This is a best prospect industry sector for this country. Includes a market overview and trade data.
Last Published: 10/30/2017

Overview

Energy policies focus on developing a mix of resources that will assure reliable, affordable supply while recognizing the need to reduce reliance on carbon-intensive resources.  The Government supports deployment of renewables, energy efficiency, nuclear power, and relies on biomass co-firing and CCS to curb carbon emissions from coal and gas-fired generators.  The Dutch Government has in place a number of policies and programs to support decarbonization, but has no overarching goal for energy efficiency (EE).  These include building performance standards, long-term agreements with industry, and tax incentives. 
 
The Dutch power sector is unbundled, with a transmission system operator (TSO), eight Distribution Service Operators (DSO), over 25 producers, and 35 electricity retailers.  There are more than eight million connections in the Netherlands, with a total current demand of some 118.6 TWh.  A few large companies dominate distribution, production, and supply.
 
The Netherlands has approximately 31.25 GW of installed capacity.  The power mix is dominated by natural gas, followed by hard coal and wind.  Approximately one third of total installed thermal capacity is co-generation capacity.  There is little nuclear or solar capacity.
 
The 36,000 square miles of the North Sea belonging to the Netherlands offer many options for sustainable energy extraction, where oil and gas are currently extracted.  The first wind farms have been built, and major work in the coming years will add more offshore wind farms, with the goal of generating 6,000 MW in 2020.
 
Nuclear
Nuclear energy accounts for only 1.6 percent of electricity production in the Netherlands (the Borssele power station).  The Government has indicated that nuclear energy should remain in the energy mix, but there are no plans to build new nuclear power stations. 
 
Oil & Gas Industry
The Netherlands is the second-largest producer and exporter of natural gas in Europe, behind Norway.  It has offshore natural gas fields in the North Sea, as well as one of the world’s largest natural gas onshore fields in Groningen.  Political fallout over earthquakes related to gas extraction has led the Government to cap production from the Groningen field.  As a result, net gas exports have fallen sharply since 2014, causing output to fall from 27 billion cubic meters (bcm) in 2014 to 21.6 bcm in April 2017.  Further production limits are expected to result in continued production decreases in the coming years. 
 
Renewable Energy
Since 2015, the share of renewable energy in the overall energy mix has increased from 5.5 to 5.8 percent.  The share of renewable energy is expected to continue to grow in the coming years, but it will be difficult for the Netherlands to reach its 14 percent target by 2020.  Developments in offshore wind, small-scale renewable energy production, and reductions in total energy consumption will all have favorable impacts on the share of renewable energy.  However, solar power’s  slightly less rapid growth, limited opportunities for  industrial fermentation, and less heat production from waste incineration plants will be unfavorable towards reaching the target.  
 
Biomass
Biomass currently accounts for around 62 percent of sustainable energy production in the Netherlands.  By 2020, the Government wants to obtain at least 200 PJ (nearly 30 percent of the target) of energy from biomass.  The SDE+ subsidy program is the primary tool for achieving this goal. 
 
In the Netherlands, the Dutch Energy Accord of September 2013 adopted strict sustainability criteria for biomass, such as forest level certification, information on greenhouse gas (GHG) emissions, carbon debt and indirect land use changes (ILUC).  These strict conditions may make it impossible for Dutch buyers to implement long term contracts with pellet producers. 
 
Biofuels
The Netherlands is implementing the EU Directive by gradually raising its share of energy from renewable sources such as biofuels, biogas, and electricity for road transport.  The goal is to build confidence that biofuels are a viable energy source and can help the Netherlands move gradually towards the EU target of attaining a 10 percent share of biofuels in the transport sector by 2020.
 
Onshore Wind
The Dutch aim to have 6,000 megawatts installed power capacity from onshore wind turbines by 2020.  Currently there are 2,000 onshore wind turbines that provide 3,000 megawatts.
 
Offshore Wind
There are currently four Dutch offshore wind farms, producing a total of 957 megawatts. 
 
Solar Energy
An estimated 400,000 homes have solar panels, and corporate consumers are following suit.  Around two GW is installed, and strong growth is predicted for 2017.
 
Overview of the Dutch Power Generation Market
 

Gross Generation (TWh)98.6
From gas67.1%
From coal15.6%
From wind7.5%
From biomass/gas1.1%
From nuclear1.6%
From other generation7.1%
Final Consumption (TWh)120 (est)
Source:  Agora Energiewende
 
Consumption in Petajoules2000201520202035
Oil1173117312121253
Natural gas151711911040885
Coal325516326292
Renewables52136276491
Miscellaneous72889235
Net electricity imports65 (import)40 (import)75 (import)74 (export)
Total3204314430202882


Source:  ECN Dutch National Energy Outlook
 
Transmission/Distribution network 
Delivery Points8 million
Length of grid2,200 miles
Electrical Substations (high voltage)51


Leading Sub-sectors

Smart Grid:
The Dutch Government is accelerating the development of smart grids with its Intelligent Grids Innovation Program, which supports 94 pilot projects.  The Dutch Ministry of Economic Affairs produced a report listing all players in the Dutch smart grid sector.  The report is available on request from:  alan.ras@trade.gov.
 

Opportunities 

The electricity infrastructure requires major investments.  In the coming decades, a large proportion of the grids will need to be replaced.  As a result of market integration, cross-border electricity flows are increasing, which requires additional interconnection capacity.  The increase in sustainable and/or decentralized electricity production, the use of hybrid and electric cars, and the development of storage systems also require major adjustments and expansion of the network.  Large-scale capture, transport, and storage of CO2 will require an entirely new infrastructure. 

Web Resources

Market Analyses:            
2016 Top Markets Report – Renewable Energy
Energy Market Resource Guide 2017
 National Energy Outlook 2016
 
Trade Shows:                    
European Utility Week
October 3-5, 2017
European Utility Week website
 
SME Resources:                
Posted on the website of the Global Energy Team.
 
Contact:                              
Alan Ras, Commercial Specialist                                               
U.S. Commercial Service – The Netherlands
Alan.ras@trade.gov | +31-70-310 2418

Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.



Netherlands Energy Trade Development and Promotion