Published: 27 Apr 2021, 10:46
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Image: Giorgio Trovato (Unsplash).
Removing VAT on clean energy products like solar panels is supported by a majority of the public, new analysis by Green Alliance has found.
In a BritainThinks survey for the thinktank s TransformTax project, a sample of 2,076 members of the UK public were asked about whether the tax system should be used to encourage more sustainable choices.
According to Green Alliance, the results were unequivocal”, with sustainability a primary concern that the public believes should be tackled through green taxes amongst other pathways.
Of those surveyed, 80% believed that the government should be responsible for dealing with environmental issues, and 62% wanted higher governmental spending to address them.
A letter penned by energy supplier Bulb and signed by over 30 industry organisations is calling on the government to reduce VAT rates for green technologies, including solar and energy storage.
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Otherwise, future longer-duration energy storage needs will be left unmet without significant change, the report found.
The Longer-Duration Energy Storage: The missing piece to a Net Zero, reliable and low-cost energy future report estimates that the UK will need at least 30GW of longer-duration energy storage by 2050.
The report concludes that this target is currently undeliverable based on the present market and regulatory framework.
REA’s analysis found that an Income Floor would be the best market mechanism for supporting this category of storage, but that a Regulated Asset Base model could be a suitable alternative.
Highlighted barriers included the relatively short length of contracts for capital intensive projects and a ‘salami sliced’ procurement of services.