Renew On Line (UK) 29

Extracts from the Nov-Dec 2000 edition of Renew
These extracts only represent about 25% of it

VAT reduction campaign wins

The renewable energy community has been lobbying for reduced VAT on renewables for years but were told that the VAT rate could not be changed once set. This however contradicted the decision in 1997 to reduce VAT from 8% to 5% on domestic electricity.

The announcement in the April 2000 budget of a new reduction of the VAT rate for the installation of energy saving materials in all homes breathed new life into the campaign. This meant that the 5% VAT rate that had applied to certain grant funded installations since 1998 was extended to include domestic installations. Materials that qualified as energy saving included insulation, draught stripping, water and central heating controls. Professionally installed photovoltiac and thermal solar panels were also included, but no provision was made for small wind or hydro.

Concerned at the omission of other renewables which are equally ‘energy saving’ and indeed more suited to the UK climate, the British Wind Energy Association and UK renewables companies, including the Scottish Company Proven, who had been campaigning hard on the issue, decided to take action. Response from the public to Proven’s web site campaign page was encouraging and local Scottish MP Des Browne lent his support along with Green MSP Robin Harper.

Proven tells us that the initial responses from HM Customs & Excise were negative but after a further meeting, the April ruling was amended. The new package received Royal Assent on 28th July. That means that the reduced rate of 5% VAT now also applies to professional installed small wind and hydro systems for domestic use.

Proven say they are delighted with what they consider to be a long overdue decision, and hope the 12.5% saving will enable more domestic consumers to take advantage of renewables.

Proven Engineering Products Ltd, Moorfield Industrial Estate, Kilmarnock, Ayrshire, KA2 OBA Tel: 01563 543020

Fax: 01563 539119 gproven@provenenergy.com

Web: http://www.provenenergy.com