Industry calls on UK gov’t to reverse decision to remove consumer tax break for energy storage

LinkedIn
Twitter
Reddit
Facebook
Email
Image: AceOn.

UK energy storage firm AceOn has joined a call to reverse changes to Value Added Tax (VAT) rates applicable to energy storage systems that came into effect in the country in 2019.

Following the changes, the VAT rate on home energy storage jumped from 5% to 20%, a move that Richard Partington, managing director of AceOn, said has “not helped the rollout of this important renewable energy storage technology”. The higher rate is the normal amount levied onto consumer goods and services in the UK. ‘Energy saving materials’ including solar panels, wind turbines and air source heat pumps enjoy the discounted rate, but not energy storage.

This article requires Premium SubscriptionBasic (FREE) Subscription

Enjoy 12 months of exclusive analysis

  • Regular insight and analysis of the industry’s biggest developments
  • In-depth interviews with the industry’s leading figures
  • Annual digital subscription to the PV Tech Power journal
  • Discounts on Solar Media’s portfolio of events, in-person and virtual

Or continue reading this article for free

The decision faced heavy criticism when it was first announced, in particular by the Committee on Climate Change independent public body and the MCS – which oversees certfication for equipment and installation companies in the UK. It has now also prompted the Association for Renewable Energy and Clean Technology (REA) to pen an open letter, signed by over 30 industry groups, calling for this change to be reversed.

In this letter, the REA pointed to how now that the UK has left the EU, it no longer has to comply with the EU’s ruling on the matter and can set its own VAT rules. It also suggested a temporary incentive to encourage householders to install energy storage. This could be its inclusion in the Green Homes Grant or a scheme equivalent to the grants available for electric vehicle (EV) ownership.

Both the recommendation of the VAT being brought back down to 5%, as well as the temporary incentive are now also being backed by AceOn, which has now joined the other firms in signing the letter, with Partington adding that incentives for homeowners to move to renewable energy technologies “should apply equally so that the much-needed green revolution can take shape as quickly as possible.”

This story first appeared on Solar Power Portal.

24 February 2026
InterContinental London - The O2, London, UK
This isn’t just another summit – it’s our biggest and most exhilarating Summit yet! Picture this: immersive workshop spaces where ideas come to life, dedicated industry working groups igniting innovation, live podcasts sparking lively discussions, hard-hitting keynotes that will leave you inspired, and an abundance of networking opportunities that will take your connections to new heights!

Read Next

July 9, 2025
US energy storage projects that begin construction by the end of 2033 will remain eligible for investment tax credit (ITC) incentives.
July 9, 2025
A subsidiary of Turkish conglomerate Güri̇ş Group has signed an EPC contract for a 98.6MW/196.4MWh project in Romania with local firm Simtel.
July 9, 2025
UK BESS owner Gresham House Energy Storage Fund (GRID) has entered into long-term floor agreements with Statkraft and Markel Bermuda, which will partially replace its toll with Octopus once that expires next year.
July 7, 2025
EU will not meet its 2030 clean energy targets unless cumulative battery storage deployments rapidly accelerate, SolarPower Europe has said.
July 1, 2025
Battery energy storage system (BESS) developer Giga Storage has acquired a 350MW/1,400MWh BESS asset in Germany, marking an expansion into the broader European energy storage market.

Most Popular

Email Newsletter