WEITNAUER RECHTSANWÄLTE: Law and taxes in the construction and operation of a charging infrastructure10/30/2020

Law and taxes in the construction and operation of a charging infrastructure

Electromobility: The legal and fiscal issues involved in setting up charging infrastructure can be stumbling blocks for ambitious projects. Among other things, one has to consider the charging pole regulation, the energy industry law and the renewable energy law, explain attorney Dirk Voges of the law firm Weitnauer and his colleague Stefan Zagel, tax consultant in Ebner Stolz tax lawyers and tax consultants.

The energy transition and the inner-city emission burdens caused by a strongly increasing traffic volume are two of the dominant topics in Germany. When it comes to the question of how local immissions can be avoided, one focus is on emission-free individual transport using electromobility. Politicians at the federal and state level are trying to increase the acceptance of electromobility among the population through support programs such as the eco-rebate for the purchase of electric cars and the support directive for charging infrastructure, as well as legislative projects such as the law on the development of charging and wiring infrastructure for electric cars in buildings ("GEIT"). 

The GEIT stipulates that in new residential buildings or in the case of a major renovation of a residential building (i.e. renovation of a building in which more than 25 percent of the surface of the building shell is subject to renovation) with more than ten parking spaces, all parking spaces must in future be equipped with the line infrastructure for electromobility; this means that all line routing to accommodate electrical and data technology lines in the building parking space must be installed via the metering point of a connection user up to the protective elements. In new non-residential buildings or in case of a major renovation of a non-residential building with more than ten parking spaces, every fifth parking space must be equipped with the line infrastructure and at least one charging point must be installed. Until January 1, 2025, every non-residential building with more than twenty parking spaces must also be equipped with at least one charging point.

At the same time, the expansion of renewable energies is to be promoted through the obligation to install photovoltaic systems. For example, the Hamburg Senate passed a climate plan and a climate protection law as early as December 2019, which, among other things, also provides for an obligation to install solar systems in new buildings from January 1, 2023 and in roof renovations from January 1, 2025. This obligation is to apply to both residential and non-residential buildings. The state parliament in Stuttgart followed suit in May of this year and decided on an obligation for the state of Baden-Württemberg to install photovoltaic systems for new buildings that are not used for residential purposes from January 1, 2022. Furthermore, all new parking facilities with more than 75 parking spaces for which a building application is submitted after January 1, 2022 must be roofed with a photovoltaic system. In June, the Parliament of Bremen initiated a similar legislative project.ht.

And there has been no idleness at the federal level either. The building renovation law, which was passed by the German Bundesrat on July 3, 2020, includes the obligation to use renewable energies for new buildings of residential properties and the mandatory consultation of an energy consultant before any major renovation work. For buildings used by the public sector (residential and non-residential property) there is a photovoltaic obligation for new buildings and, in the case of major renovations, the obligation to check the installation of a corresponding system.

The expansion of decentralized energy production through the obligation to install photovoltaic systems on roofs also puts the focus on the consumption of this energy on site, in order not to endanger the stability of the distribution networks and the security of supply. The legal measures for the expansion of the charging infrastructure for electric cars should also be seen against this background.

Regardless of this political will, the legal framework for the development and operation of a charging infrastructure for electric cars is peppered with legal pitfalls, some of which have not yet been resolved by legislation or case law. 
Which different laws have to be taken into account when setting up and operating the charging infrastructure will be examined in more detail in the following, whereby the main focus will be on the construction and operation of the charging infrastructure in buildings. The background to this is that the German government assumes in the charging infrastructure master plan adopted in November 2019 that between 60 and 80 percent of charging processes for electric cars will take place at home or at the employer's premises and only 15 to 40 percent in public area.

A. Legal Context 
The legal framework for the establishment and operation of a charging infrastructure is formed by the following laws: Charging Pole Regulation (LSV), Energy Industry Act (EnWG), Renewable Energies Act (EEG), Condominium Ownership Act (WEG), Building Code (BauGB), State Building Ordinances (LBO), Measuring Point Operation Act (MsbG), General Data Protection Regulation (DSGVO), Antitrust Law (GWG, AEUV), Measuring and Calibration Act (MessEG), Measuring and Calibration Ordinance (MessEV), Price Indication Ordinance (PAngV). 
The following is a summary of the most important pieces of legislation with their relevant provisions for the construction and operation of the charging infrastructure.

