Dutch Administration Speeds up €100 Million Support for Solar Energy Storage in 2025

The climate minister of the Netherlands, Rob Jetten, has declared an early release of €100 million subsidy for the installation of 'time-shifting' battery storage integrated with solar PV undertakings for the upcoming year. This initiative is a fast track of a wider €400 million-plus scheme under the umbrella of its ambitious 'Multi-Year Climate Fund 2025'.

A Pioneering Move by the Netherlands Government

Jetten, who also heads the D66 party and holds the portfolio for climate and energy policy, disclosed the subsidy package while delivering Spring Memorandum 2024. This is one of the last major decisions by the current government, following the country’s House of Representatives elections in June, last year, which favoured the right-wing anti-immigration PPV party leading to forming of a coalition.

Spanned over a decade starting 2025, the €100 million allocation forms part of a broad €416 million plan designed for PV co-located battery energy storage system (BESS) technology, originally approximated at €41.6 million annually. Proposed to kick-off by 1 January 2025, the 2025 program's finer details are slated to be unveiled to the House later this year.

Jetten's manoeuvre results in more than a twofold increase in the first-year allocation, and the government also setting aside €200 million for the following year. This equates to a funding dispersal within the first two years, about seven times quicker than initially scheduled with the €200 million fund adjusted based on insights from the initial €100 million outlay.

Understanding the Utility of the Allocated Funds

The subsidy aims to provide an operational grant to projects for each kWh of energy transmitted into the power market during peak demand periods when renewable energy generation typically falls short.

The subsidy rate is anticipated to range between €0.14-29 per kWh of energy released. A reputed research and consultancy firm, CE Delft, has played a vital role in the assessment of the scheme thus far.

The initiative embraces all scale technologies, including rooftop solar PV CO-located with BESS as well as grid-scale facilities and multi-sized batteries. Though there are some stringent requirements by the government, a notable one being that from May to September, solar PV and BESS setup should not deliver electricity between 9 am and 5 pm. Instead, these hours should be utilized to charge the BESS with solar energy for discharge to the grid between 5 pm and 9 am, while participating in other electricity market routes during off-peak hours.

The government further mentions that a minimum of 75% of BESS’s energy should originate from co-located generation, a comparison to the prior 100% necessity for qualifying for an investment tax credit (ITC) in the US and for Germany’s Innovation Tender.

With PV co-located with BESS not being profitable, the subsidy becomes necessary according to the government. With the initial €100 million, it envisions backing the launch of 160-330MW of BESS.

Moving Towards a Sustainable Future

This proactive approach by the Dutch government highlights its commitment to accelerating the adoption of renewable energy technologies and supporting the integration of solar power with battery storage systems. By focusing on home energy storage systems and larger-scale applications, the Netherlands aims to enhance grid stability, reduce dependency on fossil fuels, and pave the way for a more sustainable and resilient energy infrastructure. This initiative not only benefits the environment but also empowers homeowners and businesses to contribute to a greener future.