100% First Year Allowances – Energy Saving Plant or Machinery Print

This scheme, along with the scheme for Environmentally Beneficial Plant (see below) is to be scrapped with effect from April 2020, and will be replaced by the Energy Transformation Fund which will be directed at businesses with high energy use.

The Enhanced Capital Allowances (“ECA”) scheme is part of the government’s programme to manage climate change by encouraging businesses to invest in energy saving equipment.

The incentive to businesses to invest in energy saving equipment is the availability of 100% first year allowances in respect of expenditure incurred on the acquisition of qualifying plant and machinery.

To qualify for this relief, the plant or machinery must be acquired unused, and not second-hand by April 2020. It must be of a description specified by Treasury order, and meet the energy saving criteria specified by Treasury order for plant or machinery of that description. The categories of energy saving plant and machinery currently  qualifying for the enhanced 100% capital allowances are:

  • Air-to-air energy recovery devices
  • Automatic monitoring and targeting (AMT) equipment
  • Boiler equipment
  • Combined heat and power (CHP)
  • Compressed air equipment
  • Heat pumps
  • Heating ventilation and air conditioning equipment
  • High speed hand air dryers
  • Lighting
  • Motors and drives
  • Pipework insulation
  • Refrigeration equipment
  • Solar thermal systems
  • Uninterruptible power supplies
  • Warm air and radiant heaters
  • Waste heat to electricity conversion equipment

A full list of the plant or machinery that qualifies, together with details of the manufacturer can be found on the government website at:


Where qualifying plant or machinery is installed as components within a larger item of plant or machinery, the expenditure relating to the qualifying plant or machinery will still qualify for the 100% First Year Allowance.

In addition to the cost of the product on the Energy Product Technology List, other direct costs may be included within the claim to ECAs, including the cost of:

  • Transportation of the equipment to the site where it is to be installed;
  • Direct installation costs, including:
    • Cranage to lift heavy equipment into place
    • Project management
    • Labour
    • Modifications to the site or existing equipment
    • Professional fees directly related to the acquisition and installation of the equipment.

The acquisition of plant and machinery on which tariffs are receivable under either the feed in tariff, or renewable heat schemes are not eligible for 100% First Year Allowances. Where no tariffs are paid, 100% First Year Allowances may be claimed.

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