Dutch increase 2016 renewables budget

Argus Media
October 14, 2015
Written by Argus Media
October 14, 2015 — The Dutch government has massively increased the budget for next year's SDE+ subsidy scheme to support renewable energy in the country. The increased budget gives hope that more than one biomass co-firing project can obtain approval next year, traders said.

The SDE+ scheme will have two tender rounds in 2016. The first round in March will have a budget of €4bn ($4.6bn), followed by a second round in September that will have a similar budget, the Dutch economic affairs ministry said. The budget is more than double the size of this year's budget, which stood at €3.5bn. The adjustments to the scheme are in an effort to meet the government's goal of 14pc renewable energy by 2020, the ministry said.

French utility Engie applied for funding this year for the conversion of its Rotterdam power plant to co-fire wood pellets with coal, while German utility RWE applied for its Amer power plant. Both biomass applicants failed to receive funding under the SDE+ scheme because the budget was heavily oversubscribed. 

The high number of renewable project applications deterred German utility Eon and Swedish state-owned utility Vattenfall's Dutch subsidiary Nuon from applying this year. The lack of subsidy meant Dutch utility Delta shelved its plans to co-fire biomass at EPZ's Borssele 12 plant, which will now be decommissioned this year. 

Market participants have been eyeing the resumption of utilities' co-firing under the new subsidy scheme, which will ultimately equate to around 3.5mn t/yr of biomass consumption. Dutch utilities have repeatedly stressed over recent months that the 2015 fund is "running low" and an increased budget next year will help support more biomass projects coming to fruition. And wood pellet producers have been pinning their hopes on an increased budget for 2016 to help soak up the considerable amount of supply coming on stream in the next few years.

The Dutch government had been in consultation on next year's budget for a number of months and had liaised with the Energy Research Centre of the Netherlands, and consulted members of the industry. The economic affairs ministry plans to release more details on the SDE+ 2016 scheme in November. 

Copyright © 2015 Argus Media Ltd. All rights reserved.

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