ACM supports sustainable offshore wind power

The Netherlands Authority for Consumers and Markets (ACM) has drawn up rules for determining the revenues of the future offshore grid’s operator. This future grid will connect the offshore wind farms to the onshore grid. The Minister of Economic Affairs is expected to designate transmission system operator TenneT as the operator of the offshore grid. Interested parties will have six weeks to comment on the draft method decision.

Sustainable energy

The current Dutch administration aims to have an additional 3,500 MW of wind capacity built offshore. This will help towards the government’s plans to have 16 percent of its energy mix come from renewable sources by 2023. In its draft method decision, ACM has laid down rules about the compensation for the costs related to the construction and operation of the offshore grid.

Maximum permitted revenues of the grid’s operator

With these rules, ACM offers the future offshore grid’s operator clarity and certainty. In late-2016, ACM will be able to take a decision on the permitted revenues of that operator. The operator is expected to get these revenues through a subsidy from the Minister of Economic Affairs. Insofar that subsidy is not sufficient, the revenues will be received through the transmission tariffs of the national transmission grid.

Society as a whole will benefit if the costs of the offshore grid are efficient. Only the necessary costs (including a reasonable return) will be compensated. ACM will stimulate the grid’s operator to work as efficiently as possible, while making sure that they also have enough room for investments. ACM will do so by performing an efficiency test as soon as the grid is operational.

Depreciation period of 20 years

For the offshore grid, ACM has chosen a depreciation period of 20 years. That timeframe ties in with the current plans for the offshore grid, which uses a similar period. Combined with the regulatory period, which has been set at five years, ACM thus offers the future grid’s operator clarity and certainty. Should there be any concrete plans in the future to use the offshore grid longer than 20 years, ACM could extend the depreciation period in a future regulatory period, if necessary.

Consultation

This draft method decision will be open for consultation for six weeks. The final decision will be issued in the fall, together with the other method decisions for the onshore transmission system operators and the distribution system operators.