Hybrid heat pumps: Coénove asks the government to withdraw a proposed VAT increase that runs counter to the energy transition

Such a measure, contrary to current European and French legislation, would amount to increasing the cost of these high-performance facilities, which are nevertheless recognized as essential levers for flexibility and decarbonization of the existing housing stock.

According to Jean-Charles Colas-Roy, president of Coénove: "While France has committed to a plan for one million heat pumps, it would be inconsistent to penalize a complementary, efficient solution supported by a leading Franco-European industry."

An interpretation contrary to the European directive and French law

Coénove points out that the European Directive on the Energy Performance of Buildings (EPBD), adopted in April 2024, explicitly authorises financial incentives for hybrid systems, recognized as solutions compatible with decarbonization objectives.

Equating hybrid heat pumps with "stand-alone fossil fuel boilers" is therefore an erroneous interpretation of the European text, contrary to its spirit.

From a legal standpoint, the association emphasizes the clear illegality of the approach:

• No provision of the 2025 Finance Law has modified the VAT regime applicable to hybrid equipment.
• The tax authorities cannot extend the scope of exclusions established by law through official guidelines. The interpretation proposed by the BOFIP (French Official Tax Bulletin) appears illegal, as the eligibility of hybrid heat pumps is explicitly stated in the Tax Code.
• The retroactive nature of the measure, to March 1, 2025, would produce an effect inconsistent with the principle of legal certainty, by modifying the tax conditions applicable to operations already carried out and, moreover, would be impossible to implement by professional installers.

An industrial, energy and European contradiction

The BOFIP draft justifies this exclusion on the grounds that hybrid heat pumps would partially use fossil fuel energy.

For Coénove, this approach ignores the technological and energy realities of these systems, which combine an electric heat pump with a gas backup system that is 100% compatible with green gases, and allow for:

• To immediately and significantly reduce consumption and CO2 emissions, while guaranteeing user comfort at a competitive price in terms of investment (lower power required),
• Strengthening the flexibility and security of the energy system during periods of high demand, as is the case in winter in France, in the building sector,
• To preserve the industrial competitiveness of a sector of Franco-European manufacturers, experts in hot water loop heating, bio-combustion and hybrid solutions,
• To propose a solution adapted to the gradual renovation of existing housing and to the purchasing power of households.

For a pragmatic and balanced energy transition

True to its mission, Coénove advocates a carbon neutrality trajectory based on reducing consumption and the complementarity of energy sources:

• Energy sobriety and efficiency,
• Gradual greening of gas to reach 100% green gas by 2050.
• Generalization of hybrid solutions and very high energy performance.

For Jean-Charles Colas-Roy: “The success of the energy transition will not come solely from the excessive electrification of energy uses. The solution lies in the intelligent combination of energy sources. Hybridizing equipment allows us to facilitate the implementation of demand management and flexibility policies while promoting the alliance of decarbonized electrons and greener gas molecules. Encouraging hybrid heat pumps means supporting our French and European manufacturers and fostering our entire installation, servicing, and maintenance sector, which demands fiscal and regulatory stability while maintaining a diverse range of high-performance equipment for its customers.”

Coénove is requesting a withdrawal of this proposed increase in VAT on hybrid heat pumps and a meeting with the Prime Minister's office to present the results of its Artelys study "Perspectives 2030", which supports the relevance of a diversified energy mix and the choice without regret of hybrid solutions and support for the massive development of green gas.

Illustrative image of the article via Depositphotos.com.