Netherland: Netherland Energy Profile

Energy sources

Natural gas consumption was approximately 49.4 bcm in 2010, according to Eurostat data. In 2010, the power generation (118.4 TWh) mix in the Netherlands was as well dominated by gas-fired power generation (with a share of 65.5%) and by solid fuels (19.1%); RES represented 9.5% and other sources such as nuclear power (3.4%) were less significant.

Milieukwaliteit Elektriciteitsproductie subsidieBesluit Stimulering Duurzame Energieproductie

In September 2012 the Netherlands elected a new government. Its work programme aims to increase the share of renewables in energy consumption to 16% by 2020, where the target set for the Netherlands by the EU is 14%, and the previous government was aiming at 14.5%.

Reliance

Since October 2009, the Netherlands is a net exporter of electricity, because in the last quarter of 2009 additional electricity was exported than imported to and from the surrounding nations. This was triggered by lower electricity prices in the Netherlands and large-scale maintenance projects in neighbouring nations.

Extend network

For a long time the Netherlands had only two interconnections with Belgium and three with Germany. However, TenneT has expanded this capacity to presently include additional interconnections with the United Kingdom (via the 1,000 MW BritNed cable) and with Norway (via the 700 MW NorNed cable). Interconnection with Norway allows for better capacity utilisation because of the noncoincident peak request periods of the two nations. Specifically, electricity consumption in Norway is relatively high at night time and so the Netherlands typically exports electricity to Norway during the night as it is cheaper and as well allows Norway to save the water in its reservoirs for use during the day. In turn, Norway exports electricity to the Netherlands during the daytime peak hours, at the same time as electricity is expensive. Importantly, Dutch market parties are able to import renewable hydropower from Norway via the NorNed cable.

Capacity concerns

Solar

Solar energy in the Netherlands represents only a small proportion of sustainable energy consumption (1%). On the other hand, the Netherlands has considerable knowhow, and is sixth in the world for solar energy patent applications and supply components of solar cells for the foreign markets. Significant cost savings can be completed by making solar cells thinner or by using different materials. An international distinguishing feature of Dutch solar thermal products is the drainback technology that is applied, which has benefits of maintenance-free use, and insensitivity to frost and overheating.



Onshore wind energy will continue to be one of the cheapest ways of generating renewable energy in the years ahead. This energy option has a potential of approximately 48 PJ by 2020 (2.3 % points), equivalent to the output of wind farms with a total capacity of around 6,000 MW.



Biogas

Biofuel niche development in the Netherlands seems to be characterized by a dual track approach. A small PVO/biodiesel niche emerged, but this is not very visible. In order to comply with the EU directive on biofuels, setting a target for a 2% biofuel mix in 2005 and a 5.75% mix in 2010, the Dutch government chose for obliging oil companies to distribute an all of biofuel equal to 2% of the total all of transport fuel distributed, starting in 2007. The plan is to increase the all of biofuel distribution successively. Moreover, there are hardly any ?lling stations providing pure, or high blend, biofuels in the Netherlands. The second research driven track focuses on advanced fuels, but this has not led to any large-scale experimentation. Advanced fuels remain a promise.

The industrial and transport sectors were both significant contributors to the Netherlands’ total final energy consumption, as of 2011 (21.6% and 19.5% respectively). In general, efficiency gains in the transport sector have been slow to date, mainly due to the trend in freight transport of moving from large trucks to light vehicles. Passenger car efficiency has improved and is accelerating, however. Household and industry improvements since the initial National Energy Efficiency Action Plan in 2009 have been above the European average, although transport improvements have been lower. Total final energy consumption has not changed significantly since 200, although the economic crisis of 2008 has had a notable impact on this, mostly in the industry and transport sectors. In general, the greatest potential for savings in the Dutch economy can be found in the built environment, with approximately 140 PJ of total energy savings available by 2020. The manufacturing and transport sectors as well have significant potential savings (75 PJ and 50 PJ, respectively).

Ownership

Electricity

The major producers of electricity in the Netherlands are Essent, Nuon, Eneco, E.ON, Electrabel (part of GDF Suez) and Delta.  In respect of the supply of electricity to end-users, Eneco, Essent and Nuon are the major players. Following the liberalisation of the Dutch energy market, these suppliers have lost market share to new entrants such as Electrabel, E.ON, DONG Energy, Oxxio, RWE and various smaller distribution companies. In 2009 Essent was acquired by RWE and Nuon was acquired by Vattenfall. In March 2011, Centrica sold Oxxio to Eneco.

Market concentration at retail level was high, as the three major companies covered 80.3% of the retail market at the end of 2010.



Even though the market is fully liberalised in the Netherlands, market concentration at the retail level remained high, as the three major companies covered 78.6% of the retail market at the end of 2010.

