Proposal for a COUNCIL IMPLEMENTING DECISION authorising Germany to apply a reduced rate of taxation to electricity directly provided to vessels at berth in a port, in accordance with Article 19 of Directive 2003/96/EC
Date: 2026-05-22
Institutions: Directorate-General for Taxation and Customs Union, European Commission
Subjects: Germany, electrical energy, electricity supply, excise duty, harbour installation, tax relief, vessel

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   EUROPEAN COMMISSION  Brussels, 22.5.2026  COM(2026) 244 final 2026/0121 (NLE)  Proposal for a COUNCIL IMPLEMENTING DECISION authorising Germany to apply a reduced rate of taxation to electricity directly provided to vessels at berth in a port, in accordance with Article 19 of Directive 2003/96/EC  
 
EXPLANATORY MEMORANDUM 

1. 

• 

CONTEXT OF THE PROPOSAL 

Reasons for and objectives of the proposal 

Taxation  of  energy  products  and  electricity  in  the  Union  is  governed  by  Council  Directive 
2003/96/EC of 27 October 2003 restructuring the Community framework for the taxation of 
energy products and electricity 1 (the ‘Energy Taxation Directive’ or the ‘Directive’).  

Pursuant to Article 19(1) of the Directive, in addition to the provisions laid down in particular 
in Articles 5, 15 and 17 of that Directive, the Council, acting unanimously on a proposal from 
the  Commission,  may  authorise  any  Member  State  to  introduce  further  exemptions  or 
reductions in the level of taxation for specific policy considerations.  

By virtue of Council Implementing Decision (EU) 2020/1436 of 7 October 20202 (preceded 
by  Council  Implementing  Decision  2014/722/EU  of  14  October  20143  and  Council 
Implementing Decision 2011/445/EU of 12 July 20114), Germany has already been authorised 
to apply a reduced rate of electricity taxation to electricity directly supplied to vessels, other 
than private pleasure craft5, berthed in ports (‘shore-side electricity’).  

The objective of this proposal is to extend that authorisation as requested by Germany, given 
that the current derogation expired on 31 December 2025.  

By  letter  of  26  August  2025,  the  German  authorities  informed  the  Commission  of  their 
intention to prolong the current measure until 31 December 2029. Additional information was 
provided by letter of 23 January 2026.  

Germany  is  seeking  for  a  renewal  of  the  authorisation  to  apply  a  reduced  tax  rate  of  EUR 
0.50/MWh to shore-side supply of electricity to vessels6 operating exclusively for commercial 
purposes  in  Union  sea  and  inland  waters  (including  fishing)7.  This  amount  is  equal  to  the 
minimum rate of taxation for electricity for business use as laid down in the Directive. 

The  period  of  validity  requested  is  from  1  January  2026  until  31  December  2029.  This 
continues the current derogation and is within the maximum period allowed by Article 19 of 
the Energy Taxation Directive.  

1 
2 

3 
4 
5 

6 

7 

L 

19 

Directive 

331, 
connection 

12.10.2020, 
p. 
to  Corrigendum 

OJ L 283, 31.10.2003, p. 51, ELI: http://data.europa.eu/eli/dir/2003/96/oj 
Council  Implementing  Decision  (EU)  2020/1436  of  7  October  2020  authorising  Germany  to  apply  a 
reduced rate of taxation to electricity directly provided to vessels at berth in a port, in accordance with 
(OJ 
Article 
ELI: 
2003/96/EC 
of  Directive 
http://data.europa.eu/eli/dec_impl/2020/1436/oj) 
to  Council 
in 
Implementing Decision (EU) 2020/1436 of 12 October 2020 authorising Germany to apply a reduced 
rate of taxation to electricity directly provided to vessels at berth in a port, in accordance with Article 19 
ELI: 
of 
http://data.europa.eu/eli/dec_impl/2020/1436/corrigendum/2020-10-16/oj ) 
OJ L 300, 18.10.2014, p. 55 
OJ L 191, 22.07.2011, p. 22 
The  term  ‘private  pleasure  craft’  is  defined  in  Article  14(1)(c),  second  subparagraph  of  Directive 
2003/96/EC 
Identified in the request as all motor-powered ships, boats and floating structures covered by Chapter 89 
of the Combined Nomenclature. 
As specified in the national law, the measure does not apply to shore-side electricity supplied to water-
borne vessels during their stay in a shipyard. 

