Netherlands Sees Climate Goals Threatened by Clogged Power Grid

(Bloomberg) — The biggest hurdle for the Netherlands to reach its climate goals is a overloaded power grid, putting at risk the country’s transition away from fossil fuels.

“Grid infrastructure is actually my main concern looking at the ambitions we have for 2030-2035,” Dutch Minister for Climate and Energy Policy Rob Jetten said in an interview at his office in The Hague.

A shift to renewable energy and growing demand for electricity has led to congestion issues. Grid operator TenneT Holding BV has already been forced to temporarily halt power supplies for new companies while the country’s network operators have warned billions in investments are urgently needed to meet rapidly rising demand.

Electric vehicle charging operator Fastned BV announced on Thursday it had to postpone its target to operate 400 charging stations in the country to 2025 due to grid connection delays. Across the country, companies are facing similar issues and have to halt expansion plans or put the electrification of their processes — needed to cut emissions — on ice.

With an action plan presented last December, the Dutch government is seeking to ease the pain. It’s aiming to establish a more flexible use of existing resources by promoting sharing of grid connections and running the most energy intensive operations when demand on the network is low. 

Investments in new grid infrastructure are also being accelerated by as much as €3.9 billion annually. Despite these measures “there will be scarcity for eight years or so,” Jetten said.

Energy Security

Power grid concerns aren’t the only energy issue the Netherlands is grappling with as the potential of gas shortages later this year looms. 

The country is trying to secure gas supplies ahead of the next winter after Russia’s invasion of Ukraine last year triggered a historic energy crisis in Europe, with supplier Gazprom PJSC curtailing most pipeline supplies to the region amid western sanctions. 

In response to the invasion, the Dutch government is working on ending all liquefied natural gas imports from Russia after already halting pipeline gas, coal, and oil imports from the country. 

Asked about supply concerns for later this year, Jetten is more optimistic. He’s able to point to gas storages which haven’t been fully depleted thanks to energy savings and a mild winter. Replenishing storage to a 90% target will be easier and “hopefully we can reach that for a better price than we did last year,” he said. 

Mounting concerns about supply security will raise pressure on Jetten to reconsider pumping more gas from the Groningen gas field. A final decision by the Dutch government on when to close the field is due in June.