“Perverse” EU decision could increase cost of energy saving measures for UK households
SEA urges UK Government to stand up to Brussels on energy laws
An EU ruling yesterday means UK households could face paying more for energy- and money-saving measures, including insulation and solar panels – in a move that has been labelled “hypocritical” by industry leaders.
The European Court of Justice upheld a legal attempt by the EU Commission to outlaw reduced rates of VAT on energy saving products for the home.
Against a back-drop of stringent EU energy reduction targets, this decision appears to contradict efforts to help consumers reduce their energy consumption and bills by making their homes more efficient.
Urging the UK government to take a stand and find a way to fight the decision, Dave Sowden from industry group The Sustainable Energy Association (SEA), says:
“This is an action by the EU Commission of the most astonishing hypocrisy. In one breath, the Commission and the EU Institutions implore Member States to take efficiency and sustainable energy more seriously – yet in the next, they use legal means to try to abolish the very policies the UK has in place to achieve this.”
“This perverse decision will have no impact whatsoever on cross-border trade between the UK and the rest of the EU. It is an epic example of Europe meddling in domestic policy for no trading benefit whatsoever. In fact, it is contrary to almost every principle and policy created to reduce consumers’ energy consumption, cut emissions and help boost economic recovery across the EU.”
“At the SEA, we are urging the UK government to act now. We believe there are strong legal reasons to retain the reduced VAT rate, enabling hard-pressed consumers to cut fuel bills without paying more to do it. We need to stand up to Brussels on this and find legal means of preserving most of our reduced VAT rates. The new government should make this an essential part of an ambitious strategy to drastically improve the efficiency of our buildings – and ultimately help consumers to permanently reduce their bills.”
Notes to editors
- The European Court of Justice ruled on 4 June 2015 that the UK was not compliant with EU law in allowing a reduced rate of VAT to apply to certain energy saving materials, from insulation to rooftop solar panels. The full list of technologies that qualify for the reduced rate of 5% (as compared to the standard rate of 20%) is available from HMRC.
- The Sustainable Energy Association and a wide range of partners launched a Private Members Bill Campaign on 3 June 2015 to promote the “Cost Effective Energy Measures Bill” which would require the UK Government to base a new Energy White Paper on a full cost and benefit analysis of all measures available to meet the UK’s various energy policy objectives. The SEA expects that Building-level measures such as energy efficiency, low carbon and renewable heating and rooftop solar PV, will rank more cost effectively than many options for large scale power generation in a like-for-like analysis.
- The Sustainable Energy Association is a member based industry body offering innovative policy solutions that link up building-level technologies and the wider energy system to achieve a low carbon, secure energy future for the UK, benefits for UK consumers, and commercial growth for businesses working in the sector. See more at: http://sustainableenergyassociation.com/
- The SEA manifesto, published in July 2014, calls on UK Government to adopt a renewed approach to energy policy including specific proposal for:
- Making large scale investment in the retrofit of buildings a National Infrastructure Priority and the economic case for doing so.
- An Energy in Buildings Strategy including cross-department approach and whole building approach.
- Proposals for deep retrofit of buildings and for the future of heating including the Renewable Heat Incentive.
- Energy systems proposals including the ‘smart’ agenda.
Dave Sowden, Chief Executive – 07836 231848, or firstname.lastname@example.org