climate crisis: huge vat rise on solar panels makes installation ‘entirely uneconomic’, say experts

by:Tunto     2020-04-16
Experts warn that increasing the value-added tax on solar panels from 5 per cent to 20 could make the installation of solar panels \"completely uneconomical \".
Although Parliament announced a climate emergency earlier this month, fossil fuel tax rates, including natural gas and coal, will remain, while tax rates on some renewable energy materials will rise by 15.
These rates will apply from October 1 and after the consultation concluded last week by HMRC.
The rise in value-added tax on solar panels and battery storage materials comes as the UK government\'s official climate change advisory body recommends that the UK achieve net zero emissions of fossil fuels by 2050, with eight EU countries calling on the EU to implement similar targets. Sian Berry, co-
The Green Party leader told The Independent: \"The climate emergency has been officially announced, however, it is impossible for us to have a clearer indication that the government has not even begun to seize this urgency.
Energy-efficient renewable energy is the future, but the government has hit them again.
\"Suppliers, including many small independent companies in communities across the country, have been hit by the sudden removal of feed --
At the end of customs and export duties.
She added: \"The Conservative government has once again chosen to place large polluting energy producers above small clean-up businesses.
Renewable Energy Association (REA)
Objections are being raised to the HMRC proposal.
The company said the rate hike was a shock to the industry because they had been consulted in 2015/16, and is considered to be the \"interest rate\" to finalize the minister \"after being guaranteed at that time \".
Despite the declining technology costs in the industry, REA said that such growth \"may mean that the UK market is at a strategic disadvantage in attracting investment and transforming the energy system, effectively increasing the cost of most new project equipment and punishing consumers who want to reduce their carbon footprint.
Frank Gordon, policy head of the association, said: \"The proposed VAT rate hike hit small-
Under the already difficult situation, we will vigorously develop the renewable energy industry.
This change could make home and business in the UK low-carbon in the coming years.
\"Despite the recent massive climate
Related protests and the British Parliament have declared a climate emergency, and the government has once again set obstacles to reducing emissions and increasing the cost of families who want to help.
Nor did they recognize the cumulative impact of the withdrawal of up to 18 policy mechanisms supporting renewable energy deployment since 2015, which could lead the UK to lag behind in low-carbon and clean growth.
He added: \"REA wants the government to hear from us and urgently reconsider and address this issue, taking advantage of the hard work that businesses have done to reduce the cost of solar energy and energy storage.
Dr. Jonathan Marshall, energy analyst at Energy and Climate Intelligence, told The Independent that the decision was \"the latest in a series of actions by the government to hurt solar energy \".
He said: \"On the one hand, you have a government that is growing itself, marking all the milestones of progress-how much power we have gained from non-carbon-intensive sources-on the other hand, you have quite a few backsliding policy initiatives that are slowing the progress they seem to be so eager.
\"Not only does this increase the value added tax on solar energy, but it also changes the entire framework of small-scale renewable energy, so installing solar panels on your house now is almost completely uneconomical.
\"The government said the decision brought the country in line with EU law, which ruled in 2015 that the discount rate was illegal.
But after the ruling, the government did not enact the changes immediately, and the European Court of Justice issued a VAT action plan in 2016, without comment on solar energy.
A spokesman for HMRC said: \"The government proposes reforms to reduce energy taxes as much as possible.
Save material while ensuring that UK rules are in compliance with EU laws.
\"The new rate will take effect the same month as the UK\'s deadline for leaving the EU.
Dr Robert Gros of the Centre for Environmental Sciences at Imperial College London told The Independent: \"The UK has reluctantly complied with a regulation of the EU, which is in line with the EU\'s desire for carbon dioxide and renewable energy
On the other hand, the government does not need to cancel tariffs on small loans
A generation that has made a huge contribution to supporting the growth of solar energy in the UK.
\"It could have been set to zero instead of removing the fit
Subsidy rates to provide long-term stable income from solar panels to households and business owners at fixed prices or below traditional electricity prices.
\"The government has decided not to do so,\" he added. [It is]
Has nothing to do with EU law.
So those who want to buy solar panels for their families will face higher costs and at the moment they will not be able to get the benefit from selling excess power back to the grid.
Previously, the tariff system allowed people to recover some of the costs of installing solar systems at home, but the plan ended this year.
It is illegal to fail to obtain compensation for power contribution to the grid, but alternative systems-smart export guarantees-have not yet been finalized and rolled out.
The new system is designed to be more responsive to the needs of the grid, which should be reflected in the payment of people who generate excess power.
Dr. Marshall said: \"With the smart exit guarantee, if the solar panel is generated when the system is a bit short, the energy it generates will have a higher value-so if the wind is not very large, you will get more money.
This is a sensible approach, but the way policies are implemented is so stopped --start.
At the moment, if you buy solar panels and put them on your house, there is no way to ask for any electricity charges.
You have to want you to use it yourself or buy the battery at your own expense.
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