Premium tariff (SDE+)
Updated: 09.01.2019
Author: Stijn Anciaux
The SDE+ scheme grants a premium on top of the market price to the producers of renewable energy in order to compensate for the difference between the wholesale price of electricity from fossil fuel sources and the price of electricity from renewable sources. The sum of the premium, paid on top of the market price, is variable and depends on the annual electricity market price development and is adjusted by a correction value accordingly (art. 13 (5) SDE+). The premium is paid for a period of up to 15 years. The support is made available in 2 stages with both 3 phases and is allocated on a ‘first come, first serve’ basis. The amount of the tariff increases with each stage, but since there is only one budget for the whole support scheme foreseen, applicants applying at a later stage run the risk of being rejected due to a lack of funds. In general, the SDE+ scheme gives an advantage to those applying for lower tariffs and at an early stage of the allocation process. The maximum base rate eligible under the SDE+ scheme corresponds to the maximum base rate in phase 6. For the first time in 2016, a two-stage application (both stages with three phases) procedure was available throughout the year. Thanks to the increased available budget and the amended application procedure for the SDE+, the Dutch government aims at coming one step closer to the 2020 goals of the EU for renewable energy. The two-stage procedure continued in 2017, with the first stage in March 2017 and the second stage in October 2017. The same procedure took place in 2018, with a first stage in March and a second in October.
Eligible technologies
In general, all renewable energy sources are eligible for the scheme. The support is made available in 2 stages both with 3 phases respectively. The eligible technologies differ at each stage. The regulation RAC 2018 describes the eligible technology categories As confirmed by the Netherlands Enterprise Agency, all installations shall be completed and put into operation within 4 years after the application for support was granted. The premium tariff will be paid once the installation goes into operation.
Wind energy | Eligible. Onshore wind: Eligible for all plants. Funding is provided based on the list of municipalities dived by average windspeed. (§ 3.1.3 art. 1 RAC 2018). Replacement of existing plants are also eligible under the following conditions ((§ 3.1.3 art. 1 RAC 2018):
Wind in dams: Eligible (§ 3.1.4) with the same conditions as onshore wind installations. Wind in lake: Eligible (§ 3.4 RAC 2014) for lakes with a minimum size of 1 km². Core of the plant has to be located at least 25 meters from the shore. Offshore wind (in national waters and in the sea): no longer eligible under the SDE+ premium since 01.10.2014. Tendering procedures are available. Full-load hours of wind-energy plants vary from project to project based on the net P-50 values. (§ 5.1, art.41 RAC 2018) |
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Solar energy | Eligible. The following PV installations are eligible, all with a maximum throughput value of 3*80A. of the connection to the electricity grid (§ 3.1.6 art. 14 RAC 2018):
Funding is provided for a maximum of 950 full load hours per year (§ 5.1 art. 41 RAC 2018) |
Biogas | Eligible. Biogas fermentation: The following plants are eligible for support of a maximum of 8,000 full load hours (§ 3.2.1 art. 16 RAC 2018 in conjunction with § 5.2 art. 42 RAC 2018):
Biomass gasification: (§ 3.2.3. art. 20 RAC 2018): Biomass gasification is eligible for 7,500 full load hours (§ 5.2 art. 42 RAC 2018) under the condition that at least 95% of the used fuel in the plant is biogenic. RWZI Improved Sludge Fermentation (§ 3.2.2. art. 18 RAC 2018): Improvements of existing plants with an increase of minimum 25% in production of biogas per ton sludge are eligible for support up to 8,000 full load hours per year. (§ 5.2 art. 42 RAC 2018) Extension of operating period of existing installation: No longer eligible under SDE+ premium since 2018. |
Hydro-power | Eligible in 2 categories (§ 3.1.1 RAC 2018). Head height of at least 50cm (art. 4 (b-c) RAC 2018): New plants are eligible for support for 5,700 full load hours per year (art. 41 RAC 2018). Renovated plants, in which at least the turbines have been renewed, are eligible for support for up to 2,600 full load hours per year (art. 41 RAC 2018). Head height lower than 50cm (art. 4 (a) RAC 2018): Eligible for installations with a head height ≤ 50 cm, under this category can the use of free running water which has not been pumped specifically for the purpose of electricity production and the use of tidal power be placed. The maximum number of full load hours per year is 3,700 (art. 41 RAC 2018) Osmosis: Eligible up to 8,000 full load hours per year (§ 3.1.2 RAC 2018 in conjunction with art. 41 RAC 2018) |
Biomass | Eligible. Installations for the combined heat and power production from thermal conversion or fermentation of solid or liquid biomass as in NTA 8003:2008 (Dutch Technical Agreement) Fermentation CHP (§ 3.3.3. art. 26 RAC 2018)
RWZI Improved Sludge Fermentation CHP (§ 3.3.4. art. 28 RAC 2018): Improvements of existing plants with an increase of minimum 25% in production of biogas per ton sludge are eligible for support up to 5,729 full load hours per year. (§ 5.3 art. 43 RAC 2018) Thermal Conversion CHP
Extension of operating period of existing installation: No longer eligible under the SDE+ premium since 2018. |
Amount
The SDE+ scheme grants a premium on top of the market price to the producers of renewable energy in order to compensate for the difference between the wholesale price of electricity from fossil sources and the price of electricity from renewable sources. The sum of the premium, paid on top of the market price, is variable and depends on the annual electricity market price development and is adjusted by a correction value accordingly (art. 13 (5) SDE+). Moreover, the amount of support is different for each renewable energy generation technology. The maximum basic premium and the level of funding awarded in each of the 6 stages differ according to the technology and the plant size.
