Tax regulation mechanism II (Energy and CO2-tax)

Updated: 17.01.2019

Author: Oskar Vågerö

In Sweden, energy and carbon dioxide taxes are levied on the supply, import and generation of fossil fuels for heating purposes. Renewable energy sources are exempt from these taxes.

Eligible technologies

All renewable energy generation technologies are eligible for tax exemption. Renewable energy sources other than biomass and biogas are not physical sources (fuels) used for generation of heating, so they are not covered under the energy tax. Biomass and biogas are explicitly excluded from the tax (Chapter 6a § 2b Act No. 1994:1776).  

Aerothermal energy

Eligible.

Biogas

Eligible. The exempt biogas must be certified with sustainability certification according to Chapter 3 § 1b Act No. 2010:598.

Hydrothermal energy

Eligible.

Biomass

Eligible. The exempt biomass must be certified with sustainability certification according to Chapter 3 § 1b Act No. 2010:598.

Geothermal energy

Eligible.

Solar thermal energy

Eligible.

Amount

The amount of subsidy is equal to the amount of taxes entitled persons are exempt from. 

Addressees

Heating from renewable sources is exempt from these taxes. Suppliers, importers and producers of heating generated from these products are exempt from paying the taxes (Chapter 4 § 1 Act No. 1994:1776).

Procedure

Competent authority

The Swedish Tax Authority (Skatteverket)

Distribution of costs

State

The costs of tax relief are borne by the state (Chapter 1 § 1 Act No. 1994:1776).

Sweden

Further information

Basic information on legal sources