Is electricity generation taxable?

In this way you avoid the electricity tax for self-consumption from a decentralized energy supply

Would you like to supply yourself with environmentally friendly and inexpensive electricity at your company's location? E.g. through a PV system or a combined heat and power unit (CHP)? Or do you already operate such systems? Then you should keep an eye on the electricity tax! Because electricity that is generated and consumed locally in decentralized generation plants of up to 2 MW is generally exempt from electricity tax. That saves 2.05 ct for every kilowatt-hour you use yourself and has a decisive influence on profitability. In the case of a medium-sized CHP unit, for example, this can quickly amount to 60,000 euros per year or more. But be careful: There are a few subtleties to consider. Above all, the prior authorization requirement introduced in July 2019. Without a corresponding application or permit, you pay the full electricity tax, even if you would actually be exempt! This article gives an overview of the most important regulations and shows how you can do everything correctly.

The most important regulations on electricity tax exemption for personal consumption

The main issues relating to the electricity tax exemption are regulated by Section 9 (1) of the Electricity Tax Act (StromStG). According to this, electricity that is taken from renewable energies or highly efficient CHP plants with an output of up to 2 MW on site (i.e. in spatial context) for self-supply or delivery by third parties is exempt from electricity tax. This also applies to renewable energy systems that are larger than 2 MW. However, only if the electricity is actually consumed by the operator of the system on site, i.e. there is no delivery to third parties. Until June 2019, this exemption worked automatically for the operators of the systems.

Since July 1, 2019, however, a change in the law has been in effect that makes it mandatory to actively obtain a prior, formal individual permit from the responsible main customs office. This also affects existing systems and existing delivery relationships. In order to actually (continue to) benefit from the electricity tax exemption, a corresponding application must be submitted to the main customs office. Only electricity from small, highly efficient CHP systems up to 50 kW and from renewable energy systems with a nominal output of up to 1 MW remain generally exempt. There is also no obligation to apply for these systems.

For all others, the following applies: If the main customs office does not have permission to withdraw electricity tax-exempt, the electricity tax must be paid in full by the operator of the system, i.e. at the standard tax rate of 2.05 ct / kWh (corresponds to € 20.50 / MWh). To do this, the operator has to determine the corresponding amount of electricity and report it to the main customs office for tax purposes. And retroactively from July 1st, 2019!

Tip: Do you have this Forgotten application or not on time asked, you can get the Electricity tax may be reimbursed. Read more about this later in this post.

The following infographic summarizes the points mentioned clearly:

Deadlines, application and forms for exemption from electricity tax

In order to benefit from the electricity tax exemption, a one-time application must be submitted to the responsible main customs office. The application must be made using Form 1422; As a rule, an operating declaration according to form 1422a (including additional sheet 1422az) must also be submitted. You can find all forms at https://www.formulare-bfinv.de/

  • Select "Taxes" in the menu on the right
  • Accept query
  • Select "Forms A-Z" in the navigation bar on the left
  • Select the folder "Stromsteuer" under the letter "S"

The permit can be granted (retrospectively) at the earliest upon receipt of this application by the main customs office. For new systems, the application should therefore be submitted by the commissioning date at the latest. Clarify this obligation and all other regulatory requirements as early as possible in order to avoid unnecessary payments. The opti.node Analyzer software can do this for you automatically and checks quickly and reliably during the planning phase whether there is a right to an exemption from electricity tax and which other claims or obligations may have to be observed.

There was a transition period until December 31, 2019 for existing systems. In concrete terms, this means: Anyone who applied for a permit by December 31, 2019 has been continuously exempt from electricity tax since July 1, 2019.

However, if you missed this deadline on December 31, 2019, you must first pay the electricity tax until the application has been submitted and approved. However, there is the possibility of retrospectively reimbursing the (too much) paid electricity tax. For this purpose - in addition to the above-mentioned application for permission - a separate application for tax relief must be submitted to the main customs office by December 31, 2020 at the latest (or one calendar year later). Form 1470 must be used for renewable energy systems; for CHP systems Form 1471. These forms can also be found at: https://www.formulare-bfinv.de/. The possibility of subsequent reimbursement is only available for electricity that was used for personal consumption. Electricity that was supplied to third parties on site cannot be exempted or reimbursed retrospectively in this way via a relief from the electricity tax!

Ongoing recording and documentation obligations for electricity tax

Not to be forgotten are the ongoing recording and documentation obligations resulting from the use of the electricity tax exemption. These can sometimes be extremely extensive and must be made available in detail to the main customs office on request. This applies in particular if several different systems are operated and / or other locations have to be taken into account. In principle, accounting evidence must be kept showing the amount of electricity and the precise purpose of the electricity. Against this background, for example, at least the following must be recorded separately for power generation systems:

  • Asset number (s);
  • If applicable, proof of the spatial context and details of the power generation unit in which the power was generated;
  • Total amount of electricity generated in the calendar year in kWh;
  • Total amount of electricity fed in in kWh, separated according to feed into customer systems, closed distribution networks or the general supply network;
  • If applicable, the amount of electricity fed in in kWh for the purpose of receiving funding under the Renewable Energy Sources Act (EEG) or the Combined Heat and Power Act (KWKG) - also on a commercial balance sheet basis;
  • Tax-free amount of electricity withdrawn in kWh as part of the permit

A clean and legally compliant recording or archiving is easy with the opti.node Manager software. With this software it is also possible to automate the entire energy law and commercial management of decentralized energy generation. To this end, the opti.node manager continuously monitors all changes in the relevant laws and automatically informs the user about new or no longer applicable obligations. In addition, the required forms are provided and pre-filled with the correct data. Convince yourself of the advantages and let us advise you without obligation!