In his Spring Statement, Chancellor Rishi Sunak has set out the government’s plans to bring forward an exemption that will make green energy technology, including solar panels and heat pumps, exempt from business rates.
The exemption will come into effect on 1st April 2022, a year ahead of the original date of 1 April 2023 which he proposed in last year’s autumn budget.
Set to save businesses an extra £35 million in 2022-23, the exemption should be worth over £170 million over the next five years as it helps to support the decarbonisation of buildings.
Other plans the Chancellor announced included a 100% relief for eligible low-carbon heat networks which will have their own rates bill, and a VAT reduction on energy savings materials (ESM) from 5% to 0%, something that will further incentivise homeowners to buy ESMs from businesses.
Indeed, this is just one part of a wider package of government measures that are targeted at improving overall energy efficiency in the UK.
Energy Security Plan
The government will soon set out their Energy Security Plan, including measures across hydrocarbons, nuclear and renewables to support energy resilience and security – all part of its ambitions to end the UK’s dependence on Russia.
While Sunak said that the energy plans will “help households improve energy efficiency and keep heating bills down”, delivering affordable energy to consumers will be crucial to whether the Prime Minister’s ‘Ten-Point Plan for a Green Industrial Revolution’ proves to be successful or not.