Question

To ask the Secretary of State for Energy and Climate Change, with reference to the ruling of the European Court of Justice on 4 June 2015 on the UK's VAT rate on the supply and installation of energy-saving materials, what assessment she has made of (a) the implications for her policies of that ruling and (b) the effect that ruling will have on measures to improve energy efficiency.

The Government is currently considering the full implications of the decision of the European Court of Justice on the application of the VAT reduced rate to the installation of energy saving materials.

Estimates based on provisional internal analysis suggest that around 1.5% fewer households would meet the Green Deal’s Golden Rule if the VAT rate was 20% instead of 5%.

In England, most Energy Company Obligation (ECO) delivery does not involve blending with private finance or other funding streams, so there is likely to be minimal impact were there to be a VAT increase.