EnergieNed

1. EnergieNed

2. The Federation EnergieNed • EnergieNed is a broad-based federation for all companies playing an active part in the production, transport, trade or supply of gas, electricity or heat in the Netherlands • EnergieNed offers members a platform for consultation and exchange of knowledgeEnergieNed represents the interests of its members on a national and a European scale • Within the Federation EnergieNed, members have joined forces in the following sections: • Grid Administrators • Infrastructure companies • Electricity Producers • Trade and Sales • License holders

3. Federation EnergieNed Federation council Environmental Affairs Committee Board of Directors Section Infrastructurecompanies Section License Holders Section Grid Administrators Section Trade and Sales Section Production

4. Mission Statement and task of EnergieNed • The core function of EnergieNed is to strengthen the position of the (energy-)companies by • Lobby • Consulting Services • Platform function

5. Examples of products and services • representing members' interests in the political centres of The Hague and Brussels • promoting a balanced image of the sector • keeping members abreast of relevant issues in the Netherlands, the EU and elsewhere • advising on implementation of legislation, self-regulation, and legal matters • giving technical advice on the impact of legislation on infrastructure and management • providing fiscal and financial information and advice • designing energy-saving campaigns

6. Section Grid Administrators • The central consultative body for grid administrators jointly appointed under the Electricity Act 1998 • Deals with matters relating to the management of the electricity grid and DTe (Dutch Electricity Regulatory Service) • Develops proposals and decides on issues concerning the joint responsibilities of grid administrators • Represents the interests of members, particularly to DTe and during consultations on government policies that affect the position of grid administrators.

7. Sections • Section Infrastructure • Membership open to companies that provide infrastructure for the transport and distribution of electricity, gas and heat. • Section Electricity Producers • Membership open to electricity producers with more than 30 MW capacity • Section Trade and Sales • for wholesalers, traders and suppliers of gas, electricity or heat with sales exceeding 60 million m3 gas, 100 million kW h electricity or 50,000 GJ heat • Section License holders • for suppliers of electricity and/or natural gas to protected customers and suppliers of district heating

8. Sections • All sections deal with matters relating to the energy market, like e.g.: • energy policy • environmental policy • financial-economic and fiscal issues

9. Key data Dutch Energy sector

10. MWe % of MWeCentral (CHP Central included) 14.010 69CHP Combined Cycle Decentral 2.460 12 CHP steam turbine Decentral 930 5CHP gas turbines Decentral 1.010 5CHP gas engines Decentral 1.510 7 Wind power Decentral 4102 Hydro power Decentral 37 0,2 Other Decentral 82 0,4 Total20.448 100,0 Total installed electric power in The Netherlands (1999)

12. Share of CHP electricity in the electricity market %

15. Heat sales development of district heatingin The Netherlands PJ

16. Economics of a typical project • Heat cost price 5 NLG/GJ, heat sales 25 NLG/GJ, distribution margin 20 NLG/GJ, is 80 % of sales • Gas purchase price 40 ct/m3, gas sales 50 ct/m3, distribution margin 10 ct/m, is 20 % of sales • Margin ratio of heat supply : gas supply 4 : 1 Cost ratio of heat network : gasnetwork 3 : 1 Depending largely on type and development stage of the project

17. Heat price development for single family houses NLG/GJ

18. Views of the Dutch energy companies:determine the fuel savings of CHP by comparing fuel used with the fuels used of separate production of electricity and the separate production of heat Reference efficiencies: • For separate electricity production range 40 - 55% • For separate heat production range 60 - 90%

19. Policy of the NL energy companies (1) • Identification of CHP electricity • Introduction of CHP certificates • CHP certificates must lead to lower energy tax of the product “CHP electricity” • The amount of CHP certificates to be issued must have a relation to the fuels saved • Reference efficiencies for electricity and heat still to be determinded: proposal: take top 10% of world wide bench mark

20. Policy of the NL energy companies (2) Certificates can also be issued to “non CHP” electricity poducers when they realise the same amount of fuel savings compared to the same reference.

