Several instruments and regulations are designed to help companies in their energy efficiency improvement processes and projects.
1. Direct subsidies in the field of projects for the rational use of energy
Aid for industrial companies
Industrial companies can benefit from a financial aid scheme (Law of 15 December 2017 on aid schemes for environmental protection) managed by the Ministry of the Economy in the following areas:
- investment aid for energy efficiency measures
- investment aid for high-efficiency cogeneration
- investment aid for the promotion of energy produced from renewable sources
- investment aid for efficient heating and cooling networks
- investment aid for energy infrastructure
- aid for environmental studies
It is necessary to start the process and submit the grant application file before the start of the works.
More information on the Luxembourg administration portal guichet.lu.
Subsidies for artisanal and commercial SMEs
These companies fall under the aid scheme of the General Directorate for Small and Medium-Sized Enterprises of the Ministry of the Economy. Eligible investments and intervention rates are set out by the Law of 30 June 2004 creating a general framework for aid schemes for small and medium-sized Enterprises. The following are targeted:
- investments in energy savings, renewable energies and combined electricity and heat production;
- expenses incurred by an SME in the event of its recourse to external advice with a view to achieving progress in the field of environmental protection and the rational use of natural resources.
It is necessary to start the process and submit the grant application file before the start of the energy saving works.
More information on the Luxembourg administration portal guichet.lu
2. Tax measures
Certain provisions of income tax legislation make it possible to improve the profitability of investment projects thanks to two incentives:
- a "special depreciation" of up to 80% of the value of certain tangible fixed assets, in particular tangible investments made in the context of the rational use of energy or intended to reduce environmental nuisances (Reference: amended law of 4 December 1967 on income tax, Art. 32 bis)
- an income tax credit is possible for eligible investments according to Art. 32 bis (reference: amended law of 4 December 1967 on income tax, Art. 152 bis)
In order to benefit from these measures, the reality and conformity of the fixed assets eligible for special depreciation must be justified by ministerial certificates.
It is therefore necessary to check the applicability of these measures with competent partners (the Luxembourg Inland Revenue, the Ministry responsible for your investment projects and your tax expert).
For more information and to obtain the necessary forms, please consult the Luxembourg Inland Revenue website.