But in an amendment to the Finance Bill, a cross party group of MPs objected to the move and now Downing Street has said it will not oppose an amendment to the Bill to retain the five per cent sweetener for going green.
And, at the same time, the European Commission has said it will bring forward proposals to allow "flexibility" in the VAT rates applied to different products within EU countries.
"We are delighted that it appears the five per cent reduced rate on renewables may be here to stay. Putting up the rate would fly in the face of attempts to promote sustainable living and thwart the drive towards hitting the UK's carbon reduction target."
Yorkshire Heat Pumps can be found at Unit 3a and 3b Follifoot Ridge Business Park, Pannal Road, Harrogate and online at www.yorkshireheatpumps.co.uk.