2023: an eventful year
The energy transition is increasingly taking shape. The large-scale overhaul of the energy system, with fossil fuels making way for renewable sources, is really picking up steam, which became noticeable this year. The developments and events in 2023 are too numerous to list. In this annual report, we will therefore confine ourselves to describing the developments that most influenced our activities and the impact they had on our task.
Geopolitical developments
The loss of gas supplies from Russia caused gas prices to spiral in 2022. Fortunately, gas became more affordable again in 2023 thanks to the introduction of a price cap. Gas prices continued to fall during the year. Our dependence on other countries for our energy supplies has a significant impact on energy supply reliability and how we tackle the climate issue. Countries in Europe have responded in different ways. France, for instance, remains committed to nuclear power, while Germany has temporarily returned to using coal-fired power plants. At the same time, we have seen significant growth in the use of wind and solar energy in the Netherlands. These differences reflect the (political) tension within the energy transition between safeguarding the supply of energy and achieving climate targets. The choices made in this context have a direct impact on the magnitude of our task, as shown in the infographic later in this section.
National Energy System Plan (NPE)
The publication of the National Energy System Plan (NPE) at the end of 2023 plotted a clear developmental course for the energy system until 2050. With the NPE, the government has made indicative choices that lay the foundation for the development of this energy system: maximum supply, energy saving, smart deployment of energy and infrastructure, international cooperation and shared control. In this way, the greatest possible amount of security is provided and the best possible use is made of scarce renewable energy, labour capacity and physical space. Stedin welcomes the NPE, because it contains structuring choices that offer clarity in both the short and the long term. The plan provides insight into how the Netherlands will achieve the agreed energy targets and what investments will be needed in the coming period.
Political developments
July 2023 saw the collapse of the Rutte IV government, which has been a caretaker government since then. In a vote in September, the House of Representatives declared most of the topics relating to the energy transition to be non-controversial. The general elections held in November caused a sea change in the balance of power in the House. The new House of Representatives was seated on 6 December 2023. It has not declared any ongoing legislative procedures controversial where climate policy is concerned. The progress of and possible changes in climate and energy policies will depend on the stance of the new House of Representatives and the new coalition government that is ultimately formed. This should become evident in the coming period.
Netting scheme
In 2023, wind and solar energy played a prominent role. Stedin recorded 1.7 million new domestic solar panels in its service area in 2023. Solar panels are a huge success in the Netherlands. In the space of a few years, the Netherlands has become a global frontrunner in the per capita generation of solar power. This success is partly due to the netting scheme, under which consumers can offset their fed-in solar power directly against their consumption. However, netting increasingly results in hidden costs, which means that it has inadvertently led to inequality between households with those and without solar panels. Therefore, the government wants to phase out the netting scheme in the period 2025-2031. It is now clear that the proposal in its current form lacks political support. Therefore, the scheme will not be abolished for the time being.
Energy Act
The proposed Energy Act is currently being considered by the House of Representatives. This new Energy Act replaces the Electricity Act 1998 and the Gas Act and is essential now that the energy transition is causing revolutionary changes in our energy system. Due to the collapse of the government in 2023, the enactment of this law has been delayed, grid managers cannot yet start adding capacity to saturated electricity grids, and the greening of districts has not really come off the ground yet either.
Environment and Planning Act
The energy transition will require numerous and sometimes major adjustments that require spatial adjustments. We are communicating about this with our stakeholders in order to create public support. Participation, which had been voluntary until now, is mandatory since the new Environment and Planning Act (Omgevingswet) took effect on 1 January 2024. The Environment and Planning Act deals with the areas where people live, work and relax. This new law combines old laws and contains rules on what can be seen, heard and smelled outside. For Stedin, 2023 was all about preparing for the entry into force of this new law.
Nitrogen
On 2 November 2022, the Council of State ruled that the construction exemption contravened European law. The abolition of this construction exemption may cause delays in our projects, for example in building distribution stations or laying cables. Together with Netbeheer Nederland, Stedin is urging the central government and the House of Representatives among other things to prioritise grid managers when allocating nitrogen emission rights.
Following a letter to the House of Representatives dated 18 October 2023 from Mr Jetten, the Minister for Climate and Energy Policy, the Ministries of Agriculture, Nature and Food Quality (LNV) and Economic Affairs (EZK) held consultations with the provincial authorities about the nitrogen emissions permitting procedure. As grid managers, we provided input for this discussion. In addition, the outgoing minister examined the possibility of speeding up the nitrogen permitting procedure for energy infrastructure. This is because newly constructed energy infrastructure entails a structural nitrogen reduction. The Ministries of LNV and EZK are currently exploring the legal feasibility of a programme under the Environment and Planning Act that would put this into practice. In the meantime, we are working with Netbeheer Nederland and the Netherlands Sustainable Energy Association on a nitrogen coalition to draw attention to this issue.
Climate ambitions
At the end of 2022, Minister Jetten presented the enhanced climate targets. In 2023, we calculated the effects on Stedin’s workload of the increase from 49% to 55% of the emission reduction target for 2030 compared with 1990. This calculation, which is shown in the infographic ‘Progress of the energy transition’, resulted in a substantial increase in Stedin’s workload. This increase is also reflected in the investment plan that Stedin presented at the end of 2023. In this context, the grid managers have stated that they expect 75% of this workload to be feasible.
