ACM: further investigation into costs of and tariffs for solar power
The Netherlands Authority for Consumers and Markets (ACM) has concluded that consumers with solar panels who, on a yearly basis, feed more electricity into the grid than they consume, on balance have to pay for this surplus electricity that they feed into the grid. In the current bill for the Dutch Energy Act, the Dutch House of Representatives has, in part in the interest of the energy transition, included a ban on negative feed-in tariffs. ACM will sit down with the sector to discuss this development.
Negative feed-in tariffs and increasing feed-in costs
On their annual bills, consumers and small-scale business users with solar panels can deduct the electricity that they purchase from their energy suppliers from the electricity that they feed into the grid. If solar-panel holders, on a yearly basis, feed more electricity into the grid than they consume, they are entitled to a reasonable compensation from their energy suppliers. The energy suppliers set the feed-in tariffs themselves. As of this year, many suppliers charge their customers costs for feeding electricity into the grid (feed-in costs). A feed-in tariff becomes net negative when the tariff per kWh is lower than the feed-in costs per kWh after balancing under the net metering scheme. This is currently the case with several suppliers. ACM will conduct a further investigation into feed-in costs and tariffs.
Earlier this year, ACM carried out an investigation (in Dutch) into the tariffs of four major energy suppliers and concluded then that the investigated tariffs were not unreasonable. The feed-in costs have since increased across the entire market. On the basis of current legislation, energy suppliers are free to set their tariffs as long as these are not unreasonable considering the underlying costs. Given the increased feed-in costs, ACM will, in its tariff regulation, pay extra attention to the level of these costs.
Higher tariffs in model contracts
ACM will also investigate the tariffs of model contracts. A model contract is a standard contract with variable tariffs that all energy suppliers are required to offer. ACM establishes the conditions of these model contracts. It offers consumers the ability to always take out a contract for the supply of natural gas and electricity. It also increases the comparability of contracts.
According to August’s Monitor on the consumer energy market, model contracts are more expensive than other variable contracts. With model contracts, suppliers do not have ability to pass on the additional costs they make for households with solar panels by means of charging feed-in costs. That is one of the reasons as to why many suppliers have increased the standing charges, or the fixed supply costs per month, of model contracts over the past few months. As a result of this, customers with and without solar panels pay higher tariffs if they have a model contract. In order to ensure that model contracts remain a reasonable alternative for consumers, ACM will take a closer look at the tariffs and conditions.
In addition, ACM will revise the existing model contracts, in part because of the introduction of the new Dutch Energy Act. One question, for example, is whether suppliers should have the opportunity to charge feed-in costs in model contracts.