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Spring Statement: Cut in VAT welcome but it is a drop in the oceanMarch 2022

BSRIA welcomes the Chancellor’s announcement of a cut in VAT on renewables and energy efficiency improvements – including insulation for homeowners – but it feels like a drop in the ocean compared with what is needed today.

In the wake of the energy crisis, wide-scale deployment of cost-effective energy efficiency measures in buildings becomes critical to begin addressing the existential challenges faced by many businesses and households as we embark on the decarbonisation journey.

With the government's energy security strategy to be announced next week, BSRIA expects a clear and coherent focus on energy efficiency and secure energy supply.

We urge strong support for energy efficiency measures and for the delivery of a comprehensive and wider home energy efficiency scheme on a substantially larger scale.  In spring 2021, the Green Homes Grant scheme, worth two billion pounds, closed and was superseded by the Home Upgrade Grant, providing 950 million pounds until 2025 – insufficient to support the level of change required.

As energy costs are expected to surge further over the course of the year, coupled with inflation outpacing rises in income, any available funds earmarked for implementing energy efficiency measures become inadequate.  We are at a point in time where the current uncertainty around the supply and security of our energy leaves households hamstrung to make positive changes on our collective journey towards net zero. The energy security strategy should be bold enough to encourage positive behaviour and action.