Energy efficiency

A boiler scrappage scheme and tax breaks for electric cars are part of a range of “green” measures proposed this week to encourage consumers and businesses to become more energy- efficient.

Chancellor Alistair Darling on Wednesday announced plans for a green boiler incentive scheme that will pay people £400 to replace old “G-rated” boilers with the latest energy-efficient models.

Experts say G-rated boilers are likely to be more than 15 years old. Replacing one with an A-rated energy-efficient boiler could save over £200 a year in energy bills. The scheme will be available for up to 125,000 households.

In addition, £200m is to be provided from next April to help households with energy efficiency.

People who generate renewable electricity for their own use and then plug their excess power into the national grid will now be rewarded with a tax-free payment.

The government also announced a range of measures to boost take up of electric vehicles.

From April, all electric cars will be exempt from company car tax for a period of five years.

A 100 per cent first-year allowance will also be provided for the purchase of electric vans.

Helen Devenney, head
of environmental tax at Deloitte, welcomed the “green” incentives but noted that their scope remained very targeted. “I think the boiler scrappage scheme will provide a good boost to households but it’s only 125,000 households and clearly we need far more than that,” she said.

Tanya Powley