Taxation of “Virtual Battery” in VAT and IEE: DGT Consultation Analysis on Energy Market Product

Consultation on the “virtual battery” product in the energy market for VAT and IEE
An association of energy marketers wants to commercialize a product called “virtual battery” to store excess energy from self-consumption installations
The product can be used to offset future energy consumption or obtain a refund from the marketer
Question about the taxation of the “virtual battery” product in VAT and the possibility of using excess energy as a discount on future bills for IEE
DGT response: The “virtual battery” product is subject to VAT and IEE, discounts on excess energy cannot reduce the IEE base, and local public domain fees should not consider these discounts
VAT: Energy delivery is subject to VAT, excess energy from self-consumption does not count towards VAT base, discounts must still have VAT applied
IEE: Energy supplied is subject to IEE, exemption applies to energy compensated in billing period, excess energy from “virtual battery” cannot be exempt
Local public domain fees: Calculated based on gross billing revenue, cannot be reduced by discounts or excess energy compensation

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.