2003/96/EC 

16.10.2020 

342, 

(OJ 

30, 

31 

p. 

L 

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This reduction aims to continue to provide an economic incentive for the deployment and use 
of shore-side electricity in order to reduce air pollution in port cities, improve local air quality 
and reduce noise for the health benefit of inhabitants.  

The measure to be applied by Germany also has the objective of reducing the environmental 
impact of water-borne transport.  

With the requested measure Germany wants to continue offering an incentive for using shore-
side electricity which is considered a less polluting alternative to the generating electricity on 
board vessels at berth in a port. As indicated in the request, the standard rate of electricity tax 
in Germany is EUR 20.50/MWh. The tax reduction currently stands at EUR 20.00/MWh. This 
means that beneficiaries are charged EUR 0.50/MWh, the EU minimum tax rate for electricity 
applicable under the Energy Taxation Directive (as specified in Article 10(1) and Table C of 
Annex I, for business use). Germany allows the tax advantage to be provided as a reduced tax 
rate charged at supply (requiring permission), or as a tax refund. 

On  the  other  hand,  according  to  Article  14(1)(c)  of  the  Energy  Taxation  Directive  Member 
States  must  exempt  energy  products  used  to  produce  electricity  on  board  ships  at  berth  in 
ports. They may also do so if electricity is produced on board ships for navigation on inland 
waterways  according  to  Article  15(1)(f)  of  the  Directive.  Germany  has  confirmed  that  it 
transposed this latter optional exemption.        

The  German  authorities  have  indicated  that  the  tax  reduction  applies  to  all  ships  other  than 
private pleasure craft, meaning that all ships involved in commercial navigation, regardless of 
size or flag, can benefit from the tax reduction. There is however no obligation for vessels to 
use shore-side electricity.  

As indicated in the request, in 2024 a total of 28 companies claimed the tax relief. In addition, 
the German Federal Navy is supplied with shore-side electricity at eight sites. More than 400 
fixed  or  mobile  shore-side  electricity  facilities  exist  in  Germany  at  berths  in  sea  and  inland 
ports. In 50 sea and inland ports (additional) shore-side facilities are either planned or under 
construction. 

To estimate the tax expenditures from the measure, the German authorities calculated the loss 
of tax revenue based on the amount of electricity consumed for the benefit and the amount of 
the advantage. The tax relief currently amounts to EUR 20.00/MWh (the standard tax rate, as 
mentioned before, is EUR 20.50/MWh).  

In  2024,  some  74 100  MWh  of  electricity  was  either  supplied  at  the  preferential  rate  or 
benefited  from  tax  relief.  This  resulted  in  a  loss  of  tax  revenue  for  2024  amounting  to 
approximately EUR 1.48 million. 

Germany  has  requested  that  the  authorisation  be  granted  until  31 December  2029,  starting 
from  1 January 2026, without interrupting the current  derogation and  without  exceeding the 
maximum period indicated in Article 19(2) of the Directive. 

With  the  tax  reduction,  Germany  wants  to  provide  an  incentive  for  vessel  operators  to  use 
shore-side electricity in order to reduce airborne emissions and noise from the combustion of 
fuels by vessels at berth, as well as CO2 emissions. Applying a reduced tax rate strengthens 

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the  competitiveness  of  shore-side  electricity  compared  to  burning  bunker  fuels  on  board, 
which is exempt from energy excise taxation. 

The  German  authorities  consider  that  the  scheme  meets  the  conditions  of  Article  44  of 
Commission Regulation 651/2014/EU declaring certain categories of aid compatible with the 
internal market in application of Articles 107 and 108 of the Treaty8. The German authorities 
therefore  did  not  formally  notify  the  scheme  to  the  Commission  but  instead  transmitted  an 
information  summery  of  the  scheme  via  the  Commissions’  electronic  notification  system  as 
part  of  their  reporting  obligation  required  under  Article  11  of  Commission  Regulation 
651/2014/EU on 1 July 20249. 

