of pro-tenant reforms. While these measures have been welcomed by housing campaigners, they have raised concerns among landlords about the viability of remaining in the rental market.

A consultation is anticipated later this year, likely including a cap on the amount landlords must spend on property upgrades, expected to be around £10,000—consistent with previous proposals. Landlords will be eligible for assistance from Labour’s £6 billion home insulation package, although specific support details have yet to be outlined.

Approximately 2.9 million privately rented homes currently have energy efficiency ratings below grade C. Despite improvements in recent years, about half of the energy assessments conducted on rented properties last year did not meet the proposed standard.

Michael Gove, the previous housing secretary, had expressed reservations about accelerating energy efficiency requirements, stating that it would impose significant financial strain on landlords. “We’re asking too much too quickly,” he said last year.

Ed Miliband will emphasise the importance of the measures for improving living conditions: “Warmer homes, lower bills, over one million people lifted out of fuel poverty. That’s the difference a Labour government makes.”