Seven government sustainability measures to look out for

Energy suppliers divide the price of energy into three parts:

• the market price
• energy tax
• VAT

Energy tax is a source of revenue for the government and can be an incentive to save energy. But energy tax (including levies) can make up more than 50% of the total energy bill. There are different tax bands for both natural gas and electricity, depending on usage. Households typically come under bands 1 and 2. In an effort to move away from natural gas, energy tax was increased on natural gas (in the first few bands) and reduced on electricity in 2024. There were plans to significantly increase energy tax on natural gas for the coming years, but the government has since decided against this and to even reduce energy tax on natural gas in 2025:

• The price will be reduced by 2.8 cents per m3 for bands 1 and 2. This reduction will be increased further to 4.8 cents per m3 in 2030.
• On average, a household using gas will pay around €30 less. The rate for electricity will also be reduced until 2034 inclusive.
• The reduction in energy tax does not provide an incentive to use less energy, but affordability does remain a concern.

Many people have seen their energy bills rise over the past year, and 2025 looks to be another year of uncertainty when it comes to energy prices. But you can reduce your energy costs by making your home more energy-efficient. Sustainability measures will continue to be encouraged in 2025 through grants at national, provincial and municipal level. You can sometimes get a fair amount back on the energy-efficiency improvements you make to your home, thanks to a government scheme. If you’d like to know what energy-efficiency measures you can take yourself and how you can save more on your energy costs, do the Energy Saving Check.

If you have solar panels, you can feed the energy you generate into the grid during the day. But in the evening and at night, you often use more energy than you generate and have to pay for it. To get around this, you can take advantage of the net metering scheme, which allows you to offset the amount you generate against the amount you use from the grid, up to a certain maximum. If you feed more power in than you use, you will receive a lower fee from the energy supplier on the excess amount. In 2025, you can still use the net metering scheme in full for the electricity you feed into and take out of the grid. This scheme does mean a loss for energy suppliers and the government, which is why many energy suppliers charge an extra fee when you feed electricity back into the grid. The net metering scheme costs the government more than €600 million per year.

The new cabinet therefore plans to completely abolish the current scheme in one go as of 1 January 2027 ‒ a major setback for solar panel owners. A new bill to fully abolish the net metering system has yet to be adopted by both chambers of parliament. In fact, there is currently no majority in the Senate to support abolishing the system, so it’s uncertain whether this proposal will go ahead in 2027. In 2025 and 2026 at least, you can still make full use of the net metering scheme.

Investing in solar energy has been particularly attractive since early 2023, as no VAT has been charged on supplying and installing solar panels. This temporary measure will continue to apply in 2025 in an effort to encourage investment in this sustainable form of energy. It also reduces the administrative burden on solar panel owners and the tax authorities alike.

As long as you remain below the registration threshold (i.e. your feed-in profit is less than €2,200 in 2025), there is also no VAT on electricity you feed into the grid. This typically applies to most individuals with fewer than approximately 20 solar panels. With less administration required, no VAT on purchasing solar panels (in most cases) and full eligibility for the net metering scheme, investing in solar panels looks to be a particularly attractive option in 2025. But even if the net metering scheme is abolished as planned, solar panels remain a worthy investment.

The government wants electric vehicle drivers to make fairer contributions towards tax revenues in the longer term, so from 2025 onwards, there will be no grants available for buying a new or used electric car. That said, the government does want to encourage EV sales with a 25% discount on vehicle tax from 1 January 2025 until the end of 2029. From 2030, this discount will no longer apply.

The government is attempting to encourage investment in green projects. If you save or invest in government-certified green funds, you’ll be eligible for a tax exemption of up to €60,000 (total amount applicable to you and your tax partner together in 2025) on those green savings and investments. This exemption reduces your assets in box 3 of your tax return and, in turn, the tax you have to pay. In addition, you will receive a tax reduction of 0.7% (in 2025) on the tax payable (up to the amount exempted). However, you must have the green savings or investments on the reference date of 1 January 2025, otherwise you will no longer be able to use the tax exemption in 2025.

Since early 2023, the way assets are taxed in box 3 has changed considerably. The tax on bank balances and savings is now much lower than on other assets. For the new taxation method in box 3, green savings are classed as savings and green investments are classed as other assets. You can first deduct your green investments, followed by your green savings, from the tax-free allowance.

There’s another advantage when you save the green way. With a Green Savings Deposit, you get a higher interest rate than on a regular savings account.

All in all, the maximum tax benefit for green savings or investments can be over 2.5% ‒ not forgetting the higher interest rate on your savings and the return on your investment. A win-win for you and the environment when you save green or invest green!

In May 2023, former minister Hugo de Jonge announced his ambitious plan to replace heating installations from 2026 onwards. He championed the idea of making hybrid or electric heat pumps compulsory as the logical solution. However, the new government sees that as a financial burden that households could currently do without and is therefore scrapping the obligation to purchase a heat pump in 2026. The idea is to allow more freedom of choice when it comes to heating installations, despite the fact that further electrification of the built environment and scaling up the use of heat pumps in existing residential and non-residential buildings alike are crucial to the energy transition.

A series of measures to improve home sustainability are being scaled back. However, there are still several attractive financial schemes available to make your home more energy-efficient. The government will continue to play a crucial role in this in 2025, such as by offering grants, tax relief and even a lower tax rate when you choose a green way to save.

So investing in sustainability can deliver financial benefits for you and often makes for a more comfortable home. Plus, you’re doing your bit for the environment at the same time. What’s not to gain?

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