In a welcome move, the Government has confirmed that it is
consulting on a change to VAT on energy saving materials which
could boost the capacity of householders to use solar energy to
power their homes.
Earlier this month the Environmental Audit Committee (EAC) wrote
to the Energy Security and Net Zero Secretary, Rt Hon MP, to set out its findings
following a short inquiry into the prospects for technological
development to deliver more clean energy from solar
installations. Within the letter, members called for VAT to be
removed on battery storage, when installed either new or
retrospectively in conjunction with rooftop solar systems in
order to make better use of household-generated solar energy.
The Committee also outlined its concerns at the current
constraints on expanding access to the National Grid, amid fears
that present capacity and current arrangements to expand the grid
will not allow the UK to reach its full renewable energy
potential. Members heard how in some cases, it is taking 10-15
years for solar developers to secure a grid connection.
In a letter to the
Committee, published today, the Energy Security Secretary
outlines work currently underway to address grid concerns,
including workstreams incorporating Ofgem, network companies and
the Electricity Systems Operator. EAC will monitor progress
within these workstreams in the course of its current inquiry
into Enabling sustainable
electrification of the UK economy.
EAC found in its work on Technological innovations
and climate change: Onshore solar energy, that many
households are struggling with the upfront costs of solar
installation. As a result, Committee members recommended that the
Government consider consulting on how it can facilitate
affordable loans for households. In response, the Energy Security
Secretary confirms that the Government is exploring options for
facilitating low-cost finance from retail lenders.
While the Government is reluctant to incorporate installation of
solar PV as a minimum requirement within the Future Homes
Standard, the Energy Security Secretary does expect that
developers will choose to install solar on rooftops to comply
with new energy efficiency standards.
Environmental Audit Committee Chairman, Rt Hon MP, said:
“Solar energy is now the cheapest form of power, and the
future is bright to make the most of the technology both on the
ground and on rooftops. Onshore solar is an invaluable component
of the country’s Net Zero Britain ambitions, and I am pleased
that the Government is committed to fulfilling its aim to
increase capacity to 70GW by 2035.
“Earlier this month we wrote to the Energy Security
Secretary with some recommendations to help the UK meets its
solar potential. It is very welcome that tangible steps are being
taken to address grid constraints and proper consideration is
being given to ease the financial burden on households who may
choose to install rooftop solar.
“The issue of VAT on batteries being installed after
solar panels is an issue that has been raised multiple times
within our Committee’s work. I am therefore very pleased that
this is being considered in the Government’s consultation on VAT
on energy saving materials, and the Committee will be making
representations to the Chancellor of the Exchequer to highlight
the evidence we have taken on this issue”
