John LaurensonBusiness reporter, Rotterdam
AFP via Getty ImagesIn a Dutch government TV campaign called “Flip the Switch” an actress warns viewers about their electricity usage.
“When we all use electricity at the same time, our power grid gets overloaded,” she says. “This can cause malfunctions. So, use as little electricity as possible between four and nine.”
It is the sign that, in one of the most-advanced economies in the world, something has gone wrong with the country’s power supply.
The Netherlands has been an enthusiastic adopter of electric cars. It has the highest number of charging points per capita in Europe.
As for electricity production, the Netherlands has replaced gas from its large North Sea reserves with wind and solar.
So much so that it leads the way in Europe for the number of solar panels per person. In fact, more than one third of Dutch homes have solar panels fitted.
The country is also aiming for offshore wind farms to be its biggest source of energy by 2030.
This is all good in environmental terms, but it’s putting the Dutch national electricity grid under enormous stress, and in recent years there have been a number of power cuts.
The problem is “grid congestion”, says Kees-Jan Rameau, chief executive of Dutch energy producer and supplier Eneco, 70% of whose electricity generation is now solar and wind.
“Grid congestion is like a traffic jam on the power grid. It’s caused by either too much power demand in a certain area, or too much power supply put onto the grid, more than the grid can handle.”
He explains that the problem is that the grid “was designed in the days when we had just a few very large, mainly gas-fired power plants”.
“So we built a grid with very big power lines close to those power plants, and increasingly smaller power lines as you got more towards the households.
“Nowadays we’re switching to renewables, and that means there’s a lot of power being injected into the grid in the outskirts of the network where there are only relatively small power lines.”
And these small power lines are struggling to cope with all the electricity coming in from wind turbines and solar panels scattered around the country.
AFP via Getty ImagesDamien Ernst, professor of electrical engineering at Belgium’s Liege University, is one of Europe’s leading experts on electricity grids. He says it is an expensive problem for the Netherlands to solve.
“They have a grid crisis because they haven’t invested enough in their distribution networks, in their transmission networks, so they are facing bottlenecks everywhere, and it will take years and billions of dollars to solve this.”
Prof Ernst adds that it is a Europe-wide issue. “We have an enormous amount of solar panels being installed, and they are installed at a rate that is much, much too high for the grid to be able to accommodate.”
At Eneco’s headquarters in Rotterdam, Mr Kees-Jan Rameau highlights a large control panel that the company calls its “virtual power plant” and “the brain of our operations”. It is used to help balance the grid, avoiding blackouts.
When electricity generation is too high across the Netherlands, it enables Eneco to turn wind turbines out of the wind and turn off solar panels.
As for when demand for electricity is too high, it lowers the power to customers who have accepted to allow Eneco to stop or reduce their electricity supply when the network is under strain in exchange for lower prices.
But for homes and companies who want to scale-up their use of electricity with a new or larger grid connection, that, increasingly, is just not possible.
“Often consumers want to install a heat pump, or charge their electric vehicle at home, but that requires a much bigger power connection, and increasingly they just cannot get it,” says Mr Kees-Jan Rameau.
He adds that it is worse for businesses. “Often they want to expand their operations, and they just cannot get extra capacity from the grid operators.
And it has got to the point where even new housing construction in the Netherlands is becoming increasingly difficult, because there’s just no capacity to connect those new neighbourhoods to the grid.”
Those people, and companies, end up on waiting lists for a number of years. At the same time there are also waiting lists for those who want to supply the grid with power, such as a new home fitted with solar panels on its roof.
Tennet, the government-owned agency that runs the Netherlands’ national grid, says that 8,000 companies are currently waiting to be able to feed in electricity, while 12,000 others are waiting for permission to use more power.
Some sectors of the Dutch economy are warning that it is hampering their growth. “Grid congestion is putting the future of the Dutch chemical industry at risk… while in other countries it will be easier to invest,” says the President of the Dutch Chemical Association Nienke Homan.
So, was all this avoidable? “In hindsight I think almost every problem is avoidable,” says Mr Kees-Jan Rameau.
He adds that following the 2015 Paris Agreement on trying to tackle climate change, “we were very much focussing on increasing the renewable power generation side. But we kind of underestimated the impact it would have on the power grid.”
Tennet is now planning to spend €200bn ($235bn; £174bn) on reinforcing the grid, including laying some 100,000km (62,000 miles) of new cables between now and 2050.
That’s a huge amount of money, but there is also a big cost to not spending it. Grid congestion is costing the Dutch economy up to €35bn a year, according to a 2024 report from management consultancy group Boston Consulting Group.
Eugene Beijings, who is in charge of grid congestion with Tennet, says that patience is sadly required. “To strengthen and reinforce the grid, we need to double, triple, sometimes increase tenfold the capacity of the existing grid.
“And it’s taking on average about 10 years to do a project like that before it goes live, of which the first eight are legislation and getting the rights to put cables in the ground with all property owners. And only the last two years are the construction period.
“And meanwhile the energy transition is going that fast that we cannot cope with it, with the existing grid. So every additional request [to connect] is adding to the waiting list.”
Zet ook de knop omAt the Dutch energy ministry, which is actually called the Ministry for Climate Policy and Green Growth, the Minister Sophie Hermans wasn’t available for an interview. But her office gave a statement:
“In hindsight, the speed at which our electricity consumption has grown might have been collectively underestimated in the past by all parties involved. It is also hard to predict where the growth will occur first, as this results from individual companies/sectors and households.”
As for solutions, the ministry says it has a “National Grid Congestion Action Plan” focussed on adjusting legislation so grid expansion permits can be granted more quickly.
It is encouraging people to make better use of the existing grid with, for example, its Flip the Switch campaign.
And the financial incentive for people who feed their surplus solar electricity into the grid is being reduced to almost nothing. In some cases, people will even have to pay to feed solar power into the grid.
