The IEA recently published its most updated review of The Netherlands’ energy policies. The IEA’s announcement is available here. While EiD feels it is a good review, there is a heavy emphasis on renewable energy and energy efficiency certainly seems to be underplayed. it would be good to hear from friends of EiD if this is a wrong misinterpretation.
The following bullet points are for those who want a simple snapshot of the sustainable energy aspects:
• The country made notable progress in decoupling GHG emissions from economic growth and is on track to meet its targets under the Kyoto Protocol and the EU Burden Sharing Agreement, thanks to emissions reductions of non-CO2 GHG. In 2012, its GHG emissions were 8.8% lower than in 1990, while GDP had increased by 50% in the same period.
• On the basis of the coalition agreement, Building Bridges, of 29 October 2012, the Netherlands reached a society-wide Energy Agreement for Sustainable Growth (the “Energy Agreement”) in September 2013 laying out the actions needed for the 2020 horizon.
• The Agreement shows a strong consensus on the benefits from doubling planned energy efficiency savings to 1.5% or 100 PJ from the country’s final energy consumption by 2020 and deploying more renewable energies (14% by 2020 and 16% by 2023). It promotes sustainable energy at local level, network investment and a strong EU Emissions Trading Scheme. It also supports the transition to clean coal and carbon capture and storage technologies, energy savings and emissions reductions in transport, and the commercialisation of clean technologies, while stimulating employment and training.
• On the basis of the Agreement and the Climate Agenda of October 2013, the country reaffirmed its ambition to reduce CO2 emissions in the transport sector by 17% by 2030 and by 60% by 2050. It also supports an EU-wide reduction in GHG emissions of at least 40% by 2030 and further reductions of between 80% and 95% by 2050, in line with international commitments. The government considers this 40% goal a minimum commitment.
• Considerable challenges remain to be addressed by 2020, if the government wants to succeed in the transition towards secure, sustainable, competitive and affordable energy.
First, the Netherlands lags behind its national target for renewable energy sources and earlier leadership in wind power, while neighbouring countries have been strongly promoting renewables, notably Denmark and Germany.
Secondly, gas production from the large Groningen field is declining and the outlook for domestic unconventional gas remains uncertain.
Thirdly, electricity market dynamics are changing with high volumes of low or zero short- run marginal cost, low carbon prices and the strong competitiveness of coal over gas in power generation in Europe. As an open economy, the Netherlands benefits from trade, but at the same time it is impacted by global energy market trends as well as by the energy policy choices of its neighbouring countries. There is a high risk of increased market distortion from nationally focussed subsidies of renewables and capacity mechanisms in neighbouring countries. Global price differences in gas, coal and raw materials between the Netherlands and its major trading partners are growing with an impact on the competitiveness of the Dutch industry.
Fourthly, the Dutch energy sector, accounting for 10.9% of GDP, strongly defines the national emission profile. Despite the significant progress in decoupling emissions from economic growth and industrial energy efficiency, the Netherlands remains one of the most fossil fuel- and CO2-intensive economies among IEA member countries.
• In order for the Netherlands to reach its 2020 objectives, notably in the area of renewable energies and energy efficiency, it is important to ensure the effective implementation of the Energy Agreement. The government can maintain stability up to 2020 by ensuring a process for the progress review and for the co-ordination of the actions set out in the Agreement through a continuous dialogue with all stakeholders involved.
• Stability and predictability for energy investment are fundamental to secure the investments needed in the coming decade. In the Energy Agreement, a 16% share of renewable energy is foreseen in 2023. For the years beyond 2023, the parties have agreed that the Netherlands will formulate.
• Many important choices will have to be made with regard to the optimal decarbonisation pathways for 2030-50, notably in the industry and transport sectors which remain CO2- intensive.
• In order to achieve the 14% renewables goal by 2020 and 16% by 2023, the Netherlands will need to adopt a comprehensive and longer-term policy for renewable energies. The parties to the Energy Agreement undertook a broad range of commitments for scaling up renewable energy generation, notably onshore and offshore wind capacities, through the planned integrated offshore electricity grid by TenneT, competitive tendering of offshore wind capacities, the participation of local residents in the planning and operation of wind farms and through tackling other non-financial barriers.
• The energy security situation is increasingly complex and requires a comprehensive assessment of all aspects, including security of gas supply, the interlinkages of electricity and gas systems, climate change impacts and the system integration challenges imposed by the future increase of variable renewable energies.
Energy in Demand - Sustainable Energy - Rod Janssen 