The government's proposal to lower the electricity tax to the EU minimum level from 2026 and two years onwards is overall a good step. Today, a large share of our household electricity consumption already comes from renewable energy, and therefore the electricity tax acts de facto as a high tax on green electricity. If the green transition is to succeed, we must use more green electricity in the future – and at the same time use it efficiently. 

At the Green Transition Council, we see it as positive that the government now wants to lower the electricity tax, as it means a lower tax on green electricity. When it comes to household consumption, it can make it more attractive to invest in, for example, a heat pump rather than a gas boiler. There are already deduction schemes, but if you really want to stimulate a transition, a permanent reduction in the electricity tax would be more effective because it creates stability and security for those who have to make the major investment decisions. 

In the transport sector, the tax reduction can also contribute by making it cheaper and easier to own an electric car – especially for consumers without subscription solutions. This can help cement the positive development away from fossil-fuel cars. 

As a lever for the green transition at a societal level, however, it is necessary to look at our tax and subsidy structure more fundamentally. Today, we subsidize fossil solutions to such an extent that it hinders the electrification of both heating and industry, which is absolutely crucial to accelerate. At the same time, we must secure funds for expanding the electricity grid so that green electricity can actually be utilized effectively. 

It is positive that the government is removing a high tax on green electricity. But if electrification is to really accelerate, we must have a broader deal with taxes and subsidies, so that green choices are always the most attractive." – Britt Dam, Climate and Energy Advisor, Green Transition Denmark