Dutch Grid Calls for Backup Power Supply as Shortages Loom

The Dutch grid operator called for additional measures to safeguard electricity supply as surging demand and the transition from fossils fuels threaten power shortages by the turn of the decade.

The Netherlands faces increasing risks that it won’t be able to fully meet electricity demand in 2030, according to a report issued by Tennet Holding BV for the Economy and Climate Ministry on Wednesday. Soaring solar and wind generation and more batteries will be “insufficient” to fully offset the decline of fossil fuel power plants, especially during prolonged shortages, it said.

The risk to security of supply is mainly caused by a mix of “rapidly growing electricity demand, due to electrification, and a decline in dispatchable generation capacity both domestically and abroad,” according to a statement from Tennet.

Tennet called on the government to create a market for backup power supplies by the winter of 2029-2030 to maintain the system’s reliability. The so-called capacity mechanism would pay power plants to be available, even when they are not being used.

The grid operator also advised the Netherlands “to align with countries that already have or are considering a capacity mechanism.”

Europe’s grids increasingly need reliable backup sources during periods when the sun doesn’t shine and the wind doesn’t blow. Capacity markets also provide a crucial source of income for fossil fuel plants that are running for a diminishing number of hours per year.

Tennet’s advocacy for a capacity market underscores the crucial role that gas-fired power plants will continue to play in Europe even as the region works to reduce its reliance on the fuel. While gas and coal plants will continue to see their share of the energy mix fall, they remain an important source of dependable supply that can fire up as needed to keep the lights on.