Options for a Renewable Energy Supplier Obligation in The Netherlands

Tue Jan 01 15:24:38 EST 2013
By Daniel Radov, Robin Brejnholt, Ruxandra Ciupagea, and Harry Fearnehough with assistance from SQ Consult

Like most European Member States, The Netherlands has committed to challenging renewable energy targets that now require 16 percent of all energy to come from renewable sources by 2020. In this report prepared for the Dutch Ministry of Economic Affairs, Agriculture, and Innovation, a NERA team led by Associate Director Daniel Radov, with assistance from SQ Consult, analyzes various renewable energy policy options for The Netherlands. 

The team's analysis combines quantitative modeling of electricity and heat markets with detailed representations of different renewable energy policies. These policies include renewable energy certificate systems with different designs, including buy-out prices, technology-specific banding, and certificate banking. The team compared these to the country's existing renewable energy support system, the SDE+, which provides a form of contracts for difference for renewable energy, procured via a multiple-round auction. The modeling quantifies various standard policy appraisal criteria, including the amount of renewable energy produced, total social costs, impacts on energy consumers, and the level of profits. 

NERA's study analyzes the possibility and impact of "linking" a potential certificate market with such markets in other countries. Finally, the report analyzes how the renewable energy industry structure and the possibility of exercising market power could affect the operation of the different policies.

On the basis of NERA's analysis, the Minister for Economic Affairs recommended to Parliament that The Netherlands keep its current SDE+ system.

The report is also available for download on The Netherlands government website.