I. Charging Pole Regulation (LSV)
The LSV is authoritative and applies to the establishment and operation of publicly accessible charging points. According to the idea of the legislator, reproduced in the definition of the term in § 2 No. 9 LSV, a charging point is publicly accessible if it is located in public road space or on private ground, if the parking lot belonging to the charging point can actually be driven over by an undefined group of persons or a group of persons that can only be determined according to general characteristics. Therefore, the question of applicability is determined exclusively by the possibility of access to the parking lot where the charging point is located. For example, the fact that the user of a parking space must first draw a parking ticket before he can use the parking space with the wallboxes in the underground car park does not per se exclude public accessibility. The same applies to the ten parking spaces with wallboxes in the underground car park of an office complex, which has several hundred spaces and can be used by the employees of the companies located there and their customers and visitors. 

The technical requirements that a charging point must meet if the LSV applies are defined in §§ 3-6 LSV; charging points with a charging capacity of no more than 3.7 kilowatts are excluded from this. The technical requirements for normal charging infrastructure (up to 22 kilowatts of charging capacity) and fast charging infrastructure (more than 22 kilowatts of charging capacity) are different, but in both cases it should be noted that in the case of selective charging, it must offer the user two options (out of a total of four granted by law) for billing. Further technical requirements may result from the federal funding guideline "Charging infrastructure for electric vehicles in Germany" of March 2017 and the corresponding funding regulations at state level.

II. Measurement and Calibration Act (MessEG)
According to § 1 para. 1 No. 6 MessEV, measuring instruments have to meet the legal calibration requirements according to the MessEG, if they are to determine measured quantities when supplying electricity. If the legal calibration requirements are not met despite the applicability of the MessEG, the operator of the charging point and the user of the measurement data are threatened with considerable sanctions. 

Decisive is thus the question, which data collected during the operation of the charging point for the settlement of the purchased electricity is a measured variable in the sense of § 1 paragraph 1 No. 6 MessEV?

If billing is based on the kilowatt hour charged during the charging process, this is a measured quantity in the above sense and the measuring device must be calibrated in accordance with the MessEG.  

If, on the other hand, billing is based on the charging time, it is disputed whether this is a measured variable in the above sense. While this is to a large extent rejected in the legal literature, the state calibration authorities take the opposite view and demand calibration of the measuring instruments which record the charging time. 

The above applies accordingly to the billing of combination rates (charging time + kilowatt hours), whereas billing according to session fee and flat rate is not subject to the calibration obligation.

It should be noted that the calibration obligation applies not only to the respective measuring instrument, but also to the downstream back-end system in which the measured values are displayed, stored or further processed.

III. Energy Industry Act (EnWG)
§ 3 No. 25 EnWG stipulates that the final consumer within the meaning of EnWG is the operator of the charging point and not the user charging at the charging point. As a result, the operator is not an energy supplier according to § 3 No. 18 EnWG and in relation to the user of the charging point he does not have to comply with the obligations of an energy supplier towards his customer according to EnWG. On the other hand, according to § 17 EnWG, there is a claim for connection of the charging point to the distribution network. And after § 20 EnWG the operator can select its current supplier freely. 

IV. Renewable Energy Sources Act (EEG)
In contrast to the EnWG, the end consumer in the sense of the EEG is the user of the charging point, § 3 No. 33 EEG, the electricity charged by him is therefore subject to EEG apportionment. To determine the amount of the EEG levy, it is therefore decisive who is the operator of the electricity generation plant and who is the end consumer.

If the operator of the photovoltaic system on the roof is also the user of the charging point into which solar electricity is fed, a no or only a reduced EEG levy is payable in accordance with the provisions of §§ 61a ff EEG. Small consumptions by third parties at the charging point are attributed according to § 62a EEG or are to be delimited metrologically, § 62b EEG.

If the employer is the operator of the photovoltaic system on the roof as well as of the charging point and if his employees can use the charging point for payment or free of charge, then the full EEG levy must be paid on this. The same applies to the lessee who uses a charging point operated by the lessor.

