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ACM supports proposal for dismantling the net metering scheme

The Netherlands Authority for Consumers and Markets (ACM) supports the proposal put forward by the Dutch minister of Economic Affairs and Climate Policy (EZK) for dismantling the current net metering scheme (in Dutch: salderingsregeling) as soon as possible. On January 17, 2023, the Dutch House of Representatives will discuss the bill for dismantling the net metering scheme.

The net metering scheme was once a useful tool for stimulating investments in solar panels by consumers and other small-scale users. However, as investments in solar panels already pay off even without the net metering scheme, this extra incentive is no longer necessary. Moreover, the net metering scheme hinders a more efficient use of the grid because it curbs a more dynamic use of the grid and home batteries. In addition, households that do not have solar panels installed now indirectly pay towards the financial benefits for households with solar panels.

What is net metering?

Households that generate power using solar panels but do not use all that power themselves feed that excess power back into the public grid. Households may subtract the energy they produce from the energy they take from the grid at another point in time. This subtraction is called net metering. Net metering is therefore subtracting the number of kWh of power that somebody generates from the number of kWh of power that that person consumes. For more information, visit ACM consumers information portal ACM ConsuWijzer.

The net metering scheme creates extra pressure on an already overburdened grid. At times when the sun is blazing, there is a considerable supply of power from solar panels. Due to the net metering scheme, households with solar panels are not stimulated to consume that power at that time or to store that power locally in a home battery. This causes an enormous peak load on the grid, which, in turn, leads to higher transport tariffs for system operators. These transport tariffs are borne by all users of the grid.

At times when the sun is blazing, the retail price for electricity is often lower as well, since the supply of cheap power exceeds demand for it. Due to the net metering scheme, households with solar panels can subtract power generated at lower retail prices from the power that they consume at other times (often when prices are higher). As a result, suppliers incur additional costs that they incorporate into their tariffs. So, because of the net metering scheme, households without solar panels pay, with the current electricity prices, tens of euros per month extra for the supply of electricity.

ACM finds it important that consumers know where they stand, and therefore calls on the Dutch legislature to enshrine the rights of consumers with solar panels in the law more clearly. ACM thus argues that it is laid down in the law that, as long as the net metering scheme exists, the subtraction will take place when the annual bill (or final bill) is drawn up, and ACM is in favor of the legislature explaining clearly how the remaining consumption must be settled with supply tariffs that change more than once per year.

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