• 

Consistency with existing policy provisions in the policy area 

Taxation of electricity is governed by Directive 2003/96/EC, in particular Article 10. Article 
14(1)(c)  provides  for  an  obligatory  tax  exemption  for  electricity  produced  on  board  a  craft. 
Articles  5,  15  and  17  provide  for  the  possibility  for  Member  States  to  apply  tax 
differentiations, including exemptions and reductions, to certain uses of electricity. However, 
as such, these provisions do not provide for reduced taxation of shore-side electricity.  

Provisions under the Energy Taxation Directive  

Article 19(1), first subparagraph, of the Directive reads as follows:  

In addition to the provisions set out in the previous Articles, in particular in Articles 
5, 15 and 17, the Council, acting unanimously on a proposal from the Commission, 
may authorise any Member State to  introduce further exemptions or  reductions for 
specific policy considerations.  

By means of the tax reduction in question, the German authorities are pursuing the objective 
of  continuing  to  promote  an  environmentally  less  harmful  way  for  ships  to  satisfy  their 
electricity needs while at berth in ports, and thus of improving local air quality and reducing 
noise. 

The  Commission  has  already  recommended  using  shore-side  electricity  as  an  alternative  to 
generating  electricity  on  board  vessels  at  berth  and  has  thus  recognised  its  environmental 
advantages10. 

Currently the standard rate for electricity is EUR 20.50/MWh, while the tax concession stands 
at EUR 20.00/MWh. Beneficiaries are thus charged at the EU minimum tax rate for electricity 
of EUR 0.50/MWh under the Energy Tax Directive. This can therefore continue to contribute 
to the stated policy objective. 

OJ L 187, 26.6.2014, p. 1 
Stromsteuerermäßigung auf direkt am Liegeplatz im Hafen an Schiffe gelieferten elektrischen Strom 

8 
9 
(landseitige Elektrizität) [BMF, Zoll], information summary transmitted to the Commission via the 
Commissions’ electronic notification system on 01.07.24,  https://competition-
cases.ec.europa.eu/cases/SA.114829. 
10 

Commission Recommendation 2006/339/EC of 8 May 2006 on the promotion of shore-side electricity 
for use by ships at berth in Community ports (OJ L 125, 12.5.2006). 

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The possibility of allowing favourable tax treatment for shore-side electricity can be provided 
for under Article 19 of the Directive since its purpose is to allow Member States to introduce 
further exemptions or reductions for specific policy considerations. 

Germany  has  requested  that  the  measure  apply  for  a  duration  within  the  maximum  period 
allowed by Article 19(2), i.e. four years. In principle, the measure must remain in force for a 
sufficiently long period to have a positive impact on investment decisions for investments in 
shore-side  electricity  facilities  by  port  operators,  and  in  on-board  equipment  by  ship 
operators. 

However,  the  derogation  should  not  undermine  future  developments  of  the  existing  legal 
framework  and  should  take  into  account  the  ongoing  revision  of  the  Energy  Taxation 
Directive  and the possible adoption by the Council of a legal act based  on the Commission 
proposal for recast of the Energy Taxation Directive11. 

In particular, as part of the proposed recast of the Directive on the taxation of energy products 
and electricity, the Commission has, among others, made provision for all Member States to 
apply  exemptions,  partial  exemptions  or  reductions  in  the  level  of  taxation  to  electricity 
supplied directly to vessels berthed in ports, in order to encourage its development and use. 

Under these circumstances, it appears appropriate to grant the authorisation for the period in 
question. 

State aid rules  

The reduced tax rate of EUR 0.50 per MWh envisaged by the German authorities is equal to 
the  EU  minimum  level  of  taxation  for  electricity  for  business  use  pursuant  to  Article  10  of 
Directive 2003/96/EC.  

Article 44 of Commission Regulation 651/2014/EU sets out the conditions under which aid in 
the  form  of  reductions  in  environmental  taxes  fulfilling  the  conditions  of  Directive 
2003/96/EC can be exempted from the State aid notification requirement.  

The German authorities indicate that the current scheme and its predecessor schemes meet the 
conditions of Article 44 of Commission Regulation 651/2014/EU. The scheme was therefore 
not  notified  to  the  Commission.  Germany  did  however  on  1  July  2024  transmitted  the 
information summary via the Commissions’ electronic notification system as required under 
Article 11 of Commission Regulation 651/2014/EU.  

