When setting the tariffs for TenneT, ACM takes into account the extra costs due to the higher energy prices
As a result of the significantly higher energy prices, TenneT, the Dutch transmission system operator (TSO) for electricity, incurs additional costs for energy that needs to be bought, for example, for keeping the grid balanced. The Netherlands Authority for Consumers and Markets (ACM) wishes to prevent TenneT from subsequently having less room for investments in projects that are important to the energy transition. That is why, when setting the tariffs for 2024, ACM wishes to give TenneT an advance in connection with these higher costs. With this announcement, ACM wishes to inform market participants and other interested parties well in advance of the way in which ACM will incorporate the significantly higher energy costs in TenneT’s tariffs sooner.
>TenneT must buy energy for redispatch (for example congestion management), grid losses, and for keeping the grid balanced. The costs that TenneT incurs in connection therewith are always covered through the tariffs. This is done in the form of an advance based on estimates, after which the actual costs are usually settled ex-post two years later. As the energy prices have risen significantly, TenneT must pay a higher amount in advance. In order to prevent this from affecting TenneT’s financing ability, ACM has informed TenneT that it can expect an advance of 25 to 40% of the projected subsequent ex-post settlement for 2023. This means that the costs that TenneT is allowed to charge are passed on to consumers and businesses sooner.
At this point, ACM is not able to make a solid estimate of the advance’s effects on the tariffs for 2024. That will depend on, among other factors, the developments on the energy markets over the next few months. The exact amount of the advance will be determined by ACM when setting TenneT’s tariffs in November 2023. Each year, ACM will assess whether the market circumstances give reason for applying this method of advance payments to the 2025 and 2026 tariffs as well.
ACM decided last year that the distribution system operators (DSOs) could incorporate the higher costs into the tariffs for 2023.