Households could pay more as clean energy installations lose VAT relief in April

The government plans to end the 5% VAT exemption for home heat pumps, solar panels and batteries from 1 April. Industry groups and the Liberal Democrats are urging ministers to reverse the decision, warning that it could raise costs for households and disrupt a growing market just as demand for alternatives to gas is rising.

The Liberal Democrats estimate that a household installing an air-source heat pump, a 4kW solar system and a home battery could pay £1,530 more. Industry representatives say the deadline may prompt a rush of bookings, while uncertainty over installations delayed beyond April could leave customers facing unexpected bills. The article also reports that the government plans to reduce heat pump grant funding and cut additional support for heating oil users.