The  proposal  for  a  Council  implementing  decision  does  not  prejudge  the  Member  State’s 
obligation  to  ensure  compliance  with  State  aid  rules.  The  proposal  for  a  Council 
implementing decision is also without prejudice to the Member State’s obligation to notify the 
aid  to  the  Commission  before  putting  it  into  effect,  pursuant  to  Article  108(3)  of  TFEU, 
should the new aid not be covered by Commission Regulation 651/2014/EU. 

• 

Consistency with other Union policies 

Environment and climate change policy  

11 

COM/2021/563  final:  Proposal  for  a  Council  Directive  restructuring  the  Union  framework  for  the 
taxation of energy products and electricity (recast). 

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The requested measure concerns mainly the EU’s environment and climate change policy. As 
the  measure  will  help  reduce  the  burning  of  bunker  fuels  on  board  vessels  in  ports,  it  will 
contribute  to  the  objective  of  improving  local  air  quality  and  reducing  noise.  Directive 
2008/50/EC  on  Ambient  Air  Quality12  requires  Member  States  to  ensure  that  the  levels  of 
several  air  pollutants  are  kept  below  the  limit  values,  target  values  and  other  air  quality 
standards  laid  down  in  that  Directive.  This  means  that  Member  States  are  required  to  find 
solutions to problems such as emissions of ships at berth in ports where this is relevant. It is 
conceivable that in ports where these problems exist, the use of shore-side electricity will be 
further  encouraged  as  one  aspect  of  the  overall  air  quality  strategy.  The  use  of  shore-side 
electricity is also encouraged under Directive (EU) 2016/80213 regulating the sulphur content 
in marine fuels. 

By prolonging the requested measure, Germany intends to continue to incentivise the use of 
shore-side electricity as  an environmentally friendlier alternative to generating electricity on 
board ships while at berth in a port. 

As  the  German  authorities  stress,  the  use  of  shore-side  electricity  instead  of  on-board 
generators  can  result  in  lower  emissions  of  air  pollutants,  such  as  nitrogen  and  sulphur 
dioxides, fine particulate matter and heavy metals, as well as significant  reductions in noise 
pollution  in  some  cases.  Given  that  more  stringent  air  quality  limit  values  will  apply  from 
2030  onwards14,  shore-side  electricity  can  be  expected  to  take  on  more  importance  as  a 
measure for reducing emissions. 

The  use  of  shore-side  electricity  connections  will  not  only  reduce  airborne  pollutants, 
particulate matter and soot but is also likely to lead to a reduction in CO2 emissions. This is 
because  the  electricity  mix  from  the  onshore  grid  in  Germany  is  less  carbon  intensive  than 
electricity produced on board by burning bunker fuels, due to higher energy system efficiency 
and the difference in input fuels used. 

Specific data provided by the port of Hamburg for 2024 suggests that the following emission 
savings  could  be  achieved  by  purchasing  shore-side  electricity  exclusively  from  alternative 
energy sources: 

– 

– 

– 

– 

4 327 g CO2 t/a, 

78.9 g SOx t/a, 

2.6 g NOx t/a, and 

1.2 PM t/a. 

Energy policy  

12 

13 

14 

Directive 2008/50/EC of the European Parliament and of the Council of 21 May 2008 on ambient air 
quality and cleaner air for Europe (OJ L 152, 11.6.2008, p 1). 
 Directive (EU) 2016/802 of the European Parliament and of the Council of 11 May 2016 relating to a 
reduction in the sulphur content of certain liquid fuels (OJ L 132, 21.5.2016, p. 58). 
Directive  (EU)  2024/2881  of  the  European  Parliament  and  of  the  Council  of  23  October  2024  on 
ambient air quality and cleaner air for Europe (recast) (OJ L 2024/2881, 20.11.2024) 

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The  measure  is  in  line  with  Regulation  (EU)  2023/1804  of  13 September 202315  on  the 
deployment  of  alternative  fuels  infrastructure  and  repealing  Directive  2014/94/EU16.  That 
Regulation  addresses  the  issue  of  installing  shore-side  electricity  supply  facilities  in  ports 
where there is demand for such facilities and the costs are not disproportionate to the benefits, 
including  environmental  benefits.  A  similar  measure  has  also  been  assessed  as  helping  to 
achieve the objectives of Union policies and legislation  aiming  to  reduce the environmental 
footprint  of  maritime  transport  and  helping  to  develop  certain  economic  activities  under 
Article 107(3)(c) TFEU17. 

