The cost of installing solar panels could be reduced by as much as €1,000, under plans to be introduced by Minister for the Environment Eamon Ryan.
The savings will come from the abolition of VAT on the supply and installation of solar panels on homes and public buildings, which will be brought to Cabinet later this week.
The Green Party leader said the cost of an average installation will go from €9,000 to €8,000 - resulting in the payback period recycling from seven years to 6.2 years.
He said given that the SEAI already provides a grant for solar installation of up to €2,400, it means the total average home solar installation will come down to about €5,600.
There are almost 50,000 Irish homes with solar panels already – a number that is expected to grow at an increasing pace as the technology becomes cheaper and more mainstream.
Minister Ryan said: "This welcome Government move is yet another step on Ireland's journey to cleaner, cheaper, renewable energy."
He added: "It also comes as we begin our major plans to put solar panels on all of our schools by 2025, starting this summer break.
The VAT change in Ireland will be introduced in the Spring Finance Bill following a recent amendment to the EC VAT Directive.
