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Tax relief plea to support solar energy

Homes and businesses that install photovoltaic cells should receive tax relief, according to a new report published by the renewable energy sector.

The study by trade body the Renewable Energy Association (REA) and accountants KPMG called for a range of measures to support the solar energy sector when it loses subsidies.

Ministers this week launched a consultation on ending guaranteed rates of payment for small solar projects through Renewables Obligation Certificates, as well as on closing the subsidy scheme early for such projects.

But the REA report, UK solar beyond subsidy: the transition, said a managed approach was required to support the sector.

“The UK Government needs to consider a managed transition away from subsidies over a five-year period and beyond, rather than the immediate cessation of support that will result in job losses and industry consolidation,” says the report.

It called for:

  • Photovoltaics to be made mandatory in all new buildings through Building Regulations
  • Provision of rewards and incentives for residential dwellings to install photovoltaics through Council Tax or Stamp Duty reductions
  • Exemption from higher business rates for businesses that install photovoltaics
  • Higher Annual Investment Allowances for photovoltaics
  • Inclusion of photovoltaics in the list of technologies that are entitled to Enhanced Capital Allowances
  • Inclusion of photovoltaics in the local authority planning process
  • Implementation of net metering, to incentivise consumers to install photovoltaics

REA chief executive Nina Skorupska said: “We need to get to the low carbon economy in the most cost effective way, but to do that government and industry have to work together.

“Clear and stable policy leadership is vital, and as robust as solar is, it can still be held back just short of the finishing line by misguided government interventions.

“This report shows how close solar is to competing with traditional power generation, and with positive government decisions we can ensure the smooth transition from subsidy to business as usual.”

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