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Netherlands

Netherlands

Pressure for end user quota

Pressure is mounting in the Netherlands for replacement of the voluntary agreement with utilities for a fixed quota of green power in the supply mix -- and its associated Green Label system and reliance on premium price sales -- with a system based on end-user obligations.

Under article 53 of the 1998 Electricity Act, the government reserved the right to require all consumers to include a percentage of renewables in their electricity consumption. The Dutch Association of Private Wind Turbine Owners (PAWEX) is calling for the government to invoke this article and replace the existing Green Label system and accompanying voluntary green-electricity schemes. "A voluntary system is too flexible and means that some polluters never pay," argues PAWEX's Mathieu Kortenoever. In its place PAWEX recommends the implementation of a legally based, unified system of certification with a single independent supervisory body and annual audits.

Addressing one of the grey areas in the present system, the PAWEX proposals also call for significant fines for non-compliance. At present utilities who fail to meet their target of 3% of total sales by end-2000 will have to make up their deficit from the surplus Green Labels of other power distributors at a price slightly above the then current market price for Green Labels. This implies that between them the utilities have acquired sufficient Green Labels to cover their collective obligation, and that there is a consensus about the market price of a Green Label -- both of which conditions seem at present unlikely to be fulfilled.

According to Kortenoever there is considerable resistance to these proposals. While the majority of the Dutch parliament is sympathetic to the principle of end-user quotas, it is strongly opposed by economics affairs minister, Annemarie Jorritsma. She hopes that a voluntary commitment from the end-user will be sufficient to stimulate renewables growth. At present Dutch power consumers can opt to buy nominally "green" electricity at a premium rate, with the extra revenue being returned to renewables development.

With major Dutch industrial concerns such as Akzo Nobel Energy, Corus (formerly Hoogovens) and DSM claiming that the government's current environmental policy will severely damage their ability to compete internationally, the government's imposition of further, legally binding end-user, quotas will clearly require a strong political will. Kortenoever also anticipates opposition from the utilities: "When the end-user becomes the customer they will lose their control of the energy market."

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