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Call for Evidence: VAT Energy Savings Materials Relief-Improving Energy Efficiency and Reducing Carbon Emissions

We welcome the opportunity to respond to the HM Revenue and Customs department’s “Call for evidence: VAT energy saving materials relief- improving energy efficiency and reducing carbon emissions”. The solar and energy storage industry has a major role to play in addressing the cost of living and climate crises, and the Government can act to ensure as many homes as possible benefit from home electricity storage. This should be regardless of whether it is fitted alongside another measure, such as solar panels. In our view, the tax status of energy storage should not be dependent on the point at which it is installed.

The inclusion of battery storage within the list of energy-saving materials will be a critical driver for the UK to decarbonise its housing stock. There are key benefits of storage, such as energy security/self-consumption, reducing strain on the grid as well as cost savings, especially during the current cost of living crisis. Moreover, eliminating VAT would help the UK to meet the solar industry’s ambition of deploying 70GW of solar by 2035 ambition. We develop this in our response below.