ACM invites interested parties to submit opinions about planned tariff decision for Dutch TSO TenneT

Dutch transmission system operator (TSO) TenneT will incur additional operational costs when strengthening its high-voltage grid. In its tariff proposal for 2022, TenneT has informed the Netherlands Authority for Consumers and Markets (ACM) of those additional costs. The additional costs will have consequences for the tariffs that large-scale users have to pay. In order to mitigate the consequences for large-scale users as much as possible, ACM proposes spreading the tariff increase over the years 2022 and 2023. In addition to this proposal, ACM has also developed an alternative scenario, in which the ultra-high-voltage tariffs in 2022 remain practically the same, but, as a consequence, increase more steeply in 2023. ACM invites interested parties to submit their opinions about both scenarios, and will, on the basis of those opinions, take a decision regarding TenneT’s tariffs for 2022.

During the upgrade, TenneT has to shut down part of its grid. In order to prevent users from experiencing any problems resulting from that partial shutdown, TenneT has to divert the power temporarily. Since this is a vital part of the high-voltage grid, TenneT estimates that it has to spend approximately an additional hundred million euros for this ‘redispatch’. As a result thereof, the tariffs for large-scale users are expected to increase significantly between 2022 and 2023.

ACM plans to absorb the tariff increase by spreading the costs over 2022 and 2023 as much possible, with an eye to gradual price changes over time. To that end, ACM proposes an adjustment to TenneT’s tariff proposal. In this scenario, ACM uses auction revenues, which TenneT earns from auctioning cross-border capacity, not in 2022 but in 2023, thereby creating more leeway in 2023 for absorbing the expected increase. This means that, in 2022, the tariffs for businesses that are directly connected to the ultra-high-voltage grid will increase by 9%, and the tariffs for businesses that are connected to the high-voltage grid will increase by 15%. In addition to this proposal, ACM has published an alternative scenario for public consultation in which the ultra-high voltage tariffs remain practically the same in 2022, but increase more steeply in 2023 than in ACM’s original proposal.

Next to publishing TenneT’s tariff proposal, ACM presents the exact tariffs for 2022 in both scenarios. ACM invites interested parties to submit their opinions about these scenarios. ACM will subsequently take a decision regarding TenneT’s tariffs for 2022 on the basis of those opinions.

Offshore grid

Each year, ACM sets the revenues that the offshore-grid system operator is allowed to earn for carrying out its statutory duties. The Dutch Ministry of Economic Affairs and Climate Policy (EZK) grants a subsidy that matches the allowed revenues of the offshore grid. If the subsidy does not cover all costs, TenneT is allowed, under Section 42a, paragraph 3 of the Dutch Electricity Act, to charge the TSO of the national high-voltage grid the additional revenues. The subsidy does not cover all costs of the second phase of the offshore grid (the plots after ‘Hollandse Kust West’). Last year, TenneT indicated that it would charge the TSO of the national high-voltage grid these costs in the tariff proposal for 2022 if no decision were made about how these costs would be reimbursed otherwise. Considering that, so far, no decision has been made, TenneT does propose in its tariff proposal for 2022 charging the TSO of the national high-voltage grid these costs.

Consequences for consumers

Small-scale users and consumers are not directly connected to TenneT’s national grid, but receive their power through the distribution system operators (DSOs). The DSOs pay TenneT for the national transmission of electricity. They charge consumers and small-scale users both these costs as well as the costs they make themselves. The expected increase for consumers and small-scale users will be spread over the years 2022 and 2023. The tariffs are thus expected to increase by, on average, several euros in 2022. ACM will publish the final tariffs for TenneT and the DSOs on its website by the end of the year. By that time, it will thus also be known how much businesses and consumers have to pay exactly for the transport of electricity.

ACM invites interested parties to submit opinions about planned tariff decision for Dutch TSO TenneT

Offshore grid

Consequences for consumers

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