One major reason for the unfavourable competitive position of shore-side electricity is the fact 
that electricity produced on board vessels while in maritime ports currently enjoys a full tax 
exemption.  Not only  is  the bunker fuel  that  is  burnt to  generate the electricity  exempt from 
taxation,  which  corresponds  to  the  normal  situation  under  Article 14(1)(a)  of  Directive 
2003/96/EC, but also the electricity produced on board the vessels is itself exempt18. Although 
the  latter  exemption  seems  difficult  to  reconcile  with  the  environmental  objectives  of  the 
Union, it is a matter of practicability. In fact, taxing the electricity produced on board would 
require the shipowner  –  often established in a third country  – or the operator to  declare the 
amount of electricity consumed. In the declaration, they would furthermore have to determine 
the share of the electricity consumed in the territorial waters of the Member State where the 
tax is due. It would create a huge administrative burden for shipowners to have to make such 
declarations  for  every  Member  State  whose  territorial  waters  are  concerned.  Analogous 
considerations apply to inland navigation and to the optional tax treatment in accordance with 
Article 15(1)(f) of the Directive, which is implemented by Germany. Given the exemption of 
the fossil route of electricity generation on board ships, there is justification for not penalising 
the  less  polluting  alternative  of  shore-side  electricity  by  allowing  Germany  to  continue  to 
apply a reduced rate of taxation. 

Transport policy  

The measure is in line with Commission recommendation 2006/339/EC on the promotion of 
shore-side  electricity  for  use  by  ships  at  berth  in  Union  ports19  and  with  the  Commission 
Communication  Strategic  goals  and  recommendations  for  the  EU's  maritime  transport 
policy20.  

Moreover, in accordance with Regulation (EU) 2023/1805 of the European Parliament and of 
the Council of 13 September 2023 on the use of renewable and low-carbon fuels in maritime 
transport,  and  amending  Directive 2009/16/EC21,  from  2030  onwards  vessels  classified  as 
cruise  ships,  ferries  and  container  ships  above  5,000  gross  tonnage  are  required  to  use 

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17 

18 
19 

20 

21 

OJ L 234, 22.9.2023, p. 1. 
OJ L 307, 28.10.2014, p. 1 
Commission Decision C(2024) 3934 final of 17.6.2024 in State aid case SA.105117 (OJ C/2024/5376, 
3.9.2024). 
Article 14(1)(c) of Directive 2003/96/EC. 
Commission Recommendation 2006/339/EC of 8 May 2006 on the promotion of shore-side electricity 
for use by ships at berth in Community ports (OJ L 125, 12.5.2006) 
Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic  and  Social  Committee  and  the  Committee  of  the  Regions  –  Strategic  goals  and 
recommendations for the EU's maritime transport policy  until 2018, COM(2009) 8 final of 21 January 
2009 
OJ L 234, 22.09.2023, p. 48 

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Onshore Power Supply systems, except in cases where zero-emission technology is available 
to them.  

Internal market and fair competition  

As regards the internal market and fair competition, the measure only reduces the existing tax 
distortion  between  two  competing  sources  of  electricity  for  boats  at  berth,  i.e.  on-board 
generation and shore-side electricity, which is caused by the tax exemption for bunker fuels. 

The  German  authorities  observe  that  the  tax  concession  for  shore-side  electricity  does  not 
confer  any  advantage  on  the  vessel  operators  benefiting  from  it,  which  could  disturb  the 
internal  market.  Substituting  shore-side  electricity  for  electricity  produced  on  the  vessels 
themselves does not have any saving effect. The costs of shore-side electricity in Germany are 
currently higher than the costs of self-generated electricity, even taking into account the tax 
advantage. 

Furthermore,  access  to  shore-side  electricity  will  be  available  for  the  ships  concerned 
regardless  of  their  flag.  It  will  not  lead  to  national  economic  operators  receiving  more 
advantageous tax treatment than their competitors from other EU Member States. 