21. Two separate routes Supply Demand certificate market electricity market IB: Issuing Registration Redeeming

22. DEFINITION OF THE HEAT TO POWER RATIOOF A CHP UNIT Make a difference between: • the H/P ratio as design parameter and • the H/P ratio during operation

23. Conclusions from the CHP analyses

24. DH in The Netherlands characterized • Gas to Heat competition is very strong • Measures are taken to support CHP and DH • DH companies exploring new markets and applying advanced technologies • Optimized CHP unit sizes • Cost-effective distribution networks • Heat storage facilities implemented

25. DH situation • large share of CHP heat in the district heating projects (more than 90 percent of the heat) • high electrical and heat efficiencies in modern CHP units, mostly based on the combined cycle technology (electrical efficiency higher than 50 percent, heat efficiency over 30 percent) • heat storage facilities in the projects for flexible operation of CHP units • heat sales within 30 km of existing power plants is cost- effective • fuels for DH: gas 79%, coal 15%, waste 4%

26. Market trends • shift from connecting single family houses to connecting flats and big buildings, offices, hospitals and hotels • supplying heat to horticulture greenhouses • introduction of district cooling for hospitals and offices, for shopping malls, schools and universities and for fruit and fish terminals • succesful long run demonstration of district heated washing machines and district heated laundry dryers in 15 households • CO2 distribution to greenhouses (controlled CO2 supply is good for the growth process of the plants) • distribution of heat produced by centralized heat pumps

27. Support in the past • Firm and constistent energy policy • Loans, Grants and Subsidies • Risk sharing agreement between production and distribution companies • Favourable tariff policy for CHP gas • DH is part of the Environmental Action Plan of the Energy Sector (increase heat deliveries from 12 PJ to 28 PJ per year over the period 1991 - 2001) • Heat Plan of the Power Production Companies

28. Support today • contribution from CO2 reduction funds (NLG 50 per ton avoided CO2) • the energy tax on gas and on electricity goes to the government, but energy tax on heat (equivalent to the tax on gas) may be used in the district heating project • a 10% better forfait in the energy perfomance standard for new buildings, leading to more incentives for a builder to connect the building to a heat network • subsidy for low temperature heat consumer networks (500 NLG per house)

29. Principe van de netopbouw van een warmtedistributiesysteem Leveringsgrens 1 Leveringsgrens 2 secundair afl.station secundair aangesloten afnemer- installatie onder- station warmte-kracht centrale hulpketels secundair distributienet primair distributienet WKC HWC onder- station buffers primair aangesloten (grote) afnemers primair afl.station PRODUCTIE DISTRIBUTIE AFNEMERS

30. Heating horticulture greenhousesheat 10 percent discount compared to gas

31. Heat Map Instrument • helps to find those locations in the country which are most attractive for district heating • advanced computer model, a lot of parameters to vary • if heat demand density is greater than 25 houses per 10,000 m2 area, then district heating is economical

33. Benefits of district heating • fuel savings • clean, no noise • good for the environment • low cost to consumers (gas price equivalent) • high comfort • reliable and safe • individual heat metering • advanced technology, excellent service • good opinions, good press • saves room in your house

34. Environmental effect of energy carriers • electricity 558 g CO2 per kWhe (emission) • gas 1,78 kg CO2 per m3 (emission) • heat - 99 kg CO2 per GJ (avoided emission)

35. Available market developing instruments • Campaigns • Video promotion films • Bid generators • Face to face mini PC calculations • Slogans • Measurement of clients opinions • Workshops and lectures • Training • Information brochures • Leaflets

36. getting familiair with district heating • heat metering and temperature control • no more maintenance of boilers • low temperature consumer installations

38. Conclusions • District heating can grow in a competitive market • Competition stimulates creative solutions • The best solutions will win, and district heating is one of them • Heat delivery has many advantages compared to direct use of fuel or direct use of electricity for heating and cooling puposes

39. Success factors for substantial CO2 reduction • a large share of heat coming from CHP plants and a low share of heat from HOB’s • using heat storage facilities in the DH networks to ensure preference to CHP heat • avoiding separate production of electricity and/or separate production of heat • using cleaner fossil fuels and “renewable” heat sources • a high share of CHP in the heat and in the electricity market • rapid increase of heat delivery in the Western European countries • rehabilitation of Eastern European CHP plants and Eastern European DH networks