Online message – Thursday 06/07/2023
Energy Tax Act | Compensation of heat losses in a district heating network (BFH)
Energy products that are burned to compensate for heat losses in a district heating network are also eligible under Section 54 (1) sentence 1 EnergieStG if the operator of the district heating network purchases heat from other companies and is responsible for compensating for the heat losses occurring after the transfer point (BFH, judgment of February 28, 2023 – VII R 27/20; published on July 6, 2023).
background: According to § 54 paragraph 1 sentence 1 EnergieStG, a tax relief is granted on application for energy products that have been demonstrably taxed according to § 2 paragraph 3 sentence 1 no. 1, 3 to 5 and from a company in the manufacturing industry within the meaning of § 2 No. 3 StromStG or by an agricultural and forestry company within the meaning of Section 2 No. 5 StromStG for operational purposes or used in favored systems under Section 3 EnergieStG. According to § 1a sentence 1 no. 12 EnergieStG, heating is the burning of energy products to generate heat. The person who used the energy products is entitled to a tax credit (§ 54 Para. 4 EnergieStG). According to the case law of the BFH, the claim for relief under Section 54 (1) sentence 1 EnergieStG also includes energy products for energy supply companies that were used to compensate for unavoidable heat losses (BFH, judgment of November 8th, 2016 – VII R 6/16, NV; following FG Düsseldorf, judgment of November 27th, 2019 – 4 K 2921/18 VE).
facts: The parties involved are arguing about the extent of the tax relief under Section 54 Energy Tax Act for heat losses.
The judges of the BFH continued to explain this:
Energy products that are burned to compensate for heat losses in a district heating network are also eligible under Section 54 (1) sentence 1 EnergieStG if the operator of the district heating network purchases heat from other companies and is responsible for compensating for the heat losses occurring after the transfer point .
The level of relief is limited by the amount of energy products burned by the operator of the district heating network.
The amounts of energy products eligible for tax relief for transmission losses cannot be attributed to a specific installation by way of a balance sheet assignment, but – based on the relevant district heating network – are to be distributed proportionately to the individual installations of the taxpayer according to the quantities of heat generated.
Those: BFH, judgment of February 28, 2023 – VII R 27/20; NWB database (il)
Source(s):
NWB JAAAJ-43533