Why do solar panel holders now have to pay feed-in costs to all energy suppliers?

In just under a year, the trend has spread from the relatively small energy company Vandebron to almost all other energy companies in the Netherlands. Last August, Vandebron began charging customers with solar panels when they feed the power grid with solar-generated energy. Essent and Engie announced this week that they will also provide these feed costs. Almost all energy companies have followed Vandebrun's lead.

What has convinced energy companies one after another in recent months to charge customers with solar panels?

The Netherlands has become a solar panel paradise. The most solar panels per capita are located here. The number of solar panels on Dutch roofs continues to grow. According to trade organization Netbeheer Nederland, approximately 2.6 million homes are equipped with solar panels. At the end of 2022, there were still 2 million.

Solar panels explode

The solar panel explosion was largely caused by government regulations. For example, thanks to a netting system, solar panel owners can offset the excess solar energy they supply to the grid at the end of the year against the energy they use from the energy company. This arrangement made the payback period of solar panels so short that people invested in solar panels en masse.

But the netting scheme costs energy companies a lot of money. Solar energy is often supplied to the grid at times when production is high and rates are therefore low. But sometimes these energy companies have to “return” that energy at times when prices are high, for example when the energy comes from a gas power plant. Additionally, keeping the power grid balanced costs power companies money when surplus power is collectively supplied to the grid at times when there is hardly any demand.

These costs for energy companies are settled with all customers. Also with customers without solar panels. The costs of restoring electricity are increasing due to the generation of more and more solar energy.

It stands to reason that Vandebrunn was the first to figure out a way to settle those costs last August. At this company, more than 40 percent of customers have solar panels, so Vandebron is more affected by these costs than its competitors. Other suppliers such as GreenChoice and BudgetEnergie soon followed.

Eneco will collect feed costs as long as compensation arrangements are in place

Last March, Eneco was the first of the Big Three energy companies to announce that it would introduce feed-in costs. The announcement came shortly after the Senate decided to keep the netting arrangements temporary. The netting scheme has been a topic of policy debate for years. “Eneco plans to pass on feeder costs as long as the compensation system is in effect,” the energy company wrote on its website. Vattenfall, another large energy company, followed later.

In addition to maintaining the compensation system, research by the regulatory body ACM also plays a role, says Energie-Nederland. ACM concluded in a report at the end of last May that the additional costs imposed by energy companies for supplying electricity are reasonable.

A few weeks after the investigation, Engie and Essent also followed suit by announcing the rollout of feeder costs, more than six months after Vandebrun started it. “Developing and implementing the right solution takes time. We believe it is important to provide clarity to our customers and so we chose this approach to provide return costs,” an Essent spokesperson emails. Energie-Nederland says the solar panels will still pay off, despite the feed-in costs.

Political confusion

Last week, confusion over the continuing existence of nutrition costs arose during a political debate. For a time it seemed that the intended coalition wanted to agree to ban this. In fact, this ban was about something less radical. The rate that customers with a dynamic contract receive for returned electricity may not be less than zero euros. Sometimes electricity prices are negative when supply is high.

However, the intended coalition decided last week, in contrast to the Senate earlier this year, to phase out the netting system. In one fell swoop in 2027. Return costs will likely then be eliminated.

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