The Netherlands is rapidly advancing its energy transition but how do we keep the energy system reliable and affordable? In the Engie Transition Podcast, Hans van Cleef (energy economist at Eqolibrium) and Harry Talen (CEO of Engie) discuss security of energy supply and the urgency of making decisions now.
The discussion is prompted by the report Control the Controllable, which shows that electricity demand could increase significantly in the coming years due to further electrification, such as electric vehicles, heat pumps and data centres. At the same time, the share of wind and solar energy continues to grow, making the system more dependent on flexibility and back-up during periods when the wind does not blow and the sun does not shine.
"The Netherlands can no longer assume that a reliable electricity supply will always be available." – Hans van Cleef
Without additional measures, the Dutch energy system is expected to become increasingly reliant on a mix of imports, battery storage and demand response. Solutions that are not always available or are mainly suited for short-term balancing.
The report therefore calls for the introduction of a capacity mechanism: an “insurance premium” that ensures sufficient controllable capacity remains available, reducing the risk of disruptions and extreme price peaks. Many European countries already work with such mechanisms; the Netherlands is now at a crossroads. The choices made today will determine whether security of supply remains self-evident in the future.
Watch the full podcast episode and the discussion on security of supply here.