The Government reduces VAT for pellets, briquettes and firewood to 5 percent until December 31, 2022

firewood, pellets

The Council of Ministers, at the request of the Ministry for the Ecological Transition and the Demographic Challenge, the Ministry of Finance and Public Administration, and the Ministry of Economic Affairs and Digital Transformation, has approved a Royal Decree-Law 17/2022, of September 20, with several measures in the energy field, such as the VAT reduction from 21% to 5% in supplies of natural gas, pellets, briquettes and firewood, with savings for consumers of some 210 million euros; the possibility that cogeneration temporarily abandon its regulated remuneration regime, so that the Iberian Mechanism is applied to it; or the creation of a new active demand response service that will increase the flexibility and security of the electricity system.

AVEBIOM, the Spanish Biomass Association, has repeatedly requested this reduction, the last time it was a letter sent to the Government of Spain last week, arguing the social, economic and environmental benefit that this measure entails for all Spaniards, whether or not they are direct consumers of biomass.  

The tax reduction enters into force on October 1, will be in force until December 31, 2022 and will apply to pellets, briquettes and firewood, ecological substitutes for natural gas from biomass and intended for heating systems, whose prices have increased considerably with the approach of winter. It will provide an estimated savings of 19,4 million to consumers.