Battery tax exemption to fire up solar energy sector, says Hill
Published:Thursday | March 24, 2022 | 12:11 AM
The Government’s decision to exempt lithium-ion and lithium ferrophosphate batteries from general consumption tax (GCT) is being hailed by one player in the solar energy sector as a positive move.
Alex Hill, president of the Jamaica Renewable Energy Association, told The Gleaner on Wednesday that the removal of the tax by Finance and the Public Service Minister Dr Nigel Clarke would go a long way in reviving the sector and benefiting residential customers.
Clarke said that GCT will be exempted on the lithium-ion batteries in the first quarter of the new fiscal year.
In closing the 2022-23 Budget Debate in Gordon House on Tuesday, Clarke said that the popularity of the lithium-ion batteries has been growing as an energy-storage technology. He said this should help reduce the cost associated with electricity generation.
In a Gleaner interview last year, Hill complained about the imposition of the levy of 20 per cent GCT on the batteries, which had a negative impact on the renewable-energy sector.
“What has been done now is that the playing field has been levelled to allow us to bring in these products duty-free and GCT-free,” he told this newspaper Wednesday.
“We had an issue with CARICOM, and the Government resolved that, so they got us a duty-free exemption for two or three years,” he added.
Hill said that with the imposition of GCT on lithium-ion batteries last year, players in the sector had to spend between $250,000 and $300,000 for the product, noting that the additional cost had to be passed on to the clients.
“What has been done is positive. We applaud the minister of finance and the minister of energy, who we have been working closely with and the Government, because this is something that needed to be done for years, and it has finally been done now,” the renewable energy association president said.
The lithium-ion and ferrophosphate batteries store energy that is generated from solar panels.
“What it allows you to do is put the solar panels on your roof and place the battery inside the house, and when you are at work, it is charging up your battery, and in the night you can use the battery,” Hill explained.
He said that residential customers can become energy self-sufficient by acquiring the technology.
“The beauty about lithium-ion batteries is that they have a very long lifespan,” Hill said, adding that dealers are now getting 10-year warranties on the batteries from manufacturers.