Tax regulation mechanisms I (Reduction of environmental protection tax)
Updated: 09.01.2019
Author: Stijn Anciaux
In the Netherlands, the consumption of electricity and natural gas is subject to the Act on the Environmental Protection Tax (art. 48 (1) in conjunction with art. 50 (1) WBM). A given consumer is exempt from this tax if the electricity consumed is electricity from renewable energy sources and was generated by the consumer himself (own consumption clause) (art. 64 (1) in conjunction with art. 50 (4), (5) WBM).
Eligible technologies
The exemption from tax on electricity generated for a consumer's own use generally applies to all renewable energy generation technologies.
| Wind energy | Eligible (art. 47 (1) (i) WBM). |
|---|
| Solar energy | Eligible (art. 47 (1) (i) WBM). |
|---|
| Geothermal energy | Eligible (art. 47 (1) (i) WBM). |
|---|
| Biogas | Eligible (art. 47 (1) (i) WBM). |
|---|
| Hydro-power | Eligible (art. 47 (1) (i) WBM). In addition to traditional hydro power plants, plants generating electricity from waves and tidal flows are also eligible for tax exemption. |
|---|
| Biomass | Only electricity generated from pure biomass is eligible (art. 47 (1) (i) in conjunction with art. 50 (6) (a) WBM). |
|---|
Amount
There are several tax bands depending on the level of consumption. The amount of tax payable per 12-month period is as follows:
• Consumption of less than or equal to 10 000 kWh: €ct 10.46 per kWh (art. 59 (1) (c) WBM);
• Consumption from 10 000 kWh up to 50 000 kWh: €ct 5.27 per kWh (art. 59 (1) (c) WBM);
• Consumption from 50 000 kWh up to 10 000 000 kWh: €ct 1.40 per kWh (art. 59 (1) (c) WBM);
• Consumption of more than 10 000 000 kWh: €ct 0.12 per kWh (for private use) and €ct 0.06 per kWh (for commercial use) (art. 59 (1) (c) WBM).
Electricity from renewable sources is exempt from this tax if it is generated by the consumer himself (art. 64 (1) in conjunction with art. 50 (4), (5) WBM).
Addressees
Entitled party. The parties entitled to the tax credit are those generators of electricity from renewable energy sources that consume the electricity they generate (art. 64 (1) in conjunction with art. 50 (4), (5) WBM).
Procedure
Process flow | The claim for tax exemption has to be issued against the tax office together with the tax return. |
|---|
Distribution of costs
| State | The tax reduction is financed from the state budget of the Netherlands. |
|---|
Netherlands