Wind energy | Onshore: Installations ≥ 8 m/s (no maximum full load hours)
Installations ≥ 7.5 m/s and < 8 m/s (no maximum FLH)
Installations ≥ 7.0 m/s and < 7.5 m/s (no maximum FLH)
Installations < 7 m/s (no maximum FLH)
Dams (‘primaire waterkering’) ≥ 8 m/s (no maximum FLH)
Dams (‘primaire waterkering’) ≥ 7.5 m/s and < 8 m/s (no maximum FLH)
Dams (‘primaire waterkering’) ≥ 7.0 m/s and < 7.5 m/s (no maximum FLH)
Dams (‘primaire waterkering) < 7m/s (no maximum FLH)
Wind in lake with area > 1 KM² (no maximum FLH)
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Solar energy | Photovoltaic solar cells ≥ 15 kWp and connection > 3*80A (maximum 950 FLH)
Photovoltaic solar cells ≥ 1 MWp
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Biogas | Biogas: Fermentation of all substances (maximum of 8000 FLH)
(Co)fermentation of animal waste (maximum of 8000 FLH)
Mono-fermentation: only animal waste ≤ 400kW ( maximum of 8000 FLH)
Biomass gasification (maximum of 7500 FLH)
RWZI improved Sludge Fermentation (maximum of 8000 FLH)
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Hydro-power | Head height ≥ 50 cm New installations (maximum of 5700 FLH)
Renovations with new turbine (maximum of 2600 FLH)
Free running hydropower <50 cm and tidal power. New installations (maximum of 3700 FLH):
Osmosis (maximum 8,000 FLH):
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Biomass | Thermal Conversion CHP: Fermentation of all substances (maximum of 7623 FLH)
(Co) fermentation of animal waste (maximum of 7322 FLH)
Mono-fermentation: only animal waste ≤ 400kW (maximum of 6374 FLH)
RWZI- Improved Sludge Fermentation (maximum of 5,729 FLH)
Thermal Conversion CHP Boiler liquid biomass ≥ 0,5 MWth and ≤ 100 MWe (Maximum of 7000 FLH)
Boiler liquid or solid biomass ≥ 0,5 MWth and < 5 MWth (Maximum of 3000 FLH)
Boiler on liquid or solid biomass ≥ 5 MWth
Boiler industrial steam on wood pellets ≥ 5 MWth (Maximum of 7000 FLH)
Burner on wood pellets ≥ 5 MWth and ≤ 100 MWe (Maximum of 3000 FLH)
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Addressees
Entitled party. Every producer is eligible for premium tariff, e.g. private individuals, companies and institutions that generate electricity from renewable sources (art. 8 par. 1 SDE).
Obligated party. The Netherlands Enterprise Agency, Rijksdienst voor Ondernemend Nederland is obligated to provide support.
Procedure
Process flow | In order to receive a premium tariff under the SDE+, a producer must apply (online) to the Dutch energy agency through the Netherlands Enterprise Agency, Rijksdienst voor Ondernemend Nederland.There are different stages (see below) for the specific categories and the open category. Applicants may submit only one application per address on which the plant is planned to be installed per category (art. 2 (3) RAC 2018). According to information from the Netherlands Enterprise Agency, applications are processed in order of receipt. The energy agency will decide on an application, i.e. on the award of a premium tariff, within three months. Premium tariff under the SDE+ scheme is awarded only under the condition that the applicant presents certificates of origin to the Netherlands Enterprise Agency to prove that the electricity offered was generated from renewable sources (art. 1 (GGOEHE in conjunction with Article 1(1) RETO 2015). |
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Competent authority | Netherlands Enterprise Agency – Rijksdienst voor Ondernemend Nederland Certificates of origin are issued, in line with the regulations specified in the GGOEHE, and examined by CertiQ, an independent body for the issue of certificates of origin in the Netherlands. |
Degression
The base tariffs for the different categories of technologies are set on annual basis by the Minister of Economic Affairs and Climate Policy. The base tariffs should reflect the generation costs for the specific technologies. (art. 11 (1 and 2) SDE).
Cap
The scheme's budget is capped at € 6 billion for the autumn of 2018. Just like in 2017, a two-stage application procedure is available throughout the year 2018. The first stage took place in March and the second stage in October 2018. With two stages that both have 3 phases respectively more projects can be submitted. Thanks to the increased available budget and the amended application procedure for the SDE+, the Dutch government aims at coming one step closer to the 2020 goals of the EU for renewable energy. For the maximum number of eligible full load hours per year, please refer to the specific technology field under the eligible technologies.
Eligibility period
Premium is paid for a period of 15 years starting at the date of commissioning of the plant in question (art. 7 SDE in conjunction with art. 5 (1), 9 (1), 11 (1), 13 (1), 15(1) RAC 2018). Support for the generation of biomass and biogas however, is paid for a period of up to 12 years (art. 7 SDE in conjunction with art. 17 (1), 19 (1), 21 (1), 27 (1), 29 (1), 31 (1), 33 (1), 35 (1), 39 (1) RAC 2018). There is one exception on this matter, boilers of industrial steam on wooden pellets receive a payment period of 8 years (art. 37 RAC 2018).
Distribution of costs
State | Costs are covered by the state budget. The Ministry of Economic Affairs and Climate Policy has provided funds amounting to € 6 billion for the SDE+ scheme in spring 2018 as well as autumn 2018 (art. 2 (1) RAC 2018). |
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