Stimulation of Sustainable Energy Production (SDE+)

With SDE+ the Ministry of Economic Affairs and Climate Policy aims to encourage the production of renewable energy in the Netherlands. Renewable energy is better for the environment, makes the Netherlands less dependent on fossil fuels and is beneficial to the economy.

Renewable energy is generated from clean, inexhaustible sources. This is why it is called 'renewable energy'.

What is SDE+?

The SDE+ (in Dutch: Stimulering Duurzame Energieproductie) is an operating grant. Producers receive financial compensation for the renewable energy they generate. Production of renewable energy is not always profitable because the cost price of renewable energy is higher than the market price. The difference in price is called the unprofitable component. SDE+ compensates producers for this unprofitable component for a fixed number of years, depending on the technology used.

The SDE+ is available for the production of:

  • renewable electricity;
  • renewable gas;
  • renewable heat or a combination of renewable heat and electricity (CHP).

For energy produced with biomass, there is a system of controls in place to ensure that it meets criteria for sustainability.

Eligible applicants

The primary target groups for SDE+ are companies, institutions and non-profit organisations. The project must be realised in the Netherlands. The national government is excluded from participation. Private producers of renewable energy are not eligible for a SDE+ grant because the costs exceed the benefits. Other local or national incentive regulations sometimes apply.

For those interested in applying to SDE+, it is worthwhile to read the four cornerstones of the subsidy to be aware of how the application process runs and what applicants may expect. There is also a step-by-step guide to help you with your application.

SDE+ in 2018

There will be 2 periods for SDE+ subsidy applications in 2018. One in spring and one in autumn. The SDE+ round of applications for spring 2018 is closed. The spring budget totals €6 billion.

It is expected that before summer 2018, the minister will announce the terms and budget for the autumn period. Submitting an application for autumn 2018 will likely be possible as of September/October.

Since the signing of the Energy Agreement in 2013, SDE+ has been made available to offshore wind farm projects in the North Sea. Tenders are presently entering a phase in which subsidy will no longer be offered unless the tenders do not yield an acceptable bid. You can read more about SDE+ involvement in the wind farm tenders.

News updates about SDE+ are published by the Netherlands Enterprise Agency as needed.

SDE+ contribution

The cost price for the production of renewable energy is set in the base sum for the technology. The energy price is established in the correction sum. The SDE+ contribution is base minus correction sum. This makes the level of the SDE+ contribution dependent on energy-price developments. When the price of energy is high, you receive fewer SDE+ and more from your energy consumer. When the price of energy is lower, you get more SDE+ and less from the energy consumer.

The correction amount is the average price of energy per category during the year of production. The base price of energy is the lower limit for the correction amount.

The maximum grant is reached when the correction amount is equal to the base price of energy. The final payments are calculated per year on the amount of energy produced and the actual price of energy.

Banking unused production

The Stimulation of Sustainable Energy Production Decision (Besluit SDE) allows for the possibility of banking. This means unused production which is subsidised can be used in later years (underproduction). In addition, producers can also carry over any excess output (this means that renewable energy is generated over and above the maximum subsidisable annual production) to a following year (overproduction). This can be used if production is lower than expected in a later year.

The latest form of banking is maximised to 25% of the subsidisable annual production. This ruling applies to all projects with the exception of wind projects where the wind factor provides an alternative to banking in covering the operator's risk of losing out on subsidy.

Alternative banking rules are applied to:

  • Offshore wind energy;
  • Categories involving co-gasification and co-firing of biomass in coal-fired power stations.

The banking system is explained in an infographic.

Teaser image for infographic Stimulation of Sustainable Energy Production

More information

More information in Dutch: Stimulering Duurzame Energieproductie (SDE+)

Every year, the Netherlands publishes information brochures about the various rounds of SDE+ applications. You can also consult renewable energy reports here that outline the Netherlands' ambition of 16% renewable energy by 2023.

The Netherlands Enterpise Agency carries out SDE+ for the Dutch Ministry of Economic Affairs and Climate Policy.

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