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Update on offshore wind energy: letter of the Dutch Minister of Economic Affairs dated 22 January 2016

Update on offshore wind energy: letter of the Dutch Minister of Economic Affairs dated 22 January 2016

Update on offshore wind energy: letter of the Dutch Minister of Economic Affairs dated 22 January 2016

27.01.2016 NL law

On 22 December 2015, the Dutch Senate (Eerste Kamer) rejected the legislative proposal referred to as the STROOM Bill. The STROOM Bill comprised a merger between the Electricity Act 1998 and the Gas Act, which aimed, inter alia, to provide a statutory basis for the offshore grid and to designate TenneT as the offshore transmission system operator.

The political reason for the rejection of the STROOM Bill is the fact that the Minister of Economic Affairs, Henk Kamp, refused to comply with a motion filed by the majority of the Senate to postpone the unbundling of Eneco and Delta. The motion stipulated to suspend the group-ban article (i.e. the unbundling) until the moment the group-ban will also be enforced by other EU countries. Although this motion was supported by the majority of the Senate, Minister Kamp disregarded the motion. Eventually, the STROOM Bill was rejected. Minister Kamp mentioned that the rejection of the STROOM Bill could cause a delay of the subsidy tender with regard to the first two sites in the Borssele wind farm zone (Borssele I and II) of six months.

Letter regarding the anticipated timing of offshore wind energy

On 22 January 2016, Minister Kamp sent a letter to the Dutch House of Representatives (Tweede Kamer) regarding the way forward and timing of offshore wind energy in the Netherlands (please click here to view the letter). In his letter, Minister Kamp states that – with the rejection of the STROOM Bill – there is no statutory basis for the offshore grid and TenneT cannot be designated as the offshore transmission system operator. According to Minister Kamp, this would entail that the objectives of 14% renewable energy in 2020 and 16% in 2023, cannot be achieved. To ensure that the aforementioned objectives can still be met, Minister Kamp intends to send a new legislative proposal to the House of Representatives ultimately at the beginning of February 2016. Such legislative proposal would, inter alia, provide a statutory basis for the offshore grid and designate TenneT as the offshore transmission system operator.

Minister Kamp furthermore indicates in his letter that the Borssele I and II subsidy tenders can only be taken into account for the objective of 14% renewable energy in 2020, if the legislative proposal Minister Kamp intends to submit enters into force ultimately on 1 April 2016. If the proposal enters into force on 1 April 2016, the first Borssele tender closes at the beginning of May 2016 and the second tender would close at the end of September 2016.

If the deadline of 1 April 2016 is not met, this would put severe time pressure on the designation of TenneT as the offshore transmission system operator, due to the fact that the designation and the certification of TenneT by the Netherlands Authority for Consumers & Markets (ACM), can only commence after the legislative proposal enters into force. Such designation and certification of TenneT requires a mandatory advisory procedure of the European Commission of at least two months. For a timely realization of the offshore grid, TenneT needs to make its investment decision ultimately on 1 October 2016, whereas TenneT can only make such decision after it is designated as the offshore transmission system operator.

Minister Kamp therefore requests both the House of Representatives and the Senate to debate the legislative proposal expeditiously. In order for the legislative proposal to enter into force on 1 April 2016, the House of Representatives is requested to debate the legislative proposal before 19 February 2016, whereas the Senate is requested to vote on the proposal ultimately on 22 March 2016.

Conclusion

Pursuant to the letter of Minister Kamp, a legislative proposal that provides, inter alia, a statutory basis for the offshore grid shall be submitted to the House of Representatives at the beginning of February 2016. Subsequently, the legislative proposal is intended to enter into force on 1 April 2016. The first tender shall then open on or about 1 April 2016 and close at the beginning of May 2016, whereas the second tender would close at the end of September 2016.

For an overview of all English posts published on Stibbeblog regarding Offshore Wind Energy, please click here.

The post Update on offshore wind energy: letter of the Dutch Minister of Economic Affairs dated 22 January 2016 is a post of www.stibbeblog.nl

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