Remove taxes on solar batteries, Govt urged

 Remove taxes on solar batteries, Govt urged

The Solar Industry Association is calling on the New Dawn administration to remove taxes on solar batteries. 

Solar Industry Association of Zambia president Matanda Mwewa said despite government having removed duties on lithium batteries, 16 percent Value Added Tax (VAT) is still expensive.

“Leadacid, a common and old technology, is exempted from VAT and duty. While we recognise that lead acid batteries still have a position in the market, we cannot ignore the fact that lead acid is an outdated technology. Lithium Iron phosphate, (LiFePO4 or LFP) batteries, may be the ideal battery chemistry for solar applications,” he said.

Mr Mwewa said the new technology is more durable, can withstand deeper cycles, has a larger energy density, and is very efficient.

“In addition, they require neither maintenance nor ventilation, unlike lead-acid batteries. Yes, Lithium batteries are initially more expensive, but due to their increased efficiency, you may spend less per kilowatt-hour of capacity over the battery’s lifetime. For instance in the life of equivalent lithium batteries capacity which is 10 years one with lead-acid batteries will change them atheist three times,” part of the statement read.

He said lithium batteries are also smart batteries as they have internal battery management systems which manage the battery cells and can digitally control inverter charging or discharge parameters ensuring that the battery operates according to manufacturer specifications.

Mr Mwewa however said not enough progress has been made for the nation to realise the vision.

He said Zambia through the implementation of earlier national development plans, which included the introduction of incentives for solar equipment, progress has been achieved towards achieving the socio-economic development objectives of vision 2030 in the energy sector.

“Zambia aligned its vision with SDG7 in order to guarantee universal access to affordable, dependable, and advanced energy services. This objective seeks to provide everyone with inexpensive, reliable, sustainable, and modern energy. Energy is a crucial accelerator for economic progress and affects all economic sectors. But with the existing duty fees placed on lithiums, it is evident that this is a barrier to achieving the electrification rate of 51 percent in rural areas and 90 percent in peri-urban and urban areas,” he said.

Mr Mwewa urged government to consider making lithium ion batteries not only VAT-free, but also duty-free for residential and commercial solar systems.

Finance Minister, Situmbeko Musokotwane is set to present the 2023 national budget this Friday.