*) The following countries fall under the CWE region: The Netherlands, Belgium, Germany, France and Austria.
- Electricity prices on the Dutch wholesale electricity market increased stronger than the Central Western European region average, due to a stronger impact of increased natural gas prices
- Lower electricity production in the Netherlands compensated by higher more imports
- SDE+ subsidy for sustainable electricity generation will in the near future cover almost a third of Dutch total electricity consumption
Figure: Day Ahead market prices for electricity in €/MWh in CWE countries from 2016 to 2018.
Strong impact of increased gas prices on Dutch electricity wholesale price
Electricity prices at wholesale markets in Europe increased, particularly due to increased prices of natural gas (+30%), coal (+5%) and CO2 emission allowances (+166%). Countries with a large share of electricity production from hydropower suffered from the dry summer, which led to higher electricity prices.
Dutch electricity prices saw a relatively strong increase in wholesale electricity prices compared to the CWE region average, due to the large share of natural gas-fired power plants in electricity generation. Because of this, the substantial increase in natural gas price had a relatively large impact. In recent years, the Dutch wholesale price has on average been lower than prices in France, Belgium and Great Britain, but somewhat higher than prices in Germany. Countries that saw a stronger increase in wholesale electricity prices compared to the Netherlands in 2018 are: Austria, Poland, Denmark, all Baltic states, Ireland and all Scandinavian countries.
More imports in the Netherlands in 2018
The generation of electricity in the Netherlands fell from 98.1 terawatt hours (TWh) in 2017 to 94.4 TWh in 2018. This decrease was ‘compensated’ by increased electricity imports. The higher net imports in 2018 can be attributed to the higher average electricity price in the Netherlands compared to Germany. Germany remains the main source of electricity imports in the Netherlands. This is partially enabled by TenneT's new cross-border high voltage connection (interconnector) between Doetinchem (NL) and Wesel (D), which came into operation in the second half of 2018.
TenneT is currently working on the further expansion of its interconnection capacity with other countries. In 2019 COBRA cable (700 MW) between the Netherlands and Denmark will become operational and in 2020 the NordLink cable (1,400 MW) between Germany and Norway. Additionally, the existing interconnection between Meeden (NL) and Diele (D) is being upgraded and the interconnection capacity with Belgium is being expanded.
The Netherlands exports most of its electricity to Belgium (10.8 TWh) and Great Britain via TenneT’s BritNed cable (6.7 TWh). Imports are coming mainly from Germany (20.9 TWh) and Norway via the NordNed cable (3.9 TWh).
Growth in sustainable generation capacity mainly due to solar PV
Although total electricity generation in the Netherlands fell in 2018, operational generation capacity increased from 30.4 GW (2017) to 31.0 GW. Operational capacity increased by 1.5 gigawatt (GW) through additional solar panels (1.1 GW) and onshore wind (0.4 GW). On the other hand, operational capacity decreased by 0.9 GW through the mothballing of the Moerdijk 1 gas plant and a gas unit from the Eemscentrale plant.
In the six-and-a-half years of the Dutch subsidy scheme SDE+, over 14 GW has been awarded to solar PV, onshore wind, hydropower and biomass co-generation; all either operational or planned. In the future, this capacity will cover an annual electricity generation of 34.5 TWh, which amounts to almost one third of total electricity consumption in the Netherlands.
About the 2018 Annual Market Update
The TenneT Annual Market Update is the successor of the annual TenneT Market Review. The Annual Market Update is largely comparable with the TenneT Market Review, but has a more compact format. This Annual Market Update focuses on relevant developments in the Central Western European electricity markets and the Dutch electricity market in particular. Read TenneT’s complete Annual Market Update 2018.
