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0% vat on batteries and other renewable peripherals

0% VAT on Batteries and Other Renewable Peripherals

Great news for the renewable energy sector! From 1st February 2024, VAT on hundreds of energy-saving products, including solar batteries, water heaters, and EV chargers, was reduced to 0% in the UK. This tax reduction aims to make sustainable energy solutions more accessible and affordable for everyone.

Why the VAT Reduction Matters

VAT, typically added to 'luxury' goods, was raised to 20% by the government in 2010. Over the years, various groups have successfully campaigned for VAT reductions on essential items. The renewable energy sector has been one of the most successful in these efforts, emphasising the importance of affordable green solutions.

In April 2022, VAT on solar panels, inverters, and related installation equipment was reduced to 0%, sparking a significant increase in solar PV installations. Now, the reduction extends to a broader range of energy-saving measures (ESMs), encouraging even more households and businesses to adopt green energy solutions.

How Solar Battery Storage Fits In

Solar panels generate electricity during the day, but energy consumption doesn’t always align with these peak production times. This is where solar battery storage systems come in, storing excess energy for use during the night or on cloudy days, maximising the efficiency of solar power systems.

Recent advancements in lithium-ion battery technology have made solar battery storage more efficient and affordable. The UK government’s reduction of VAT to 0% on batteries further enhances these benefits, making it easier for homeowners and businesses to invest in energy storage solutions.

Benefits for Homeowners and Businesses

The new VAT reduction not only applies to batteries but also to other renewable energy products like EV chargers and immersion diverters. This means more cost-effective options for fully utilising Smart Export Guarantees (SEGs) and solar energy systems.

For instance, retrofitting storage to your existing system, installing a battery-only system, or simply buying a solar battery now comes with a 20% discount. Additionally, the reduction covers a wide range of energy-saving technologies, making sustainable living more accessible.

Future Prospects

The current legislation includes a Sunset Clause, meaning the 0% VAT relief is set to expire on 31st March 2027, at which point VAT will revert to the reduced rate of 5%. However, given the political landscape, this could change, extending the benefits even further.

Wrapping Up

The reduction of VAT to 0% on batteries and other renewable peripherals is a significant step towards a greener future. Fusion Solar is here to help you navigate these changes and take full advantage of the benefits. For more information on Energy Saving Measures VAT relief, visit the government website.

By embracing these incentives, we can all contribute to a more sustainable and environmentally friendly energy landscape. Join us at Fusion Solar in making the most of these opportunities and driving the renewable energy revolution forward.

 

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