Concerning competition between ports, it can be expected that any potential impact on trade 
between  Member  States,  which  could  result  if  vessels  alter  their  routes  because  of  the 
possibility to consume shore-side electricity at a reduced tax rate, will be negligible. As stated 
above, the use of shore-side electricity is, at least in the short term, unlikely to become more 
economical than on-board generation in spite of the tax reduction. Thus, this tax reduction for 
shore-side  electricity  is  also  unlikely  to  significantly  distort  competition  between  ports  by 
inducing vessels to change their itinerary due to the availability of this option. 

The  German  authorities  argue  that  other  factors  (such  as  the  type  of  ship  and  cargo,  the 
hinterland  connections  available  and  other  economic  factors)  play  a  role  in  selecting  ports. 
The mere availability of shore-side electricity does not seem to be decisive. 

The German authorities stress additionally that the use of shore-side electricity is also limited 
because there are no internationally agreed technical  standards for connecting vessels to  the 
electricity grid and, in some cases, there is no shore-side electricity supply capacity. 

Unless there are significant changes in the current framework and situation, the timeframe for 
prolonging  the  authorisation  to  apply  a  reduced  tax  rate  makes  it  unlikely  that  the  analysis 
conducted in the preceding paragraphs will change before the measure expires. 

2. 

• 

LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY 

Legal basis 

Article 19 of Council Directive 2003/96/EC 

• 

Subsidiarity (for non-exclusive competence)  

The field of indirect taxation covered by Article 113 TFEU is not in itself within the exclusive 
competence of the European Union within the meaning of Article 3 TFEU.  

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However,  pursuant  to  Article  19  of  Directive  2003/96/EC,  the  Council  has  been  granted  an 
exclusive competence, as a matter of secondary law, to authorise a Member State to introduce 
further exemptions or reductions within the meaning of that provision. Member States cannot 
therefore substitute themselves for the Council. As a result, the principle of subsidiarity is not 
applicable  to  the  present  implementing  decision.  In  any  event,  since  this  act  is  not  a  draft 
legislative act, it should not be transmitted to national Parliaments pursuant to Protocol No 2 
to the Treaties for review of compliance with the subsidiarity principle.  

• 

Proportionality 

The proposal respects the principle of proportionality. The tax reduction does not exceed what 
is necessary to attain the objective in question. 

• 

Choice of the instrument 

The  instrument  proposed  is  a  Council  implementing  decision.  Article  19  of  Directive 
2003/96/EC makes provision for this type of measure only. 

3. 

• 

RESULTS 
CONSULTATIONS AND IMPACT ASSESSMENTS 

EX-POST 

EVALUATIONS, 

OF 

STAKEHOLDER 

Ex-post evaluations/fitness checks of existing legislation 

The measure does not require the evaluation of existing legislation. 

• 

Stakeholder consultations 

This proposal is based on a request made by Germany and concerns only this Member State. 
Therefore, no stakeholder consultation has been conducted. 

• 

Collection and use of expertise 

There was no need for external expertise. 

• 

Impact assessment 

This proposal concerns an authorisation for an individual Member State upon its own request 
and does not require an impact assessment.  

However,  as  mentioned  above,  the  information  provided  by  Germany  suggests  that  the 
measure will have a limited impact on tax revenues, and the tax rate for shore-side electricity 
will  still  be  above  the  minimum  level  of  taxation  set  in  Directive  2003/96/EC.  Germany 
expects  the  measure  to  have  a  positive  impact  on  achieving  its  environmental  goals  and  in 
particular improving local air quality and reducing noise in port cities. 

More specifically, the use of shore-side electricity instead of on-board generators can result in 
lower  emissions  of  many  air  pollutants  –  such  as  nitrogen  and  sulphur  dioxides,  fine 
particulate  matter  and  heavy  metals  –  as  well  as  significant  reductions  in  noise  pollution  in 
some  cases  (as  confirmed  by  feedback  indicating  a  drop  in  the  number  of  complaints  from 
inner-city locations). Given that more stringent air quality limit values will apply from 2030 
onwards, shore-side  electricity can be  expected to become more important  as  a measure  for 
reducing emissions. 

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In their estimation of the tax expenditures from the measure, the German authorities expect a 
loss of EUR 1.3 million per year for the coming years. 

• 

Regulatory fitness and simplification 

The  measure  does  not  provide  for  a  simplification.  It  is  the  result  of  the  request  made  by 
Germany and concerns only this Member State. 

• 

Fundamental rights 

The measure has no bearing on fundamental rights. 

