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ECN publication
Title:
Can Dutch co-generation survive threats of the liberalisation of the energy markets?
 
Author(s):
Battjes, J.J.; Rijkers, F.A.M.
 
Published by: Publication date:
ECN Policy Studies 1-7-2000
 
ECN report number: Document type:
ECN-RX--00-027 Conference Paper
 
Number of pages: Full text:
18 Download PDF  

Presented at: 7th annual international conference, 'Managing the future growth of co-generation in Europe', Berlin, Germany, 22-23 mei 2000.

Abstract:
The paper presents an analysis of the effects of liberalisation of theDutch energy markets on the future development of combined heat and power generation (co-generation) in the Netherlands. First, it reviews the historical growth in co-generation in the Netherlands and the supportive policy measures that have contributed to this growth. Second, the liberalisation process of the Dutch electricity market and the Dutch gas market is described. Subsequently, we discuss the impacts of these new market structures on co-generation by using two scenarios for the Dutch energy markets. Our assessment of the impacts is mainly focused on the cost-effectiveness of co-generation projects. We determine the key aspects that influence the cost-effectiveness of a co-generation project and analyse some of the calculations for different small-scale and large-scale co-generation projects. Based on the results, we conclude that investments in new co-generation plants are unlikely in the short term and the existing plants can barely produce with a positive cash flow. As many parties have an interest in reducing the negative effects of a liberalised energy market on co-generation, approaches are sought to improve the cost-effectiveness of co-generation in the Netherlands. We describe several optional supportive measures for co-generation mainly resulting from the determination of the barriers for co-generation. Moreover, Dutch authorities have already responded to these barriers by preparing policy measures such as investment subsidies and exemption from the energy tax. 2 refs.


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