Energy advice for private landlords

• Why should landlords be interested in energy efficiency?
• Landlords' Energy Saving Allowance (LESA)
• Energy Performance Certificates (EPC)
• Help for your tenants
• Avoid electric heating
• Annual gas safety check
• Advice leaflet for Devon landlords
• Free flagship home guide for landlords
• Free energy advice

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This page was requested by a number of landlords who attended the Landlord Expo at the Guildhall. Many had not heard of the LESA tax break, and were uncertain of what was involved with Energy Performance Certificates. Hopefully this page will answer many of your questions, but if you have any suggestions for improvement please contact energy@plymouth.gov.uk

Why should landlords be interested in energy efficiency?

Improving the energy efficiency of your properties will benefit private landlords in many ways:

• The value and desirability of your property is protected or enhanced
• There will be reduced risk of damp, condensation and mould growth
• You will receive a tax rebate on energy efficiency spending
• Tenancies should become longer and more secure
• Void periods, complaints and repairs should decrease
• Your tenants will enjoy warmer, more comfortable lives
• Your tenants, especially those who are elderly, will not suffer cold-related illnesses
• You will improve your Energy Performance Certificate rating ahead of certification
• Your reputation as a landlord will be improved
• You will be helping to meet targets for reduced carbon dioxide emissions

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Landlords' Energy Saving Allowance

This is a tax allowance that was introduced in 2004. It is very simple to claim: you get the appropriate energy efficiency measures installed, then complete box 5.36C on your tax return at the end of the year. Tax relief is for a maximum of £1,500 per property. For example:

• suppose your annual taxable income is £20,000
• you undertake insulation measures to the value of £1,500
• your total taxable profit is reduced to £18,500
• your saving at 22% tax is £330, or at 40% tax is £600

If you undertake energy efficiency measures to more than one property the tax saving is multiplied by the number of properties you apply measures to.

Appropriate energy efficiency measures are:

• cavity wall insulation
• solid wall insulation
• loft insulation
• draughtproofing
• floor insulation
• hot water system insulation

Note that the LESA now applies to corporate as well as individual landlords.

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Energy Performance Certificates

Landlords will be required to obtain an Energy Performance Certificate as properties are re-let from October 2008. Once you have an EPC for a particular property it will have a life of ten years. In other words, if you re-let that property three times during the ten year period you do not have to pay for three energy surveys. The EPC will ‘band’ your property from ‘A’ (good) to ‘G’ (bad) with a label that will be familiar to anyone who buys a fridge or other electrical appliance. Just as an ‘A’ rated fridge will be cheaper to run than one rated ‘C’, so will an ‘A’ rated home. Running costs are very important, especially to people on a low income. A home with a low energy rating will be expensive to keep warm, leaving your tenants with two choices: either pay a very high proportion of income on warmth (and sacrifice something else), or risk a range of medical conditions associated with living in a cold damp home.

A number of Plymouth landlords are concerned about who would undertake the EPC survey and have expressed an interest in the Council providing this service. If you might be interested in Plymouth City Council providing such a service to landlords, let us know by emailing us.

Help for your tenants

Your tenants may be entitled to grants towards the cost of insulation and heating measures. The Government’s Warm Front grant will cover the cost of central heating and insulation for people on benefit. There may be an ‘excess charge’ however that would have to be paid by the landlord. Work cannot proceed without the permission of the landlord.

If you have tenants with a cold-related illness and who are not on benefit they may be entitled to a Plymouth Healthy Homes grant for heating or insulation. Once again there may be a cost to the landlord, and landlord permission is required before the measures are installed.

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Avoid electric heating

Many landlords ask about electric heating. It is important to recognise that electric heating is very expensive to run compared to gas. Gas is roughly 2p per unit whilst electricity is roughly 10p. Electric heating is also considerably more carbon intensive than gas (unless your electricity comes from a ‘green’ source such as wind power). A home with electric heating will have a low Standard Assessment Procedure (SAP) rating. The SAP (energy) rating will determine which band the home is in on the forthcoming Energy Performance Certificate.

The worst possible scenario for someone on a low income is to live in a home with solid walls (usually pre-1930) with electric heating. Such a person will almost certainly be in Fuel Poverty and could suffer poor health because they cannot afford to keep themselves comfortably warm at home.

Whilst gas central heating with a good control package is ideal, there are circumstances where alternative heating might be necessary. For example, if there is no mains gas supply in the local area. In such circumstances better alternatives to electric heating are available, such as air-source heat pumps.

Annual gas safety check

Do not forget that you are responsible for undertaking an annual gas safety check for any property with a gas appliance, such as a gas boiler or room heater. The check is required by the Gas Safety (Installations and Use) Regulations 1998 and must be undertaken by a CORGI registered installer. For a useful source of information for landlords visit the gas safety advice for landlords page on the Health and Safety Executive website.

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Advice leaflet for Devon landlords

National Energy Action have worked with local authorities in Devon to produce an information booklet for landlords with property in the county. The booklet has been mailed out to most landlords, but if you have not received a copy please email us and we will send you one.

Free flagship home guide for landlords

The Energy Saving Trust provide a useful free 12-page booklet for those landlords who are really keen to improve the energy efficiency of their properties. Entitled ‘Making private rented housing energy efficient – the Flagship Home case study’ it is available from the Energy Saving Trust website.

If there are any landlords with properties in Plymouth who might be interested in renovating to a ‘Flagship Home’ standard or even being the first Carbon Neutral Landlord, please get in touch with us.

Free energy advice

For free impartial energy advice, including grants, call the Devon Energy Efficiency Advice Centre on 0800 512 012.

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