News item | 22-04-2022 | 15:15
The greenhouse horticulture sector must accelerate the energy transition in order to become climate neutral by 2040. To this end, the cabinet is presenting a coherent package with both sustainable subsidy options and tax adjustments that create the right financial incentives to invest in sustainable energy instead of natural gas. With this package, the government is supporting an acceleration compared to the agreements in the coalition agreement and the budget of millions for 2021. The provisional target for greenhouse horticulture in 2030 therefore comes to a bandwidth of 4.3 to 4.8 Mton CO.2-equivalents. The Minister of Agriculture, Nature and Food Quality wrote this in a letter to the House of Representatives today.
In accordance with the coalition agreement, the Netherlands wants to be a frontrunner in combating global warming. When developing policy measures, the cabinet is aiming for an emission reduction of 60%. All sectors, including greenhouse horticulture, contribute to achieving this emission reduction.
In the greenhouse horticulture sector, the cabinet sees great potential for being a frontrunner in energy-efficient and circular production of high-quality vegetables, flowers and plants. This requires an acceleration of the energy transition. This is not an easy task for the sector, also given the current high gas prices and uncertainties due to geopolitical developments.
Minister Staghouwer: “I find the motivation of entrepreneurs to supply high-quality products and to always keep innovating is typical of the greenhouse horticulture sector. This is also essential to get through the energy transition. Entrepreneurs ask the government for clarity for the future so that they can make investments that are profitable in the long run. The cabinet is happy to accommodate them in this by setting the course, creating better financial incentives and offering subsidy schemes to support them. Ultimately, it is up to the entrepreneur to make choices in his or her business operations.”
The sector organization Greenhouse Horticulture Netherlands presented an investment plan this week to accelerate the reduction of dependence on (Russian) natural gas. This plan indicates that the efforts of the sector and LNV are aligned; a good joint starting point for the future.
Financial incentives and tax measures
In order to ensure that climate targets are achieved in the future, the Minister of LNV and the sector will replace the current CO2 sector system in 2025 with a new effective, individually guaranteeing pricing instrument. The CO2 sector system is the result of a covenant with agreements between the sector and the government to reduce emissions. In contrast to the current system, the new system should encourage individual growers to produce more energy-efficiently. That is why, for example, the amount of the levy and thus the price for greenhouse gas emissions must be clear in the long term and in advance, so that the horticulturist can include this in investment decisions.
In addition, measures have been agreed in the coalition agreement that have a broader effect on greenhouse horticulture: lowering ODE rates (levy for storage of sustainable energy and climate transition) by 2023, treating large and small consumers more equally, increasing the rates on gas and lower electricity rates. In addition, the cabinet will abolish the reduced rate for energy tax in 2025. These measures are elaborated in the Tax Plan 2023 and 2024.
Opportunities for sustainable investments
The subsidy schemes Market Introduction Energy Innovations Glasshouse Horticulture (MEI) and Energy Efficiency Glasshouse Horticulture (EG) are specifically aimed at stimulating innovation and investments in energy saving in greenhouses. These schemes will reopen this year for an amount of EUR 7 million for the MEI and EUR 25 million for the EC respectively. The EC subsidy makes it possible, for example, to invest in LED lighting or other energy-saving techniques.
The coalition agreement describes how the Climate Fund helps sectors such as greenhouse horticulture to build the necessary energy infrastructure. Synergy is possible here between glasshouse horticulture, industry and the built environment, for example by linking residual heat, so that glasshouse horticulture can absorb peaks and troughs in the energy system. That is why a subsidy instrument is being developed to enable collective heating systems. In addition, adjustments are being made to the SDE++ subsidy scheme so that, for example, geothermal energy projects can be discussed earlier.
No compensation for current high gas prices
In this transition, the government cannot compensate for the high gas prices. The government is examining whether entrepreneurs who are going through the climate and energy transition but run into direct liquidity problems can be supported. For example by means of a guarantee loan, but especially by facilitating and accelerating investments, such as in energy saving.