Rising Dutch grid fees risk competitive deterioration

Network costs in the Netherlands are forecast to continue to rise over the coming decades, risking the country’s competitive position, finds a new study by Aurora Energy Research.

The study, Grid Fee Outlook for the Netherlands 2045, finds that the country’s fees are diverging more than those of neighbouring countries.

Aurora’s study shows that the Dutch energy-intensive industry will incur significantly higher grid fees in 2024 and that without intervention the country’s competitive position will further deteriorate towards 2045.

To bring Dutch grid fees for large consumers in line with those in neighbouring countries, over €300 million ($331 million) annually is currently needed, growing to more than $500 million ($551.2 million) by 2030. 

Network costs in the Netherlands are regulated by the Authority for Consumers and Markets (ACM) and cover transmission and system services.

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In the past two years, states Aurora Energy, costs have nearly tripled, rising from €897 million ($990.1 million) to €2.5 billion ($2.8 billion) in 2024, primarily due to adjustments for high energy prices in 2022.

Tennet, the Dutch transmission system operator (TSO), expects that costs will only decrease slightly in 2025 and 2026, as lower energy costs are partially offset by rising investments in the (offshore) grid and prepayments for future energy cost corrections. 

The Aurora study forecasts total network costs towards 2045, translated into grid fees for two typical consumption profiles: a flexible consumption profile of 3,000 full load hours and a baseload consumption profile of 8,000 hours.

The study shows that grid fees in Germany, Belgium and France are currently often more than 80% lower than in the Netherlands for both types of consumers.

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By 2030, Aurora expects that grid fees in the Netherlands will remain higher than those of neighbouring countries for baseload consumers—15 times as high as in France, 6 times as high as in Germany, and 4 times as high as in Belgium.

For flexible consumption, coming from new electrification technologies such as e-boilers and electrolysers, grid fees remain up to seven times as high as abroad, hindering the energy transition. 

Commenting in a release was Jesse Hettema, head of the Netherlands & Belgium at Aurora Energy Research: “Rising grid fees risk becoming the showstopper in the energy transition. Lowering fees is required to enable electrification of industry, which is essential to continue the build out of renewables. “ 

Added Björn Hofman, associate at Aurora Energy Research, said:  “The newly elected government indicated the ambition to pursue a more level playing field, which they can realise, but will come with a price tag. We hope this study will help in the understanding and in facilitating the discussion around the harmonisation of grid fees.” 

Aurora Energy Research’s study was commissioned by Tata Steel, Shell, Nyrstar, bp, Sabic and Chemelot

Representatives of the involved companies and Aurora presented the report to Minister Hermans of Climate and Green Growth on August 14. In an accompanying letter, the companies request the minister to develop measures for both the short and long term to ensure that network costs in the Netherlands align with those of other European countries.