On the proposal for a Council directive restructuring the Union framework for the taxation of energy products and electricity (recast)
ITRE-AD-719575
Committee on Industry, Research and Energy · Rapporteur: Robert Hajšel
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The Committee on Industry, Research and Energy gives its opinion on the proposed Council directive restructuring EU energy taxation. It backs a tax structure based on energy content and environmental performance, and proposes amendments on social reporting, energy poverty, renewables and double taxation.¶¶ It proposes a Social Monitor: Member States report every two years on social measures and revenues, and the Commission reports on energy prices and energy poverty.¶¶¶ It replaces the definition of vulnerable consumers with a quantitative definition of energy poverty, and lets Member States keep exempting such households after the transition period.¶¶¶ It makes tax exemptions for renewables mandatory, extends them to self-consumers, energy communities and purchase agreements, and bans taxation of energy use within the value chain, conversion and storage.¶¶¶ It asks the Commission to adopt a common certification framework for the origin and source of electricity consumed.¶
Committee position. The committee proposes amendments to the Commission proposal, supporting the new tax structure while adding social reporting, a quantitative energy poverty definition, mandatory renewables exemptions, a ban on double taxation and a certification framework for electricity origin.¶¶¶
Key points
- The committee supports a tax rate structure based on energy content and environmental performance, and wants no exemptions or reductions for environmentally harmful activities.¶
- It proposes a Social Monitor: Member States report every two years on social measures and on revenues used, and the Commission reports every two years on energy prices and energy poverty.¶¶¶
- It replaces the definition of vulnerable consumers with a quantitative definition of energy poverty, using criteria such as energy cost share of disposable income and housing quality.¶¶¶
- Member States shall continue to exempt households in or at risk of energy poverty after the transition period if the Social Monitor shows no significant progress.¶
- Member States shall apply exemptions or reductions for pilot projects on sustainable renewable energy products and for renewable electricity from fuel cells.¶¶¶
- Member States shall exempt energy produced, consumed, stored or shared by renewables self-consumers, jointly acting self-consumers and household and SME members of renewable energy communities.¶¶¶
- Energy taxation shall apply only to final consumption; energy use within the value chain, conversion and storage shall not be taxed, and storage facilities and electric vehicle batteries shall not face double taxation.¶¶
- The Commission shall adopt a common certification framework specifying the origin and source of electricity consumed, helped by digitalisation of grids.¶
- The annual automatic adaptation of minimum tax rates to the harmonised index of consumer prices is deleted.¶¶
- Transitional increases in minimum tax levels are fixed at one tenth per year until 1 January 2033, with the first-year level for low-carbon fuels applying until that date.¶¶¶
- Sustainable alternative fuels and electricity for intra-EU waterborne navigation, fishing and freight transport are exempted from taxation for ten years.¶
- The Commission shall report every five years to Parliament and the Council, examining minimum tax levels, carbon content, air pollution, innovation, market accessibility and cohesion effects.¶¶
Who is affected
- Households in or at risk of energy poverty: may be exempted from energy taxes for up to ten years and possibly longer.¶¶
- Renewables self-consumers, energy communities and active consumers: their self-produced electricity shall be exempt from taxation.¶¶
- Member States: must report every two years on social measures and revenues, and may keep flexibility on national tax policies.¶¶
- Energy-intensive enterprises: may receive tax reductions if they commit to climate protection and energy efficiency measures.¶
- Vehicles transporting agricultural products for food use: may get more advantageous tax rates as part of the agricultural sector.¶
Figures and deadlines
- 55% reduction in net greenhouse gas emissions by 2030 compared to 1990¶
- one tenth per year increase in minimum tax levels until 1 January 2033¶¶¶
- ten years of tax exemption for sustainable alternative fuels and electricity in waterborne navigation¶
- maximum period of ten years of exemption for households in energy poverty after entry into force¶
- below 60% of national median equivalised disposable income as a criterion for energy poverty
- market share of less than 1% in a Member State for tax reductions on energy products¶
- reporting every two years after entry into force for the Commission and Member States¶¶
- review every five years by the Commission¶