Solar Power Is No Longer Tax-Free In The UK

Andrew Follett | Energy and Science Reporter

Britain plans to raise taxes on solar panels after heavily subsidizing green energy for years.

The U.K. government plans to tax roughly 44,000 solar rooftop solar panels previously exempt from business taxes. Solar industry shed 12,000 jobs last year and its growth fell 85 percent during that time as subsidies were cut.

“This is slightly less than helpful for the British solar industry it’s absurd,” Leonie Greene, a spokesperson for Britain’s Solar Trade Association, told The Independent. “Energy tax policy is going in the opposite direction to how we know energy needs to change and how it is changing.”

Solar lobbyists aren’t the only ones upset about the new budget. The British government’s Environmental Audit Committee (EAC) said Friday it is “deeply disappointed” with the Treasury’s plans. The EAC feels the current Treasury plan prioritizes reducing power bills over environmental concerns.

The U.K.’s Department of Energy and Climate Change estimated that ending solar subsidies would save between $57 million and $142 million by 2021. But even with the cuts, green energy subsidies are still projected to increase from $2.8 billion annually in 2012 to $10.8 billion in 2021. That’s quite a lot of money for Great Britain, which ran a deficit of $92 billion in 2016.

Britain’s ruling Conservative Party has said for years it plans to cut green energy subsidies to protect consumers and the industry from expensive energy bills.

U.K. residents already pay a whopping 54 percent more for electricity than Americans, and energy taxes to support green power cost residents roughly $6.6 billion every year. Green energy subsidies in the U.K regularly exceed spending caps and account for roughly 7 percent of British energy bills, according to a government study released in July.

Polling indicates that 38 percent of British households are cutting back essential purchases, like food, to pay for high energy bills. Another 59 percent of homes are worried about how they are going to pay energy bills. Companies are getting hit by pricey British electricity as well, and some are even leaving the country because of it, threatening up to 40,000 jobs.

A single piece of government legislation, the U.K.’s Climate Change Act of 2008, is estimated to cost the average British household about $13,703 by the year 2030, according to a report by The Global Warming Policy Foundation (GWPF). The total costs of the policy will eventually add up to three times the annual British National Health Service (NHS) budget.

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