ACM calls for attention to increasing transmission tariffs towards 2050

Households and businesses that continue to depend on natural gas will have to pay increasingly higher tariffs for the transmission of natural gas over the next 25 years. Estimates by the Netherlands Authority for Consumers and Markets (ACM), on the basis of current policy goals, reveal that the tariffs for households could be approximately four times higher by around 2050 than they are today. For large businesses that are directly connected to the national transmission system, tariffs will likely increase even further. More and more households and businesses switch from natural gas to sustainable energy. That is why the costs for natural-gas networks must be divided among an increasingly smaller group of households and businesses. In addition, system operators incur costs for removing unused natural-gas connections and natural-gas networks. The rate at which these costs rise depends on the speed of the energy transition, and more specifically, on when network users stop using natural gas.

In 2025, households with an annual consumption of 1,000 m3 paid 200 euros in transmission tariffs for natural gas out of a total natural-gas bill averaging 1,680 euros. ACM estimates that this will rise to approximately 790 euros towards 2050. The share of natural-gas network costs in the total bill of an average household will increase from about twelve percent to 35 percent, assuming that natural-gas prices and energy taxes remain the same.

Manon Leijten, Member of the Board of ACM, explains: “Rising transmission tariffs can have significant consequences for households and businesses that must ‘stay behind’ on the natural-gas network. That is why ACM now calls attention to this issue.”

Not everyone is able to stop using natural gas

Households and businesses are able to avoid the higher transmission tariffs for natural gas by switching to other renewable energy sources, but this is not yet possible for everyone. Some business processes, for example, cannot yet be made more sustainable, or because residents of rental properties depend on their landlords for sustainability measures and insulation. In addition, switching to sustainably generated electricity is sometimes not possible due to the congested grid.

ACM’s role

ACM sets the maximum tariffs for system operators, and, in that context, is held to the guiding principle that all costs (efficient or otherwise) of system operators are offset through transmission tariffs. While ACM does have (limited) options to distribute system operators’ costs differently over time, it cannot limit the costs for those who are lagging behind by forcing households and businesses that no longer use natural-gas networks to financially contribute. To limit the costs for ‘laggards’, ACM could implement a removal fee for households and businesses that switch away from natural gas. However, this is not desirable with a view to the energy transition and more energy independence.
The responsible ministers and the Dutch House of Representatives have more options. For example, by deciding to pay the removal costs for unused connections and natural-gas pipelines using public funds. This is currently being done, for instance, in the construction of the hydrogen network, where the Dutch central government financially contributes to ensure that the hydrogen network gets off the ground and grid tariffs remain affordable. Another option is to reconsider the obligation to remove natural-gas networks and natural-gas connections.