The Council of the European Union has adopted an implementing decision authorising Belgium to apply a reduced rate of taxation to electricity directly supplied to vessels berthed in ports, excluding private pleasure craft, for a six-year period from 1 January 2027 to 31 December 2032. The decision, published on 7 July 2026 and set for formal adoption on 8 July 2026, requires that the reduced rate remains at or above the minimum EU tax levels set by Directive 2003/96/EC. The measure is intended to encourage the use of shore-side electricity as a cleaner alternative to burning bunker fuels while ships are at berth, thereby improving local air quality in port cities and reducing CO2, other air pollutants, and noise emissions.
Belgium submitted its request for the authorisation on 8 January 2026, arguing that the tax reduction would help offset the higher cost of shore-side electricity compared to bunker fuels, making the environmentally preferable option more economically viable. The Council's decision notes that Belgium's electricity generation mix has a relatively low carbon intensity, which further supports the environmental benefits of the measure. The authorisation is limited to six years to provide investment certainty for port infrastructure and ship operators, but it will cease earlier if the Council adopts a revised general tax system for energy products under Article 113 of the Treaty on the Functioning of the European Union that is incompatible with this decision. The decision takes effect on the date of notification and is addressed solely to Belgium.
The decision impacts several stakeholders. Belgian port operators and shipping companies will benefit from lower operational costs when using shore-side electricity, potentially accelerating the adoption of onshore power supply systems. Belgian electricity providers may see increased demand from ports, though the reduced tax rate could lower their revenue per unit sold. Environmental groups and local communities in port cities stand to gain from improved air quality and reduced noise pollution. However, the temporary nature of the authorisation (six years) and the possibility of early termination due to EU-wide tax reform create regulatory uncertainty for long-term investments in shore-side power infrastructure. The decision does not affect other EU member states, which must seek their own derogations under Article 19 of the Energy Taxation Directive.