The European Commission today has adopted a proposal for a Council Decision authorising Sweden to apply a reduced electricity tax rate to electricity provided to vessels at berth in a port („shore-side electricity”). The reduced rate aims at promoting the use of shore-side electricity over the more polluting alternative of generating electricity on board which is very much used by vessels lying at berth in ports at the moment. Shore-side electricity will help to reduce local air pollution and noise in port cities and to a certain extent, CO2 emissions. In order to target vessels with significant on-board generation and limit the number of beneficiaries, Sweden intends to restrict this tax advantage to vessels of at least 400 tons as well as to supplies of shore-side electricity of at least 380 volts.

The Swedish request is in line with the EU energy Taxation Directive and with the EU policy promoting shore-side electricity as a more environmental-friendly way for ships to satisfy their electricity needs while lying at berth in ports and contributes to the EU’s environmental, health and climate policy objectives. The reduced rate will also act as an important signal for the sector to further invest in this technology. This Decision will now be discussed and authorised by EU Member States and would apply for a three years-period.