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Netherlands doubles renewable energy subsidies

In December 2019, the Supreme Court of the Netherlands ordered the government to cut the nation’s CO2 emissions by 25 per cent from 1990 levels by the end of 2020.

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The Dutch Government plans to double green energy subsidies to €4 billion in 2020, from a previously planned €2 billion to meet its promise to cut CO2 emissions.

 

Eric Wiebes, minister for economic affairs and climate policy, and member of the cabinet of the Netherlands, wrote to parliament explaining the measure was aimed at reducing CO2 emissions by 25 per cent by the end of 2020.

 

Energy transition

 

“There are a large number of projects that can offer a cost-effective contribution to further development, making the energy transition more sustainable,” said Wiebes.

 

According to data and analytics company GlobalData, the 2020 Sustainable Energy Production (SDE+) spring budget will make the Netherlands’ CO2 reduction target feasible and affordable.

 

The Dutch Climate Agreement aims to reduce CO2 emissions in the Netherlands by setting a national reduction goal of 49 per cent lower in 2030 than in 1990. In December 2019, the Supreme Court of the Netherlands ordered the government to cut the nation’s CO2 emissions by 25 per cent from 1990 levels by the end of 2020.

 

“The government’s resolution to reduce emissions by 49 per cent by 2030 will result in massive renewable energy capacity addition.”

 

One of the key policy measures to meet the climate goals is the SDE+ scheme, which provides financial support to the producers for the renewable energy they generate. The 2020 SDE+ spring tender round is the last time the SDE+ subsidy will be awarded in its current form. The SDE+ stimulation subsidy will later be expanded to an incentive for sustainable energy transition (SDE++).

 

“There are a large number of renewable energy projects that can offer cost-effective contribution for further development and make the energy transition more sustainable,” said Bhavana Sri Pullagura, power analyst at GlobalData.

 

“The 2020 SDE+ will be used to help projects that have a short implementation period and those projects which did not get funding in the previous tender. This is expected to give an extra boost to the development of renewable energy through the stimulation of both new and old projects for which the required permits were previously missing.”

 

Pullagura continued: “The government’s resolution to reduce emissions by 49 per cent by 2030 will result in massive renewable energy capacity addition. By 2030, the renewable energy capacity is projected to increase at a compound annual growth rate (CAGR) of 12 per cent. The subsidies provided by the government will help in bringing down the cost curve for wind and solar energy, making them the most promising areas of new capacity additions.”

 

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