A coalition of property and retail bodies has united to warn Rishi Sunak that the government’s business rate regime “disincentivises” companies from deploying rooftop solar panels which could deliver up to 30GW of renewable generation.
Chris Hewett, chief executive of the Solar Trade Association (STA), has written to the chancellor of the exchequer urging him to exempt onsite renewable energy technologies such as photovoltaic solar panels and battery storage from business rates.
The letter has also been signed by a host of other trade bodies, including the British Retail Consortium, the British Property Federation and the Construction Products Association.
The letter ties in with the close tomorrow (31 October) of a government consultation on a review of the business rates regime.
Renewable technologies have incurred “substantial” business rates, following a review of the methodology for equipment classified as “plant and machinery” in buildings in 2017, wrote Hewett.
Following this change, business rates now consume around 40 per cent of the potential cost savings of installing solar panels, undermining the business case and creating a “major barrier” to its uptake, according to the letter.
“This impacts businesses across a variety of sectors, including retail, manufacturing and tourism. The UK has approximately 250,000 hectares of south-facing commercial roof space, which could be utilised in the deployment of over 30GW of solar PV, allowing businesses to reduce their energy costs and lower their carbon footprint.
“However, many companies have mothballed plans to deploy solar on their roofs following the 2017 revaluation, which has led to a rates increase of more than 800 per cent in some cases. This has led to many wasted opportunities.
“The current business rates regime is in effect penalising those companies that are working to reduce their climate impact.”
As well as assisting the roll out of renewable technologies, exempting solar PV from business rates could deliver up to 1,800 additional jobs annually and increase investment in the UK by more than £315 million a year, the STA claimed