Offshore Developments in the Netherlands: Updates on the Wind Energy Roadmap and Offshore Hydrogen Demo Project
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I'm a leading telecoms and media lawyer at Bird & Bird in The Netherlands. Based in The Hague, I am a partner in our Commercial, Regulatory and Data Protection Groups, and a member of our Tech & Comms, Media and Life Sciences Groups.
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Netherlands
As senior associate in our Competition & EU Law and Regulatory Groups in The Hague, I specialise in regulatory disputes and administrative law, with a focus on the technology, communications and energy & utilities sectors.
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Netherlands
As an associate in our Regulatory and Competition & EU Law team in The Hague, I advise on a wide range of regulatory matters and EU law, with an emphasis on sustainability, including ESG, Energy, and Environmental Law.
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The Dutch government remains committed to achieving 21 GW of operational offshore wind capacity by 2030. In addition, the Dutch government is committed to stimulating the development of offshore hydrogen production by subsidising two demonstration projects that should lead to a total capacity of up to 550 MW by 2033.
On 21 November 2024, the Dutch Minister of Climate Policy and Green Growth provided an update on the ‘Offshore Wind Energy Roadmap’ (Routekaart Windenergie op Zee) and the subsidy process for the ‘Offshore Hydrogen Production Demonstration Project 1’ (Demo 1).
Update on the Offshore Wind Energy Roadmap
Permitting of Wind Farm Sites
The Dutch government has realised that the cost of developing offshore wind farms is high and rising. The government has therefore decided to split the wind farm zones for the upcoming tenders (IJVer Gamma and Nederwiek I) from 2 GW to 1 GW, resulting in smaller sites, i.e. Gamma-A, Gamma-B, Nederwiek I-A, and Nederwiek I-B.
For future wind farm site permits, the government is investigating whether a feed-in tariff combined with a two-sided ‘contract for difference’ (CfD) can be used to make the business case for offshore wind farms more attractive.
With a feed-in tariff, large producers contribute to the costs of the grid. This is unique in the Netherlands, where in principle only the users pay for the use of the grid. The idea is to combine the feed-in tariff with a two-sided CfD, which means that the government will subsidise offshore wind producers when energy prices are relatively low but will, in turn, receive a fee when energy prices are high. A CfD is a mechanism to ensure stable energy prices in the long term. The interdepartmental policy research bureau (IBO) is currently investigating alternative financing of the grid in the Netherlands, including feed-in tariffs. The results of this investigation are expected in the first half of 2025. In addition, the government is investigating whether the SDE++ subsidy scheme can be used in combination with a CfD for offshore wind energy production.
On 22 November 2024, the Ministry published the draft wind farm site decisions (ontwerpkavelbesluiten) and draft tender regulations (conceptregeling vergunningverlening) for the upcoming tenders relating to offshore wind farm sites IJVer Gamma-A / -B and Nederwiek I-A. The tender procedure is expected to take place in the third quarter of 2025. Commissioning of the wind farms is planned for 2030/2031. Look out for our article(s) on these draft regulations.
Realisation of wind farm sites Nederwiek I-B and Doordewind I
The tender process for Nederwiek I-B is postponed due to concerns about the air routes to, and therefore the safety of, the K13-A gas transit platform (which is located close to Nederwiek I-B). The government is currently assessing how to address this issue and expects results in the second half of 2025. The government aims to grant the permit for Nederwiek I-B at the same time as the permits for Nederwiek II and Nederwiek III.
Similar issues have arisen at the Doordewind I wind farm site, which requires the spatial embedding of four oil- and gas platforms. The government plans to inform the Dutch parliament of the results of the feasibility study in the course of 2025.
Update on Demo 1
In order to make efficient use of the renewable energy produced by offshore wind farms and to ensure the flexibility of the onshore grid capacity, the government intends to use part of this energy for the offshore production of (green) hydrogen. With this in mind, the Dutch government will enable a consortium to realise an offshore green hydrogen demonstration project (Demo 1). The consortium will be selected on the basis of a call for proposals. After the selection, the government will prepare a tailor-made subsidy, which will be submitted to the European Commission for approval to ensure compliance with the state aid rules. The selected consortium will also have to apply for a permit.
In Demo 1, the selected consortium will build an electrolyser with a minimum capacity of 20 MW (the aim is 30-50 MW), including the necessary infrastructure. The project will be located close to the TenneT platform at the Hollandse Kust (Noord) offshore wind farm site and must be connected to this platform via the first offshore customer connection. ACM, the Dutch regulator, is working on a tariff structure for offshore customer connections. Gasunie (GTS), the Dutch gas network operator, will transport the produced hydrogen onshore and connect it to the national onshore hydrogen network. A total of €380 million is available for Demo 1. This budget is available for the entire project, including the realisation of the required (transport) infrastructure and the connection to the TenneT platform.
The Dutch government has recently launched an online consultation on the set-up of the call for proposals. Interested parties may give their views until 26 January 2025. The aim is to select a consortium by September 2025.
