Commission approves Swedish tax exemption schemes for non-food biogas and bio-propane

The European Commission has concluded that two Swedish tax exemption schemes for non-food-based biogas and bio-propane used for heating or as motor fuel are in line with EU State aid rules. In June 2020, the Commission had approved the schemes under EU State aid rules, but the Commission’s decisions were annulled by the General Court on 21 December 2022.

Following the General Court’s judgment, the Commission opened an in-depth investigation on 30 January 2024 to re-examine the compatibility of the tax exemption schemes under EU State aid rules, and in particular the 2014 EEAG and the 2022 Guidelines on State aid for climate, environmental protection and energy (‘CEEAG’).

In particular, the Commission has investigated whether the potential cumulation of aid may lead to overcompensation in favour of those producers when they sell biogas in Sweden.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “Our in-depth investigation has confirmed that these tax exemption schemes for biogas and bio-propane are in line with EU State aid rules. The measures support the consumption of sustainable fuels, thereby contributing to the transition towards a net-zero economy.”

Source: European Commission