In a much-needed move towards energy efficiency, the government has unveiled plans to grant tax relief on battery storage systems.
“It’s fantastic that the government has extended tax relief on battery storage systems. The expanded VAT relief aligns with the UK’s commitment to reducing carbon emissions and promoting green energy solutions.
Effective 1 February 2024, the UK government has exempted retrofitted battery energy storage systems (BESS) from the 20% VAT. This recent and welcomed development means homeowners looking to upgrade their homes with energy storage now enjoy the same tax benefits as those incorporating energy-saving materials like heat pumps and roof-mounted solar.
In conclusion, the UK Government’s decision to reduce the VAT on battery storage systems to 0% from 1st February 2024 is a landmark move in the nation’s journey towards sustainable energy.
Extension to Grid-Connected Batteries: The VAT relief has been extended to include grid-connected batteries, further incentivising the integration of renewable energy sources into the national grid. This expansion recognises the pivotal role grid-connected batteries play in stabilising and enhancing the efficiency of renewable energy systems.
The introduction of this policy in 2024 means that energy storage systems, a critical component in the utilisation of green energy, will become significantly more financially viable. This reduction in VAT will not only lower the cost of acquiring these systems but also make them a more attractive investment for consumers.