ACM: system operators can experiment with standard contracts for wind and solar farms

The Netherlands Authority for Consumers and Markets (ACM) has given all system operators two years to experiment with standard contracts for congestion management for new wind and solar farms. With these standard contracts, it becomes easier for system operators and sustainable-energy producers to make arrangements about congestion management, so that new wind and solar farms get access to the grid sooner. That is important for the energy transition.

Trade associations Holland Solar and Energie Samen support this plan of the system operators. Congestion management means that producers and buyers of electricity help reduce the burden on the grid. In return, they will be compensated by the system operators.

Manon Leijten, Member of the Board of ACM, says: “ACM wishes to accelerate the energy transition, and therefore wishes to create opportunities for initiatives aimed at optimizing utilization of existing grids. ACM welcomes the experiment with standard contracts for new wind and solar farms, because it means that these can be connected to the grid sooner.”

Utilizing the grid more efficiently

In many places in the Netherlands, the grid is overloaded. This has led to waiting lists for access to the grid. To eliminate these waiting lists, system operators must upgrade the grids, and system operators and consumers must see to it that existing grids are utilized as efficiently as possible. With congestion management, system operators have the ability to order wind and solar farms to impose temporary interruptions (partial or complete), if sufficient transport capacity is lacking at peak moments.

So far, congestion management contracts have not gotten off the ground easily. For example, it is not entirely clear yet what a reasonable compensation for flexibility is. If system operators need to make separate arrangements with each new sustainable-energy producer about the conditions (financial or otherwise) of congestion management, it will take up a lot of time. Such protracted negotiations will no longer be necessary for producers that will soon be able to use standard contracts with a price formula and a capped compensation for temporarily interrupting production.

Choosing a standard contract is on a voluntary basis. Producers that do not participate in standard contracts are still able to make individual arrangements with system operators. System operators also guarantee that they will keep grid capacity available for these producers. ACM will evaluate the effects of these standard contracts after two years at the latest.