The European Commission has authorized the modification of a Dutch plan to decrease greenhouse gas emissions under European Union (EU) State assistance regulations. The initiative will also help the Netherlands meet its energy and climate targets, as well as the EU’s strategic goals for the European Green Deal.
The Netherlands informed the commission of its intention to revise its Stimulering Duurzame Energieproductie (SDE++) scheme, which was authorized by the commission in December 2020 (SA.53525) and updated in December 2021 (SA.100461). The updated plan will be in effect until December 31, 2025, according to a news statement from the European Commission.
The SDE++ assistance plan, with a total budget of €30 billion, will help the Netherlands achieve its goal of reducing greenhouse gas emissions by 55% by 2030 and reaching climate neutrality by 2050, compared to 1990 levels.
The initiative funds a wide range of projects with various technical methods, including projects based on low carbon and renewable petrol, such as hydrogen and transportation fuels. The Netherlands made many changes to the current system. These modifications, in particular, would ensure a specific budget for assisting initiatives in places where decarbonization is currently very expensive but has considerable green potential.
In 2023, a minimum budget of €750 million will be allocated to projects in the following areas: low-temperature heat (geothermal, heat pumps, and solar thermal); high-temperature heat (primarily electrification options for industry via heat pumps and electric boilers); and molecules (hydrogen production via electrolysis, biomethane production, and advanced renewable transport fuels).
Beneficiaries shall be chosen through yearly bidding processes that are competitive, transparent, and non-discriminatory. They will be chosen based on the lowest subsidy required per unit of decreased greenhouse gas emissions. Beneficiaries will receive assistance through a variable premium contract with a length of 12-15 years.
Beneficiaries’ payments will be modified depending on the evolution of relevant market prices (for example, electricity, gas, or carbon) during the term of the support contract. The commission evaluated the Dutch scheme’s change under EU State assistance regulations, namely the 2022 Guidelines on State Assistance for Climate, Environmental Protection, and Energy (CEEAG).
The commission determined that the plan is essential and suitable to promote greenhouse gas emission reductions and thereby contribute to EU and national climate objectives. The system has an ‘incentive effect’ since potential beneficiaries would not take out the activities without public assistance. The plan has a minor influence on EU competitiveness and commerce.
The aid is particularly appropriate, and any detrimental impact on competition and trade in the EU will be minimal due to the design of competitive bidding processes; bidding limitations for less expensive technology; and the large number of qualified recipients. These measures will guarantee that the quantity of help is maintained to a bare minimum. The commission authorized the Dutch program under EU State assistance regulations on this grounds.
