“Are the dishwasher and dryer already on?” It will be a question that is asked in many Dutch households, just before the lights go out in the evening. It may take some getting used to for new customers of energy supplier Greenchoice. Anyone who has solar panels and concludes a contract after April 1 will see that the off-peak and normal rates have been reversed: it will be cheaper to turn on the dishwasher or charge the car battery during the day – when the sun shines and solar panels provide extra power.
Greenchoice says it is making the rate change because it wants to encourage its customers to use green energy when it is available in abundance. So during the day. “This has a positive effect, especially in the summer. We think it is important that a social discussion about this is initiated. We hope to make a start on this by making consumption cheaper during the day than during off-peak hours,” said a spokesperson.
Since the 1960s, energy suppliers have offered cheaper electricity rates in the evenings and at weekends. This off-peak rate was introduced because the demand for electricity became much greater during the day than at night due to the rapid rise of electrical household products. To reduce the peaks and valleys, consumers were enticed to use some devices at night with a lower off-peak rate.
European leader in solar panels
This went well for a long time, until the energy transition of recent years shook up the balance between energy supply and demand. The Dutch power grid cannot keep up with the explosive growth of green energy. The Netherlands is also a European leader, with 3.5 solar panels per capita. The popular netting scheme turned the roofs of Dutch terraced houses into small power stations.
On a sunny day, solar panel owners only use 20 to 30 percent of the electricity they generate themselves, and feed the rest back into the grid. The netting scheme ensures that people who have generated electricity can return that electricity to the grid and use that amount of electricity for free at a later time.
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The result: an overloaded power grid where at times during the day there is a zero rate or the price even becomes negative. At night, when the sun is not shining, the power stations have to compensate for the power demand of all those dryers and washing machines. This drives up costs for energy suppliers. They must pay grid operators compensation for electricity that is returned, to prevent overloading the grid as much as possible.
The netting scheme is immensely popular for many consumers who own their own home. Earlier this month, the Senate blocked the proposal by outgoing Minister Rob Jetten (Energy, D66) to phase out the scheme – to the disappointment of energy suppliers. “We are finding it increasingly difficult to match energy supply and demand,” says a Vattenfall spokesperson. And now that the netting arrangement will be maintained, this will not decrease. “As long as customers can make net payments, this problem will only increase in the future, because the number of solar panels will increase.”
‘Distribute more fairly
The additional costs are borne by the owners of solar panels, but must be paid by all customers. Also by those who do not have solar panels. “They now contribute disproportionately to covering those costs,” says an Essent spokesperson. “We would like to distribute these increasing costs more fairly among our customers so that the rates for all customers can be reduced.”
There are several options for energy companies to better distribute costs among customers. For example, the companies Vrijopnaam, Budget Energie and Vandebron charge feed-in costs to customers with solar panels who use the netting scheme. It is also possible to charge a rate per solar panel. Greenchoice says it has not opted for this now, but leaves open the possibility of doing so in the future.
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In addition to Greenchoice, other major energy suppliers are also looking at these types of measures. For example, Essent is working on a way to better distribute the return costs. At Vattenfall, too, “all options are on the table”, says a spokesperson. Eneco customers can expect to receive an information letter in the near future. When the abolition of the netting scheme failed in the Senate, Eneco announced that it would work on a more fair distribution of costs for customers. A spokesperson for the largest energy supplier in the Netherlands does not want to say when the measure will be announced and what it will entail.
The fact that Greenchoice’s goal is highly symbolic is evident from the minimal difference in the electricity bill. According to the new rates, the off-peak and normal rates are closer to each other. Where it used to be 4 cents per kilowatt hour cheaper to turn on the dryer at night, that price difference now becomes 1 cent. If you don’t have a fairground attraction in your backyard, behavioral change will cost you at most a few euros per month cheaper.