The reporting obligations according to §§ 74, 74a EEG must be observed by the operator of the charging point.

B. Taxes
As mentioned, the German government assumes that a considerable proportion of users of electric cars will charge them during working hours at their employer. This would not remain without tax consequences:

If the employee is allowed to charge his own electric car at a stationary operational facility of the employer or an associated company or if the employer leaves an operational charging point for private use to the employee, the monetary advantage from this is tax-free (§ 3 No. 46 EStG). This benefit is granted since 2017 and ends on December 31, 2030. Charging electric bicycles is also exempt from wage tax.

The prerequisite is that the recharge is granted in addition to the salary that is owed anyway. In the opinion of the tax authorities, this is the case if the employee is entitled under labor law to the employer's earmarked benefits, but not if earmarked employer benefits are granted by offsetting them against the wage owed under labor law or by converting them. In other words: if the free charging is an additional service of the employer, then it is not a benefit in money's worth; if, on the other hand, the employee waives part of his agreed remuneration in order to charge free of charge in return, then it is a benefit in money's worth.  

In the opinion of the Federal Ministry of Finance, the employer's stationary operational facility for recharging electric cars is the entire charging infrastructure, including accessories, and the services provided in this connection. This includes the construction, installation and commissioning of the charging device, its maintenance and operation as well as the preparatory work necessary for commissioning, such as the laying of a power cable. 

In the opinion of the tax authorities, this does not favour recharging at a third party or at a charging device operated by a third party, nor recharging at the employee's home. The Federal Ministry of Finance derives its opinion from the definition of the term "operator" in § 2 No. 12 LSV, according to which the operator of the charging point is the one who, taking into account the legal, economic and factual circumstances, exerts a determining influence on the operation of the charging point.

According to this view, charging a private electric car of the employee at charging devices (wallbox or charging station), which are only provided to the employer by the landlord/owner of the office premises for use, is therefore not covered by the tax concession. So-called agreements for charge-sharing are therefore excluded, as well as agreements with petrol station or charging station operators.

If the employer provides the employee with a charging device for private use provided by a third party, i.e. if he enables the employee to charge his private electric car there and does not charge the employee the remuneration to be paid to the operator of the charging point, this constitutes a pecuniary advantage subject to wage tax. The employer must record this pecuniary advantage in the employee's monthly payroll and pay the wage tax due on it to the tax office in accordance with the individual wage tax characteristics. 

If the employer provides his employee with an electric car as a company car for private use as well, this non-cash benefit is to be recorded for wage tax purposes on a monthly basis at the flat-rate percentage based on the gross list price of the car, which has already been reduced from 1 percent to 0.5 percent since the Annual Tax Act 2018, i.e. the employee is ultimately taxed at his personal income tax rate. The halving also applies to the so-called logbook method and is also to be used to determine the monetary advantage from the use of a company car for journeys between home and place of work/business or for journeys home as part of a double household. With the so-called "Jahressteuergesetz 2019" (Annual Tax Act 2019), the lump-sum tax assessment basis was even reduced to ¼ of the gross list price plus the costs of the special equipment including VAT, capped at 60,000 euros for purely electric cars without CO2 emissions purchased between January 1, 2020 and December 31, 2030.  

It is advantageous that the pecuniary advantage for the charging equipment provided by the employer or third parties at a reduced price or free of charge and the charging current for charging the electric company car within the framework of the application of the flat-rate method (1%, 0.5% or 0.25% method) or the so-called logbook method has already been compensated. 

On the other hand, tax exemption does not apply in particular to charging current which the employer supplies free of charge to (i) business friends of the employer and their employees or (ii) his customers. If this group of persons is granted the opportunity to charge up their electric cars, the expenses must be recorded separately and treated in accordance with the general regulations on the tax treatment of gifts/gift to business associates. If the expenses for recharging per recipient and fiscal year exceed EUR 35.00, these expenses are not deductible as operating expenses for the donor. On the other hand, the recipient may have to record these gifts as business income. The donor can, however, avoid this consequence for the customer/business partner by making a lump sum taxation for all these benefits (§ 37b German Income Tax Law (EstG).

Dirk Voges, Stefan Zagel