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Prepare for a step change in some EPC ratings when SBEM 6.1 goes live

There are some significant changes in the next version of SBEM and not enough is being said in preparation for them. Non-domestic energy assessors need to know what is coming and need to be preparing their clients for it. With an expected go-live date of 15th June 2022 this is not far away. 

The biggest thing to note is that the carbon intensities are finally being updated to reflect the decarbonisation of grid supplied electricity. That is undoubtedly a good thing. 

Unfortunately, because it has been left unchanged for so long, 10 years or more of decarbonisation will be corrected for in a single hit. It appears that electricity changes from being (in the region of) twice as bad as gas to slightly better than gas. 

Going forward, we will no longer be penalising electricity and promoting gas while government strategy is exactly the opposite. SBEM 6.1 is a major step forwards in bringing the EPC rating into line with reality as grid supplied electricity has been significantly decarbonised. This is something Proficiency (and previously DCHI) has long been arguing for. However, there is a downside. 

For some buildings there will be a step change in EPC rating as we move to SBEM 6.1 and that is not being talked about sufficiently. Certain types of building that are not meeting the minimum energy efficiency standard (MEES) using current software could easily exceed it, simply by re-running the EPC in the new software. 

How big an issue this will be is dependent on two main factors. 

1) The characteristics of the building. This change will only make a significant difference to some types of buildings. 

2) How long before the changeover an EPC has been produced. It will be much harder to justify having ‘failed’ a building and exposed a client to additional costs in the months, weeks or even days before it would ‘pass’ as it stands. 

The non-domestic EPC rating is calculated by comparing the building with a reference building, but the carbon intensity change will apply to both the actual building and the reference building. In theory, the two sides of the equation should largely balance each other out. Logically therefore, updating the carbon intensities should change the balance between electric heating and gas heating but shouldn't have an impact on a particular building's EPC rating unless the building changes from one fuel to the other. 

However, there is a major issue here in that the reference building always uses gas heating, irrespective of the heating type in the actual building. Therefore, when the actual building has electric heating the carbon intensity on one side of the equation is (roughly) halved and on the other it is not significantly changed. This means there will potentially be a massive change in the rating simply by running the calculation in SBEM 6.1 rather than the current version. 

Our initial tests indicate that some buildings will potentially jump one, two or even three bands as soon as SBEM 6.1 goes live. We believe this will apply most significantly to electrically heated buildings where heating is the majority of the energy use. The most dramatic rating changes we expect to be low grade office and workshop type buildings. A "G" rated building could become an "E" or even "D" rated building the day SBEM 6.1 goes live. This will happen just by re-running the calculation in the new software. 

This has pretty significant implications for energy assessors and their clients. It needs to be considered and discussed in the run up to the changeover as the timing of the EPC is critical. We need to be cautious of recommendations pre changeover that would not be needed (or worse still would be recommended against) after changeover. 

A sudden uplift like this is a big issue that seems to be creeping in under the radar and it shouldn't be. We need to be prepared to deal with the questions that are going to be asked by clients; and we need to make sure we are not blamed for not telling them what is about to happen.  

There needs to be open discussion of this issue so assessors are well prepared. We are also asking accreditation schemes to consider how they are going to approach the lodgement of MEES compliant EPCs in the first few weeks of SBEM 6.1 on buildings that had non-MEES compliant EPCs lodged shortly before the changeover date. We expect to see a high number of these, as well as a high number of surveys done in the period before 15th June with EPCs not lodged until after that date. 

For Proficiency members there is discussion on this subject, and comparisons members have done, in the non-domestic section of our forum (Click here - member access only)

Ian Sturt
Chaiman, Proficiency
30th April 2022