Amendment of the Electricity Act 1998 and of The Gas Act (Progress Energy Transition)

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Laws and Policies

CCLW

CCLW national policies

Electricity Act 1998

Law passed

The Electricity Act (E-Act) 1998 is an important basis for the creation of the electricity market in the Netherlands. By establishing this market, producers and suppliers of electricity were able to offer electricity on a market. On April 9, 2018, the Energy Transition Act (wet VET) was adopted to amend the 1998 document and the Gas Act. The objective of this Act is to make the uptake of renewable energies in the country easier by reviewing extensively and in much detail the previous legal framework. The Act allowed for distribution companies and large consumers could buy electricity from generators other than the local one. While the Act limited large-scale production to the existing generators, it also allowed self-generation by industry and CHP production by industrial firms or by joint ventures involving distribution companies. The Act forced distribution companies to take in all electricity that was locally generated and supplied to them, and to pay a feed-in tariff essentially equal to the avoided costs. The E-Act also established, as of August 1, 1998, DTe, the independent regulator for the energy sector, as a chamber of the Dutch competition authority NMa. DTe was charged with supervising the sector and had the responsibility to guarantee non-discriminatory access to the grid for generators and to regulate the prices of the captive end users. The law forced energy companies to split their tariffs into network tariffs (including systems services) and tariffs for energy use as of the year 2000. DTe regulated the network tariffs and the final tariffs of the captive users, with the law imposing an RPI-X formula and the '1996=2000 principle' stating that overall prices in the year 2000 could not be higher than those that prevailed in 1996. As of 1 April 2014, the regulation for the feed-in tariff (SDE+) for 2014 has opened. This regulation includes the following features: a budget ceiling is established for all types of renewable energy such as wind, geothermal, solar photovoltaic, biomass and hydro phased opening a ‘free category' to enhance investments in certain technologies; feed-in tariff granted for a certain period (5, 12 or 15 years); a maximum subsidy amount for the Netherlands, to be determined annually (EUR3.5bn, USD5.4bn in 2014). Since its introduction in 1998 several amendments have been made to incorporate new elements such as the transposition of EU Directives. Several changes have been introduced in the E- Act in 2010, such as smart metering and congestion management rules for electricity) in order to improve the Dutch energy market.&nbsp;
New Energy Act 
Currently, a bill for a new Energy Act has been proposed to the Dutch parliament, which will be the legal foundation of the Dutch energy transition. This Act is now under discussion in the House of Representatives (Second Chamber) before it will be proposed to the Senate, who can either adopt or reject the bill. It will replace the current Gas Act and Electricity Act 1998, and provides a future-proof legislative framework for the energy transition, aimed at modernising and updating the regulative framework for electricity and gas. It also re-implements the EU Clean Energy Package (Directive 2019/944 on common rules for the internal market in electricity). &nbsp;

Electricity Act

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An aim to achieve a quantifiable outcome within a given time-frame, set by an institution such as a national government.

Policy instruments are techniques or tools used by governing authorities to promote certain policies in order to achieve predetermined goals. Put simply, instruments are how a government tries to achieve its goals, with this taxonomy being focused on national policy instruments.

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A set of principles, processes, and practices that build economic and political power to shift from an extractive economy to a regenerative economy.

Renewable energy means all forms of energy produced from renewable sources in a sustainable manner.

Fossil fuel is a generic term for non-renewable energy sources such as coal, fossil gas, and oil (including crude oil, and petroleum products), that can be used for electricity and heat generation. Fossil fuels are hydrocarbons formed from pressurised and heated organic material buried over millions of years.

Molecules in the atmosphere that play a key role in the greenhouse effect by trapping heat radiating from Earth’s surface.

Area of the economy in which actors engage in identical or related activities.

In human systems, the process of adjustment to actual or expected climate change and its effects, in order to moderate harm, increase resilience or exploit beneficial opportunities. In natural systems, the process of adjustment to actual climate change and its effects; human intervention may facilitate adjustment to expected climate change and its effects.

The management and allocation of funds, assets and investments to meet various objectives

The activities of industries involved in the production, distribution, and sale of energy, including electricity, gas, and renewables.

Either money or something of monetary value is transferred between two or more organisations, people or countries.

Production of electricity and heat from solar irradiation.

Kinetic energy of airflow transformed into useful energy, mostly electrical energy.

Activities that involve planning, designing and building infrastructure, residential, and commercial structures.

Compulsory, required payments to the government that are levied more-or-less in proportion to the services provided. Fees and charges range from entrance fees to national parks, charges on land-based sewage discharge.

Fossil gas, commonly known as natural gas, is a fossil fuel consisting chiefly of methane with smaller amounts of other hydrocarbons and trace gases, found in underground deposits.

The Electricity Act (E-Act) 1998 is an important basis for the creation of the electricity market in the Netherlands. By establishing this market, producers and suppliers of electricity were able to offer electricity on a market. On April 9, 2018, the Energy Transition Act (wet VET) was adopted to amend the 1998 document and the Gas Act. The objective of this Act is to make the uptake of renewable energies in the country easier by reviewing extensively and in much detail the previous legal framework. The Act allowed for distribution companies and large consumers could buy electricity from generators other than the local one. While the Act limited large-scale production to the existing generators, it also allowed self-generation by industry and CHP production by industrial firms or by joint ventures involving distribution companies. The Act forced distribution companies to take in all electricity that was locally generated and supplied to them, and to pay a feed-in tariff essentially equal to the avoided costs. The E-Act also established, as of August 1, 1998, DTe, the independent regulator for the energy sector, as a chamber of the Dutch competition authority NMa. DTe was charged with supervising the sector and had the responsibility to guarantee non-discriminatory access to the grid for generators and to regulate the prices of the captive end users. The law forced energy companies to split their tariffs into network tariffs (including systems services) and tariffs for energy use as of the year 2000. DTe regulated the network tariffs and the final tariffs of the captive users, with the law imposing an RPI-X formula and the '1996=2000 principle' stating that overall prices in the year 2000 could not be higher than those that prevailed in 1996. As of 1 April 2014, the regulation for the feed-in tariff (SDE+) for 2014 has opened. This regulation includes the following features: a budget ceiling is established for all types of renewable energy such as wind, geothermal, solar photovoltaic, biomass and hydro phased opening a ‘free category' to enhance investments in certain technologies; feed-in tariff granted for a certain period (5, 12 or 15 years); a maximum subsidy amount for the Netherlands, to be determined annually (EUR3.5bn, USD5.4bn in 2014). Since its introduction in 1998 several amendments have been made to incorporate new elements such as the transposition of EU Directives. Several changes have been introduced in the E- Act in 2010, such as smart metering and congestion management rules for electricity) in order to improve the Dutch energy market.&nbsp;
New Energy Act 
Currently, a bill for a new Energy Act has been proposed to the Dutch parliament, which will be the legal foundation of the Dutch energy transition. This Act is now under discussion in the House of Representatives (Second Chamber) before it will be proposed to the Senate, who can either adopt or reject the bill. It will replace the current Gas Act and Electricity Act 1998, and provides a future-proof legislative framework for the energy transition, aimed at modernising and updating the regulative framework for electricity and gas. It also re-implements the EU Clean Energy Package (Directive 2019/944 on common rules for the internal market in electricity). &nbsp;

Amendment of the Electricity Act 1998 and of The Gas Act (Progress Energy Transition)

Policy instrument

Renewable energy

Fossil fuel

Economic sector

Finance