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Netherlands

Netherlands

OBLIGATION ON UTILITIES TO BUY WIND

The Dutch government is considering placing an obligation on the country's electric utilities forcing them to buy renewable energy, including wind.

The news was broken on behalf of the Minister of Economic Affairs, Hans Wijers, by his director general, Stan Dessens. Speaking at a conference on deregulation of electricity production under the slogan "More Power Less Resistance," Dessens advanced on the White Paper on energy to be released before the end of the year.

Wijers wants less government intervention in the electricity sector and more control by market forces. However, he recognises that the Dutch government still has a role to play, especially where supply of electricity is vulnerable to short term forces where concern for the environment is a forgotten concept. By 2050 the industrialised nations will need to increase their use of renewables from 2% to 50% of energy consumption -- and more than an invisible hand of government will be needed to make sure this happens, he says.

The Netherlands will develop and execute a two pronged energy policy. The first is energy saving, preferably by 1.5% a year, reaching 35% in 2020. The second is by promoting the use of renewables, either by forcing distribution companies to buy electricity generated in a sustainable way, or by giving customers the option of paying more for green energy.

This second idea is based on an initiative by PNEM, the electricity distribution company covering the south of the country. PNEM has a scheme under which households are given the option of paying as much as NLG 0.09/kWh for electricity that has been generated by a renewable energy technology. Comparing it to buying free range eggs (in Dutch, scharreleieren), the scheme has already been nicknamed scharrel-elektriciteit -- free range electricity. To ensure PNEM does not sell more green power than it buys, the World Wildlife Fund has been taken on to check its books.

Obliging electricity companies to buy a fixed portion of their electricity from renewables seems to be a reaction to the postponement by utilities of the national goal for 1000 MW of wind power by 2000. The utilities have peremptorily reduced this to 400 MW, much to the consternation of government. The announcement of an obligation could well be a useful stick for threatening recalcitrant utilities. Using it might pave the way for people and companies interested in selling wind power to the grid.

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