National Renewable Energy Action Plan (NREAP)

The NREAP for the Netherlands was submitted in July 2010. The target according to Annex I of Directive 2009/28/EC is 14% for the year 2020 and the projected NREAP share in that year is 14.5%. In October 2012 a new coalition agreement was presented, in which the ambition for the Netherlands was increased to 16% (in general) renewable energy by the year 2020. According to the projection, the majority significant contribution in the year 2020 is expected from wind power (32.4 TWh or 2787 ktoe, 38% of all renewable energy). The second significant contribution is expected from biomass (renewable heating and cooling) (1520 ktoe, 21% of all renewable energy). The third major contribution is from biomass (renewable electricity) (16.6 TWh or 1431 ktoe, 19% of all renewable energy). Wind power contributes with 11.2 GW (32.4 TWh) in the year 2020 (onshore wind 6.0 GW and 13.4 TWh, offshore wind 5.2 GW and 19.0 TWh). For photovoltaic power the 2020 contribution is projected to be 0.7 GW (0.6 TWh). For solar thermal the 2020 contribution is projected to be 23 ktoe. The two most significant biofuels are projected to contribute 552 ktoe (biodiesel) and 282 ktoe (bioethanol / bio-ETBE) by 2020. The renewable electricity production from solid biomass amounts to 12.0 TWh (1030 ktoe) and for biogas it is expected to be 4.7 TWh (401 ktoe). The consumption of renewable heat is expected to all to 650 ktoe for solid biomass and 288 ktoe for biogas. A contribution of 582 ktoe is expected from bio-methane for grid feed-in by the year 2020.



Clean and Efficient Program

The Clean and Efficient Program, launched in 2007, aims to improve energy efficiency by 2%/year over the period 2011-2020 and to reduce greenhouse gas emissions by 30% by 2020 compared with 1990. The program uses different measures to achieve its objectives, inclunding energy efficiency standards.



Heat from renewable sources is promoted through a premium tariff (bonuses on top of the wholesale price) inclunding tax benefits.

The Netherlands has adopted an obligation scheme which should result in a 10% RES share of energy consumption in the transport sector. Tax credits exist for biofuel and hydrogen related RES-T investments.



For companies investing in renewable energy source (RES) projects, a tax relief (EIA) exists, which contributes substantially to the project’s economic viability. Annual budgets are limited and regularly exhausted for some technologies and underexploited for others.



The Green Transaction aims to eliminate obstacles, for example statutory and regulatory problems, ensure effective and objective data provision and bring about effective cooperation. In practice, simple solutions such as better cooperation between government and local enterprises often turn out to promote the implementation of new sustainable projects. The Green Transaction covers specific projects in such areas as energy saving, sustainable energy, sustainable mobility and sustainable use of raw materials and water. The Dutch Government is set to conclude further Green Deals with society in the coming years. Citizens, enterprises, organisations and other authorities are asked approaching up with new proposals by February 2012, with the themes covered being energy, raw materials, mobility and water.

Energy debates

European Energy Network

The Netherlands is member of the EnR, which is a voluntary network of European energy agencies which aims at promoting sustainable energy good and best practice. EnR as well strengthens cooperation between members and other key European actors on all sustainable energy issues (energy efficiency, sustainable transport and renewable energy).

Role of government

Ministry of the Interior and Kingdom Relations (BZK)

One of the issues for this Ministry concerns energy saving in the built environment. The objectives of the related plan of action are to:

Energy procedure

TenneT B.V, the Dutch transmission system operator, owns and operates the 480 kV and 220 kV grids, inclunding the 150 kV grid in South Holland. The Dutch electricity act of 1998 stipulates that TenneT must provide the “most accurate possible estimates of the total capacity required for the transmission of electricity” once each two years. The national regulator, the Dutch Competition Authority, again receives this statement. TenneT is as well obliged to produce a quality and capacity plan with a time horizon of seven years to develop the network. In addition to these, the in general Vision 2030 for the Dutch transmission grid between 380 kV and 110 kV, as produced by TenneT, is taken into account at the same time as producing an in general network development plan. This responsibility lies with the Dutch government, which decides which projects are to be incorporated into the national Electricity Supply Structure Plan, which is produced by the government and implemented by the parastatal TenneT.

Energy regulator

This body comes under the Ministry of Economic Affairs, Agriculture and Innovation and is part of the Dutch Competition Authority (NMa).

Regulatory framework

The Office of Energy Regulation safeguards general access to electricity and gas networks and ensures that the tariffs and conditions concerning access and transport set out by electricity and gas network operators are non-discriminatory. The Office of Energy Regulation as well fixes annually the access and transport tariffs for regional electricity and gas network operators (DSOs).

Energy regulation role

Aside from the continuing Eurozone crisis and financing challenges and despite the CRA, the permitting procedures for renewable energy projects are still lengthy (inclunding possible appeals, on average, an onshore wind farm can take up to 15 months to fasten its required permits).

NL Agency, Energy and Climate Change sectionAgentschap NL

Stimulates international business and cooperation and a positive image of the Netherlands internationally and supports research programmes in energy. The NL Agency website provides a good overview of programmes, funding opportunities and incentives. Programmes focus on the bio-based economy, onshore wind energy, energy conservation, sustainable energy, heat and cold storage, and energy innovation.