4. 

BUDGETARY IMPLICATIONS 

The  measure  does  not  impose  any  financial  or  administrative  burden  on  the  Union.  The 
proposal therefore has no impact on the budget of the Union. 

5. 

• 

OTHER ELEMENTS 

Implementation plans and monitoring, evaluation and reporting arrangements 

An  implementation  plan  is  not  necessary.  This  proposal  concerns  an  authorisation  for  a  tax 
reduction  for  an  individual  Member  State  upon  its  own  request.  It  is  provided  for  a  limited 
period  until  31  December  2029.  The  tax  rate  that  will  apply  will  be  equal  to  the  minimum 
level of taxation set by the Energy Taxation Directive. The measure can be evaluated in case 
of a request for a renewal after the validity period has expired. 

• 

Explanatory documents (for directives) 

The proposal does not require explanatory documents on the transposition. 

• 

Detailed explanation of the specific provisions of the proposal 

Article  1  stipulates  that  Germany  will  be  allowed  to  apply  a  reduced  rate  of  electricity 
taxation to electricity directly supplied to vessels, other than private pleasure craft, berthed in 
German  ports  (‘shore-side  electricity’).  The  tax  rate  must  not  be  less  than  EUR  0.50  per 
MWh, i.e. the minimum level of taxation for electricity for business use set by the Directive. 
It will not be possible to supply electricity at a reduced rate to private pleasure craft as defined 
in Article 14(1)(c), second subparagraph of Directive 2003/96/EC.  

Article 2 in its first paragraph stipulates that the authorisation requested is granted with effect 
from  1  January  2026,  in  continuity  with  the  current  Council  Implementing  Decision 
2020/1436/EU,  until  31  December  2029,  within  the  maximum  period  allowed  by  the 
Directive, as requested by Germany. Second paragraph specifies that in case of adoption by 
the Council on the basis of Article 113  or any other relevant provision of the Treaty  of any 
general  provisions  on  tax  advantages  for  shore-side  electricity,  which  become  applicable 
during  the  period  set  out  in  the  first  paragraph,  the  Decision  ceases  to  apply  when  those 
general provisions become applicable. 

EN 

9 

  EN 

 
2026/0121 (NLE) 

Proposal for a 

COUNCIL IMPLEMENTING DECISION 

authorising Germany to apply a reduced rate of taxation to electricity directly provided 
to vessels at berth in a port, in accordance with Article 19 of Directive 2003/96/EC 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty on the Functioning of the European Union,  

Having  regard  to  Council  Directive  2003/96/EC  of  27  October  2003  restructuring  the 
Community framework for the taxation of energy products and electricity22, and in particular 
Article 19(1), first paragraph, thereof, 

Having regard to the proposal from the European Commission, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

22 
23 

By  Council  Implementing  Decision  (EU)  2020/143623,  Germany  was  authorised  to 
apply  a reduced  rate of taxation to  electricity directly  supplied to  vessels, other than 
private  pleasure  craft,  at  berth  in  a  port  (‘shore-side  electricity’)  until  31  December 
2025, in accordance with Article 19 of Directive 2003/96/EC. 

By  letter  of  26  August  2025,  Germany  sought  authorisation  to  continue  to  apply  a 
reduced  rate  of  taxation  to  shore-side  electricity  pursuant  to  Article  19  of  Directive 
2003/96/EC.  On  23  January  2026  the  German  authorities  sent  a  letter  providing 
additional information related to the request. 

Through  the  reduced  tax  rate  that  it  intends  to  apply,  Germany  aims  to  continue 
promoting the use of shore-side electricity. The use of such electricity is considered to 
be an environmentally less harmful way of satisfying the electricity needs of vessels at 
berth in a port than the burning of bunker fuels by those vessels. 

Insofar  as  the  use  of  shore-side  electricity  avoids  emissions  of  air  pollutants 
originating from the burning of bunker fuels by vessels at berth in a port, it improves 
local  air  quality  in  port  areas.  Under  the  specific  conditions  of  the  electricity 
generation structure in Germany, the use of shore-side electricity instead of electricity 
generated by burning bunker fuels is furthermore expected to reduce CO2 emissions, 
other air pollutants and noise. The continued application of the reduced rate of taxation 
to shore-side electricity is therefore expected to contribute to the environmental, health 
and climate policy objectives of the Union. 

