Solar installations in taxable subsidiary
Solar installations in taxable subsidiaries
Question:
Is it possible to install solar panels in our taxable subsidiaries?
Answer:
In a ministerial response, the Danish Transport Authority has stated that a port, as part of port operations, cf. section 6a of the Ports Act, can legally install solar cell systems as an integral part of a port activity when the purpose of the electricity production is the port's own consumption.
It is also worth noting that the ministerial response states that section 9(6)(5) of the Ports Act (for autonomous ports) only allows for the resale of surplus production with regard to wave and wind energy plants.
The provision is identical for public limited company ports (section 10(4)(1)) and the implicit prohibition must therefore be assumed to also apply to public limited company ports.
It is therefore our assessment that to the extent that solar cells are established for the port's own consumption, these can be placed in a subsidiary. This is also due to possible considerations for tax exemption versus the activity to be carried out.
Finally, it should be noted that the Electricity Supply Act - depending on the circumstances - may lay down requirements for how the plant must be formally organized, depending on e.g. the size of the plant and which settlement principles are applied for (net settlement etc.).
