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 sources and the price of electricity from renewable sources. The premium is paid for a period of up to 15 years. The support is made available in 2 stages 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 procedure was available throughout the year. With two stages more projects could 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. The two-stage procedure continued in 2018, with the first stage in March 2018 and the second stage in October 2018. Both stages have three phases respectively.
Eligible technologies
In general, all renewable energy sources are eligible for the scheme. The support is made available in 6 stages. The eligible technologies differ at each stage. As far as eligibility is concerned, RAC 2018 describes the eligible technology categories (Deep geothermal, thermal conversion of biomass, biomass digestion, solar thermal, production of “useful” heat at existing installations (biomass, biogas and bio-waste). RES H&C technologies with a base tariff that exceeds the maximum base tariff can apply for a lower base rate in one of the open categories. Useful heat is defined in Article 1 RISEP. 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.
Biogas | 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 |
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Biomass | Eligible. Inter alia: Fermentation CHP (§ 3.3.3. art. 26 RAC 2018)
RWZI Improved Sludge Fermentation (§ 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 7,000 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 SDE+ premium since 2018 |
Geothermal energy | Deep geothermal heat based on geothermal sources with a depth of (§ 3.3.2, art. 24 RAC 2018):
Funding is provided for a maximum of 6,000 full load hours per year for geothermal heat ≥ 500 m and for a maximum of 7,000 full load hours per year for geothermal heat ≥ 3,300 m (§ 5.3 art. 43 RAC 2018) |
Solar thermal energy | Eligible. Installations with enclosed solar collectors are eligible within the following categories (§3.3.1 art. 22 RAC 2014):
Funding is provided for a maximum of 700 full load hours per year (§ 5.3 art. 43 RAC 2018) |
Amount
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.
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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Biomass | Fermentation heat Fermentation of all substances (maximum of 7000 FLH)
(Co)fermentation of animal waste (maximum of 7000 FLH)
Mono-fermentation: only animal waste ≤ 400kW ( maximum of 7000 FLH)
RWZI- Improved Sludge Fermentation (maximum of 7000 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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Geothermal energy | Geothermal with depth ≥ 500m (maximum of 6000 full load hours)
Reconstruction of current oil and gas infrastructure ≥ 500 m deep (maximum of 6000 FLh)
Expansion production installation ≥ 500 m deep (maximum of 600 FLh)
Geothermal with depth ≥ 3500m (maximum of 7000 FLH)
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Solar thermal energy | Solar Thermal > 140kW and < 1 MW (maximum of 700 full load hours (FLH))
Solar Thermal > 1 MW (maximum of 700 full load hours (FLH))
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Addressees
- Entitled party. Every generator 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 support under the SDE+, a producer must apply (online) to 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 (Article 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. | ||||||||||||
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Competent authority | The Netherlands Enterprise Agency – Rijksdienst voor Ondernemend Nederland |
Degression
The base tariffs for the different categories of technologies are set on an annual basis by the Minister of Economic Affairs and Climate Policy. The base tariffs should reflect the generation costs for the specific technologies. (Article 11 (1 and 2) SDE+).
Cap
The scheme's budget was capped at € 12 billion for the applications in 2018, equally divided over the application round in spring and the application round in autumn.
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 tariffs for technologies under solar and geothermal categories are paid for a period of up to 15 years starting at the date of commissioning of the plant in question. The technologies under the biogas and biomass section are paid for a maximum period of 12 years, except for the boiler of industrial steam on wooden pallets technology that has a maximum period of 8 years.
Distribution of costs
State | Costs are covered by the state budget. The Ministry of Economic Affairs and Climate Policy has provided funds of €6 billion for the SDE+ 2018 spring scheme and € 6 billion for the SDE+ 2017 autumn scheme (Article 2 (1) RAC 2018). |
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