Faroe Islands propose tax break for small solar power sellers

The Faroe Islands government wants to exempt income from small solar power installations from tax, KVF reports. A proposed amendment to the tax law would apply to private installations producing no more than 11 kilowatts and connected to an electricity meter.

The Finance Ministry says the exemption, combined with the price utility SEV pays for solar power, is intended to encourage private investment in energy production. It estimates the tax break could eventually be worth up to seven million kroner a year.

The energy policy adopted in 2022 set a target of 60 megawatts of solar power, including 20 megawatts from private rooftops. Reaching the target is expected to save SEV 3,000 tonnes of oil and cut annual carbon dioxide emissions by 10,000 tonnes.

So far, solar capacity has reached 1.5 megawatts, or 2.5 per cent of the 60-megawatt target.