Netherlands Increasing Green Energy Subsidies A Positive

By increasing its SDE+budget for the last round in 2020 to €4 billion, GlobalData argues Netherlands’s CO2 reduction target by 2030 is feasible and affordable. (Source: RVO, Netherlands)
Netherlands Increasing Green Energy Subsidies A Positive
  • Netherlands' decision to increase its SDE+ budget from previous €2 billion to €4 billion is a positive for the country to achieve its CO2 reduction target, says GlobalData
  • This can give a boost to renewable energy development in the country as for the last round both old and new projects whose requisite permits were not in place stand a chance to move ahead
  • It will help bring down the cost curve for wind and solar energy, according to GlobalData

The Netherlands will get closer to achieving its 49% CO2 reduction target in 2030 compared to 1990 as laid out in the Dutch Climate Agreement after the government has agreed on doubling green energy subsidies to €4 billion ($4.39 billion) for the 2020 Sustainable Energy Production (SDE+) spring round. Previously this budget was planned to be €2 billion ($2.19 billion).

Data and analytics firm GlobalData makes this assertion and says the CO2 reduction target achievement will be affordable with this increase in budget.

"The 2020 SDE+ will be used to help projects that have a short implementation period and those projects which did not get funding in the previous tender. This is expected to give an extra boost to the development of renewable energy through the stimulation of both new and old projects for which the required permits were previously missing," explained GlobalData Power Analyst Bhavana Sri Pullagura.

Notably, the SDE+ round is in its last leg as after the SDE+spring tender round, the government will introduce the SDE++ system, under which in addition to categories for renewable energy production, CO2 reducing options will be also eligible for subsidies, including energy efficiency measures.

"By 2030, the renewable energy capacity is projected to increase at a compound annual growth rate (CAGR) of 12%. The subsidies provided by the government will help in bringing down the cost curve for wind and solar energy, making them the most promising areas of new capacity additions. Both these technologies are slated to grow by more than 15% CAGR by 2030," added Pullagura.

In the SDE+Spring 2019 round, RVO Netherlands awarded 65% of the total budget to 2.51 GW of solar PV capacity (see Maximum Subsidy Under SDE+Spring 2019 Round For Solar).

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