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Climate Policy Series

Energy Tax (Hidden in Bills)

Understand how energy taxes drive renewable adoption and environmental goals while being completely hidden in your utility bills

Updated for 2025
6 min read

How Energy Tax Works

Electricity Tax

~35% of electricity bill

Tax on electricity consumption to encourage energy efficiency

Policy Purpose:

Reduce consumption, fund renewable energy subsidies

Gas Tax

~51% of gas bill (highest in EU)

Tax on natural gas to discourage fossil fuel use

Policy Purpose:

Accelerate transition to heat pumps and renewable heating

Netherlands vs. EU

The Netherlands has the highest energy taxes in Europe, reflecting its ambitious climate goals and commitment to becoming carbon neutral by 2050.

Netherlands
#1 in EU

Aggressive climate policy

Gas Tax %
51%
Electricity Tax %
35%

Denmark
#2 in EU

Carbon tax pioneer

Gas Tax %
45%
Electricity Tax %
40%

Germany
#3 in EU

Energiewende program

Gas Tax %
38%
Electricity Tax %
32%

EU Average

Varied approaches

Gas Tax %
28%
Electricity Tax %
25%

Climate Policy Goals

Carbon Neutrality by 2050

Energy taxes make renewable energy relatively cheaper than fossil fuels

Progress85%

70% CO2 Reduction by 2030

High energy taxes encourage immediate behavior change

Progress65%

Renewable Energy Leader

Tax revenue funds solar, wind, and heat pump subsidies

Progress78%

Completely Hidden from View

You never see energy taxes separately on your bill - they're built into the per-kWh rate your energy company charges. This makes energy taxation politically easier but less transparent.

Example: €100 Gas Bill Breakdown

Actual gas cost€49
Energy tax (hidden)€51
Total on bill€100

Calculate Your Energy Tax Burden

See exactly how much energy tax you pay annually and how it compares to your total tax burden.