Since 1 April 2023, every privately let commercial unit in England and Wales must be rated EPC E or better. If yours is rated F or G, there are two ways to keep letting it lawfully: improve it to E, or register an exemption. This page is about the second.
What an exemption does
An exemption allows you to let a property below the minimum standard for a fixed period. It does not change the rating, and it does not last for ever. It only counts once it is registered on the PRS Exemptions Register: an exemption you qualify for but have not registered does not protect you.
The six exemptions
The Government's landlord guidance lists these types:
1. 7-year payback. A measure, or package of measures, fails the test where the expected value of the energy bill savings over seven years from installation is less than the cost of buying and installing it. You need three quotes from qualified installers, confirmation that you are satisfied the measures fail the test, and copies of your cost calculations.
2. All improvements made. For a property where all relevant energy efficiency improvements have been made, or none can be made, and it is still below E.
3. Wall insulation. Where the only relevant improvements are cavity, external or internal wall insulation, and you have written expert advice that they would harm the property or the building.
4. Third-party consent. Where improvements need consent from someone such as a tenant, superior landlord, mortgagee, freeholder or the planning department, and despite reasonable efforts it is refused, or given on a condition you cannot reasonably meet. Keep evidence of the request and the refusal.
5. Devaluation. For improvements that would reduce the market value of the property by more than 5%. You need a report from an independent RICS-registered surveyor.
6. Recently became a landlord. A temporary exemption for someone who has just become the landlord.
How long they last
- Exemptions on the PRS Exemptions Register last 5 years.
- The recently-became-a-landlord exemption lasts 6 months.
When an exemption ends, you must try again to improve the property. The guidance says that "if this cannot be achieved then a further exemption may be registered".
Put the end date in your diary when you register. Five years passes quickly, and the expiry of an exemption is easy to miss if the lease runs on.
Registering
Exemptions are registered on the PRS Exemptions Register, through the GOV.UK Register or manage an exemption service. The register is public: anyone can view registered exemptions.
Keep copies of everything you relied on: the EPC, quotes, the advice you were given and any refusals of consent. If an enforcing authority asks, you will need to show why the exemption applied.
If you sell
An exemption ceases to be effective when the property is sold or otherwise transferred. The new owner must either improve the property or register an exemption of their own. If you are buying a let unit that relies on an exemption, the 6-month new-landlord exemption is the temporary route; plan for what comes after it.
Getting it wrong
Registering false or misleading information on the PRS Exemptions Register can bring a penalty of up to £5,000, on top of any penalty for letting in breach. Letting below E without a valid exemption for three months or more can cost the greater of £10,000 or 20% of rateable value, up to £150,000, plus a publication penalty. See MEES penalties for commercial property.
Is an exemption the right route?
An exemption is a time-limited answer. Improving the unit to E is the permanent one. Before you register, it is worth asking:
- Is the rating current? If your certificate predates 15 June 2022, a new assessment may rate the unit differently, because certificates since then use a different methodology. That cuts both ways.
- How close is it to E? A unit just below the line may need less than you expect.
- When does the lease end? Lining up works with a vacancy is often easier than working round a tenant.
A commercial energy assessor can tell you which measures would lift the rating and roughly in what order.
What our figures can and cannot see
Our area pages count let units rated F or G on a valid certificate. We do not have the PRS Exemptions Register, so some of those units will be lawfully let under an exemption. That is why we describe them as units that "cannot be let unless an exemption is registered", not as units that are being let unlawfully. More on how we count.
Find your council's figures under every area.
Sources
- Non-domestic private rented property: minimum energy efficiency standard, landlord guidance, GOV.UK, updated 5 May 2026. Checked 30 September 2026; exemption-transfer wording read 6 October 2026.
- The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015, regulation 41. Checked 30 September 2026.
Checked against GOV.UK and the regulations on 2026-10-06. More help