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Netherlands

Netherlands

Huge demand but market stagnates -- Renewables sales soaring

Two months after the liberalisation of the Netherlands' green electricity market for domestic consumers on July 1, the number of green power subscribers continues to rise substantially, reports market monitor Greenprices. At the end of August, around 630,000 customers had asked for green energy compared with some 530,000 in July. Altogether around 9% of Dutch households have chosen to go green.

While the largest power companies, Nuon and Essent, can claim the lion's share of the market with around 200,000 customers each, smaller electric utilities are also getting in on the act. Limburg's Nutsbedrijf Maastricht, for example, now has some 4500 green energy customers on its books while other local suppliers, Westland Energie and Cogas, have around 5500 and 8500 green energy customers, respectively.

Market newcomers Echte Energie and Energie Concurrent, both of which supply 100% green power, are also growing strongly. Energie Concurrent, which aims to undercut the green electricity pricing of the utilities, currently has around 4500 customers.

Echte Energie, which allows its customers to choose between different sources of renewable energy, now has some 5000 signed up, though has capacity for an estimated 10,000 households. The company has also announced that it is to extend its customer base to small and medium size businesses who will be free to choose their green electricity supplier from January 2002.

With the Dutch borders closed to imported green power and the majority of domestic green kilowatt hours generated from wind, the soaring sales should be good news for the Dutch wind sector. But the success of government plans to stimulate production through the use of tax breaks to boost demand for green electricity is still in the balance. As yet the rising demand for green power has not resulted in a sudden growth of Dutch wind capacity. Market forces, it appears, are no match for Dutch planning regulations which are still proving to be a major barrier to development.

To meet rising demand for green power, the Netherlands' second largest power company, Nuon, intends adding 100 MW to its installed wind capacity this year. Only 13.2 MW of this will be built in the Netherlands, however. The rest will be constructed in Germany.

A recent court ruling also suggests that independent wind energy producers are likely to see very little of the immediate financial benefits of the green electricity sales. Wind farms tied into long term contracts with power companies -- most Dutch wind farms -- have been told to hand over their green certificates directly to the power company, preventing them from trading on their own account or selling green power directly to the public (Windpower Monthly, September 2001).

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