Spring statement 2022: Everything you need to know about solar panels, insulation and heat pumps after VAT cut

Today’s Spring Statement by Chancellor Rishi Sunak stated that VAT on energy-efficient materials such as solar panels and heat pumps will be reduced from 5% to zero. Solar panels have a high initial cost, between GBP4,000 to GBP8,000. However, the incentives for installing them include lower electricity bills and a smaller carbon footprint. Any extra electricity generated is then sold back to the energy suppliers. Heat pumps and home insulation are also exempted from the five percent VAT. There are no details on which technology or models are eligible and any requirements that must be met to install solar panels in your home. On average, PV systems cost between GBP5,000 to GBP8,000 to buy and install. The Smart Export Guarantee, which requires energy suppliers pay customers for extra electricity they produce and export to the grid, is one of the incentives to get solar panels. It was introduced in 2020. This is only applicable for the electricity-generating PV panels.Homeowners choose which energy supplier to sell their extra electricity to, with estimates for how much a typical household could make usually between GBP75 a year and GBP110 a year. You must have solar panels certified to qualify and a meter to track how much electricity you export to qualify. This will depend on the angle of your roof and whether your home is in a conservation zone. The Energy Saving Trust estimates that it would take an average household between nine to 17 years to recover the cost of solar panel installation. With the energy cap increasing, this time period will decrease as electricity costs continue to rise. The appearance, efficiency and age of the panels will all have an impact on the property’s value. It is generally advised that any value added to the property will not exceed initial outgoings. They will need to be removed when you move. Their certification and tariffs will be affected by their roof position and the amount of electricity generated. You will have to search for a new tariff from another supplier. You don’t have to use the same energy suppliers for both incoming and outgoing electricity. Panels such as the medium 4-kWp system are commonly used on domestic properties. They require around 300sq feet of unshaded space. According to Checkatrade, the average cost of roof insulation labor is GBP175. Pipe insulation keeps hot water warmer for longer. It is always a good idea to avoid freezing or burst pipes during winter. The cost of insulation should start at around GBP20. The cost of insulation should start at around GBP20. They are able to reduce fuel consumption, reduce carbon emissions, heat homes, and heat hot water. For more advanced models, prices can rise to GBP20,000. It is important to insulate your home, especially the loft. According to Checkatrade, the cost of installing an air source heatpump will range from GBP3,000 to GBP18,000. Air-to-water costs an average of GBP13,000 to supply and install. For supply and installation, air-to-air costs around GBP3,100. Checkatrade spokesperson said that in the past, efficiency improvements have taken a long time to recover through energy bills. However, insulation can be a simple and cost-effective investment for homeowners, especially with rising energy costs. “”Draft regulations for Government’s Boiler Upgrade Scheme, which will launch in spring 2022, show that homeowners would need to have loft insulation installed to be eligible for a grant to heat pump or biomass boiler. It’s a good idea now to act if you want to apply for these grants.