Schools Lead Calls for Government to Stop Solar Tax Hike

World | Solar Energy

Photo: Pixabay

A group of children from Eleanor Palmer Primary School in Camden will this morning descend on the Treasury to deliver a petition urging chancellor Philip Hammond to halt the planned business rate tax hike that is expected to hit thousands of school solar installations.

The 194,000 signature petition was organised by Greenpeace and marks the latest call for the government to rethink planned changes to business rates that experts fear could have a major impact on the financial viability of many existing and new solar installations.

The Solar Trade Association (STA) has been warning for months that unless the government intervenes the current plans will result in business rates for solar installations rising by between 300 and 400 per cent for arrays on schools and hospitals and up to 800 per cent for arrays deployed by businesses.

The industry has warned the tax hike would deal a major blow to a sector only slowly recovering from last year’s decision by the government to slash feed-in tariff incentives.

Last autumn, the Valuations Office tweaked its original proposals to ensure sites that export a significant amount of solar power to the grid will see lower increases in their rates. However, while the industry welcomed the move it warned that smaller solar projects where the bulk of the power is used onsite were still facing a major tax rise.

Insiders also warned that unless the government rethinks the proposals companies and public sector bodies will either be discouraged from installing solar panels or will be forced to undergo arcane legal manoeuvres to ensure their panels are owned by a third party and are technically exporting their power, making them eligible for a lower level of tax.

Nina Schrank, energy campaigner at Greenpeace UK, said the government must now act to ensure the UK can take full advantage of the falling cost of solar technologies.

“Solar technology has great potential for the UK, offering new jobs, investment, and clean, competitively priced energy,” she said in a statement. “Other countries are making positive strides in harnessing the sun’s energy, but the UK government is going backwards and hitting solar champions with unfair tax hikes. Schools, hospitals and businesses have installed solar panels to generate their own clean electricity. It’s ludicrous that they should be unfairly taxed, making their solar projects financially unviable in many cases.”

Paul Barwell, CEO of Solar Trade Association, urged the chancellor to intervene personally and “drop the solar tax hike in his Budget next week”.

“If we want a modern, clean economy it makes no sense to load crippling business rates on the very people who are taking care to invest in our future,” he said. “These self-defeating proposals couldn’t come at a worse time for the solar industry – rooftop solar deployment is at a six year low. The last thing solar needs right now is an extreme and nonsensical tax hike.”

The petition comes as the Treasury also faces growing calls to introduce new measures to crack down on air pollution from diesel vehicles.

A wide range of campaigners, including health groups, environmental NGOs, taxi drivers, and London Mayor Sadiq Khan have written to the Chancellor this week calling for the government to introduce a diesel scrappage scheme to accelerate the shift to greener vehicles.

Meanwhile, the Healthy Air Coalition last week called on the Treasury to fund a new scrappage scheme by increasing first year vehicle excise duty on new diesel cars.

The Treasury was considering a response to the latest calls for it to deliver a green budget at the time of going to press.