19 

OJ L 283, 31.10.2003, p. 51, ELI: http://data.europa.eu/eli/dir/2003/96/oj 
Council  Implementing  Decision  (EU)  2020/1436  of  7  October  2020  authorising  Germany  to  apply  a 
reduced rate of taxation to electricity directly provided to vessels at berth in a port, in accordance with 
(OJ 
Article 
ELI: 
2003/96/EC 
of  Directive 
http://data.europa.eu/eli/dec_impl/2020/1436/oj) 
to  Council 
in 
Implementing Decision (EU) 2020/1436 of 12 October 2020 authorising Germany to apply a reduced 
rate of taxation to electricity directly provided to vessels at berth in a port, in accordance with Article 19 
ELI: 
of 
http://data.europa.eu/eli/dec_impl/2020/1436/corrigendum/2020-10-16/oj ) 

p. 
to  Corrigendum 

331, 
connection 

2003/96/EC 

12.10.2020, 

16.10.2020 

Directive 

342, 

(OJ 

30, 

31 

p. 

L 

L 

EN 

10 

  EN 

 
 
(5) 

(6) 

(7) 

Allowing  Germany  to  apply  a  reduced  rate  of  taxation  to  shore-side  electricity  does 
not go beyond what is necessary to increase the use of such electricity, since on-board 
generation  of  electricity  will  remain  the  more  competitive  alternative  in  most  cases. 
For  the  same  reason,  and  because  of  the  current  relatively  low  degree  of  market 
penetration of the relevant technology, the application of that reduced rate of taxation 
is  unlikely  to  lead  to  significant  distortions  in  competition  during  its  period  of 
application  and  will  therefore  not  negatively  affect  the  proper  functioning  of  the 
internal market.  

In accordance with Article 19(2) of Directive 2003/96/EC, each authorisation granted 
under Article 19(1) of that Directive is to be strictly limited in time. In order to ensure 
that  the  authorisation  period  is  sufficiently  long  so  as  not  to  discourage  relevant 
economic operators from making the necessary investments, it is appropriate to grant 
the authorisation requested for a four-year period. However, that authorisation should 
cease  to  apply  upon  the  application  of  any  general  provisions  on  tax  advantages  for 
shore-side electricity that would be adopted by the Council under Article 113 or any 
other  relevant  provision  of  the  Treaty,  should  such  provisions  become  applicable 
during the period of authorisation. 

In order to provide legal certainty to port and ship operators, and to avoid a potential 
increase  in  the  administrative  burden  for  distributors  and  redistributors  of  electricity 
resulting from changes to the tax rate levied on shore-side electricity, Germany should 
be  enabled  to  continue  to  apply  the  reduced  rate  of  taxation  to  shore-side  electricity 
without  interruption.  The  authorisation  requested  should  therefore  be  granted  with 
effect  from  1  January  2026,  in  order  to  follow  seamlessly  on  from  the  prior 
arrangements under Implementing Decision (EU) 2020/1436. 

(8) 

This  Decision  is  without  prejudice  to  the  application  of  Union  rules  regarding  State 
aid, 

HAS ADOPTED THIS DECISION:  

Article 1 

Germany  is  authorised  to  apply  a  reduced  rate  of  taxation  to  electricity  directly  supplied  to 
vessels, other than private pleasure craft, at berth in a port (‘shore-side electricity’), provided 
that  the  minimum  levels  of  taxation  referred  to  in  Article  10  of  Directive  2003/96/EC  are 
respected. 

This Decision shall apply from 1 January 2026 until 31 December 2029. 

Article 2 

However,  should  the  Council,  acting  on  the  basis  of  Article  113  or  any  other  relevant 
provision  of  the  Treaty  on  the  Functioning  of  the  European  Union,  adopt  any  general 
provisions  on  tax  advantages  for  shore-side  electricity,  which  become  applicable  during  the 
period  set  out  in  the  first  paragraph  of  this  Article,  this  Decision  shall  cease  to  apply  when 
those general provisions become applicable. 

EN 

11 

  EN 

 
This Decision is addressed to the Federal Republic of Germany. 

Done at Brussels, 

Article 3 

For the Council 
The President 

EN 

12 

  EN