> while electricity is also normally expensive, if you have electrical heating you're excempt from paying taxes on electricity usage above 4000 kWh per year

:) So it can be done with state subsidies, but worldwide even the one time bonuses for EVs are being canceled. States aren't likely to give up on even more revenue.

It’s not a subsidy, but a hold back from taxation. It’s usually in these country’s national security interests, let alone environmental interest, to push away from gas and oil given that they are often imported from hostile nations. America doesn’t really have that same problem, but Denmark and China do.

> It’s not a subsidy, but a hold back from taxation.

I like pedantry as much as the next person but that feels like a pointless distinction here.

If you think of it from the American perspective maybe, but imagine there was a 100% tax on cars, ok, that’s definitely not just a revenue thing anymore but trying to restrict people from driving. Now make that 100% tax less for EVs, then you have more people driving around in EVs.

In America, cars and gasoline are ridiculously cheap, so the EV tax break comes from real tax revenue, rather than a tax designed to actually limit consumption. But in Norway and Denmark, where cars are taxed harshly, I doubt they say much revenue drop at all as EVs probably spurred people to buy cars who otherwise wouldn’t have.

>I like pedantry as much as the next person but that feels like a pointless distinction here.

One is a payment you receive, the other is a bill you don't receive. They can be similar to your bottom line, but they are definitely not the same thing especially if there is a middle area where you wouldn't have paid the extra tax anyway, so you aren't even getting an advantage.

I don't think the OP is talking about an income like tax but a tax built into every kWh you pay for...

It's still the same concept though. One is a bill you pay and other is free money you receive. There are all sorts of reasons for the bill you pay to be different based upon different criteria, that's not the same as getting free money directly.

Excise taxes on end-user energy don't tend to have exceptions...

They do in Denmark (and probably more of the EU).

If you have electric heating (resistive or heat pump, doesn't matter), you will pay €0.01 / kWh in energy tax for all electricity consumed above 4000 kWh per year.

The 4000 kWh is the "expected average" consumption for a household for a year, and of those you pay the full energy tax, which is currently DKK 0.9 / kWh including 25% VAT.

If you drive an EV, you can also get a refund for the energy tax of the electricity used to charge your car, provided you have an approved EV charger with a supported energy meter, which is most of the common chargers. You will need to enter into an agreement with a "charging company" to apply for the refund, so no individual refunds.

This of course doesn't apply if you have reduced energy tax, as you're not paying energy tax in the first place (except the first 4000 kWh)

Why €0.01 ? It's the minimum energy tax allowed by the EU, and i assume it's to avoid some spreadsheet breaking somewhere if it was 0.

Except when they do. They make all sorts of deals with commercial users and such, it's not a big deal to make exceptions for certain levels of home usage.

> It’s not a subsidy, but a hold back from taxation.

These are exactly the same thing in the end unless a subsidies were to exceed tax revenue.

From government tax accounting perspective tax breaks are same thing as subsidies, lost revenue.

What if exemption wasn't in place?

My average price during 2024, with taxes was DKK 0.88/kWh ($0.$12). This number is biased as it includes EV charging typically done at night where electricity prices are low, and the EV takes up about 40% of our electricity consumption. It is however the average price reported by my smart meter for 2024.

The average price for electricity with taxes was DKK 2.77 / kWh [1] ($0.39)

I spent 4600 kWh on the heat pump during 2024, so DKK 4048 ($562) without taxes and DKK 10.764 ($1497) with taxes.

I haven't checked my COP for 2024, but it's usually around 4, meaning I've gotten 18400 kWh worth of heat from those 4600 kWh electricity.

Natural gas has around 10 kWh worth of heat per m3, and assuming an optimistic efficiency of 90% for the gas burner, that is equivalent to 2044 m3 natural gas.

The average price of natural gas in the first 6 months of 2024 in Denmark was DKK 11.09 [1], so DKK 22.667,96 ($3.152,63) would be the price to produce the same heat with natural gas.

So even if paying the full price for electricity, I would still only be spending less than 50% for heating with the heat pump compared to natural gas.

[1]: https://www.dst.dk/en/Statistik/emner/miljoe-og-energi/energ...