New Property Law… Energy Efficiency Certificates

What are they?

The Energy Efficiency Certificate (also know as an Energy Performance Certificate) is a certified report that explains how efficient a property is in terms of energy consumption and efficiency in an effort to reduce unnecessary carbon emissions.

The Energy Efficiency Certificate (Certificado de Eficiencia Energetica) is part of a mandatory European directive issued in 2002. Its origin therefore is in European legislation and it should have been implemented in Spain some years ago, but the Spanish law makers are only now enforcing this legislation.

All other European Union countries already apply these rules, most of them since 2007, which was the target for citizens to be informed of their home energy consumption. In the same way that we have a right to know if a refrigerator is Class A or D we must also know how to choose energy efficient housing to get an idea of the energy costs to live in it. The certificate will assign an energy rating to your property on a scale from “A” (the most efficient) to “G” (the least efficient).

The Royal Decree 235/2013 of 5th of April 2013 was approved, requiring property owners to obtain Energy Efficiency Certificates for their real estate property, to align Spain with all the other EU countries who have already implemented the energy certificate legislation.

When does this apply?

This legal requirement becomes mandatory on the 1st June 2013, and all individuals who wish to sell or rent a property built before 2007 are required to have an energy certificate qualifying the property for sale or rent.

If your property was built after October 2007 you may find that you already have a Spanish Energy Efficiency Certificate, but although all new homes built after 2007 should already have one, some Spanish regions were negligent in enforcing the legislation, so some new homes won’t have one. To check this look on your plans to find the architect and contact them.

It is estimated that these new rules will immediately affect one and half million properties.

Who does it apply to?

The law requires that all owners of a building, house, apartment or premises that is for sale or for rent must have this Certificate.

In addition to this, the energy efficiency label (“etiqueta”) must by Law be included in any offer, promotion and advertising linked to the sale or rental of a property and estate agents must display the energy label in their advertisements and must also be presented to the Notary upon completion of a sale.

A certificate must be available for inspection to any potential buyers, tenants, the Notary and Town Hall inspectors. The legislation does not only apply to homes and buildings, but also to offices and commercial buildings. In such cases it is obligatory to display the energy efficiency label in a prominent place visible to the public.

If you have a property that is used for less than four months each year and you have no intention of renting it or selling it, then the law does not insist that you obtain a Certificate. However, the article does not equivocally state that if you rent a property for less than four months a year it is completely exempt… there are other factors to consider.

Avoid having your property put under a magnifying glass

Do you really want to have to prove to a government official how many weeks a year your property is used, let, or not let? Do you want to permit a government official access to your tenancy records? Do you want to argue a case, even if you are right, knowing a government official will have the final word on whether or not to penalise you?

As there are grey areas regarding exemption from obtaining a Certificate, considering the cost involved, it may be prudent to obtain one anyway, rather than perhaps have the time consuming hassle of contesting a sanction against you.

What happens if I break the law and ignore this?

Not meeting these regulations incurs a violation under the consumer protection laws and will be punished according to the General Law on Protection of Consumers and Users.

Each Autonomous Community will perform inspections and keep records to ensure compliance with this requirement and will in turn have to give account to the Ministry of Industry.

If you fail to get an Energy Efficiency Certificate when renting or selling your property, you could be heavily fined by the government. Also, any estate agent promoting a property for sale after the 1st June 2013, without it having a Certificate and not showing the ‘Logo’ in advertising could also be heavily fined for doing so.

We have been prepared to take a risk on this during the short term, on the basis that we can argue that it is simply not possible for our clients to obtain Energy Certificates for all the properties in our portfolio in the time given, but they have at least been applied for.

After some months of the legislation being in force, we are reaching a time when we will have to consider not advertising the property of any vendor who has not applied for an Energy Certificate and remove it from our website, window displays and other forms of advertising. Clearly, from a business point of view, this is the last thing that we want to do, but the risks for our clients and also ourselves in promoting the property for sale or rent illegally, are far too great to ignore.

According to reports in the press, the authorities have already started issuing substantial fines against property owners who are advertising their properties for sale or renting them without having applied for an Energy Efficiency certificate.

Who pays for the energy certificate?

The Energy Efficiency Certificate will be valid for ten years and its cost must be borne by the existing property owner who will also be responsible for renewing it, unless the property is sold, in which case it will be the responsibility of the new owner.

How is the rating on my property worked out?

A registered technician will visit your property and take measurements and recordings from things such as your air conditioning, your hot water system, type of windows fitted, type of insulation, type of construction etc., etc. The readings and measurements taken will then be entered on line into one of the Governments approved programmes, which will generate the rating for your property giving its energy efficiency and environmental impact. The programmes used are the same for all properties so a potential buyer or tenant will be able see the projected energy costs for each property viewed.

If the certificate issued for my property shows a poor energy rating, such as F or G, am I legally required to make any improvements before I can sell or rent my property?

No, you are not required to make any home improvements whatsoever.

The technical certification includes proposals for reforms that could be done to improve the energy efficiency of the property, but these proposals are given by way of information only. You must decide whether or not to increase the energy efficiency of your property and thus reduce energy consumption costs.

Who is qualified to issue such certifications?

According to the royal decree, Energy Efficiency Certificates must be issued by qualified professional technicians who are authorised to undertake building projects and thermal installations for buildings.

Architects, surveyors, engineers and technical engineers are the only professionals qualified to issue these certificates, providing they know and can use certification programs-CE3 existing buildings and CE3X, says the Association of Architects of Madrid (COAM).

What must be done once the Certification has been obtained?

The competent body for each region on energy certification of buildings will have a ‘register of certificates’. Registration will allow for the inspection work and technical / administrative control which are contained in Articles 9 and 10 of the Basic Procedure.

Also available to the public, records are updated regularly and the Certificates will be registered with the Ministry of Industry (Industria). Competent technicians, or companies that have the services of such experts, will provide access to information about the certificates to citizens.

What is the cost of obtaining the Energy Efficiency Certificate?

Each property has characteristics (type, size, location), and based on them certifying technicians adjust their prices and offer their quote. The important thing is that technicians thoroughly understand the certification process and can budget their work accordingly.

Costs vary greatly from country to country in the European Union. In France and the Netherlands, for example, prices range between 200 and 400 Euros, whilst in Belgium they are more between 400 and 600 Euros, depending on the type, size of property and area. However, in Denmark the cost can reach 900 Euros and in the UK anything from 300 to 1,000 Euros.

In Spain, the first indications suggest that the lowest figures are placed around 200 Euros for a normal small apartment, rising to 300 Euros for a house of 215 square meters and 500 Euros for larger detached properties.

Because we have such a large client base and portfolio of properties for sale, we have been able to negotiate with a professional firm of seven fully qualified architects in Sta Cruz to assist our clients. We are pleased to advise that we can arrange for an inspection of your property and the issuance of an Energy Certificate that will be passed by The Ministry of Industry, together with the ‘Label’ that must be shown on all advertising and the registration of the certificate with the relevant authority.

The cost for normal apartments up to 100 m² will be just 150 Euros and 200 Euros for properties up to 200 m². For larger individual villas, we can obtain a quotation on request, but the price will still be less than normally being charged.

What must I do now?

Take immediate action by filling in the form below. Do not be complacent, as this is not simply a request by the Spanish authorities but a Law that you cannot ignore.

Get your Energy Certificate NOW!