On 18 April 2024, the Netherlands Authority for Consumers and Markets (ACM) presented several code decisions. This involves a broad package of measures to improve congestion management and guarantee connection times, among other things. NedZero is pleased with the code decision for the connection periods.
“NedZero is pleased with the excellent cooperation within which the code decision for the connection periods has been developed. It offers certainty for parties that want a new connection and also breathing space for grid operators to realize the large number of requested connections. The intention is that the initially longer period will be gradually reduced again.”
Cause
Grid congestion occurs when consumers demand more electricity transport than the power grid can handle, for example through the use of heat pumps, solar panels and charging electric vehicles. The Netherlands is currently becoming more sustainable at a record pace and fossil fuels are making way for sustainable electricity. However, demand is growing faster than grid operators can strengthen and expand the grid.
ACM makes it possible for grid operators to move away from the 'first come, first served principle' in some cases, whereby requests must be processed in order of receipt. Grid operators endorse the aim of offering transport capacity to some applicants with priority. This includes services that reduce congestion, security services and schools.
Process
The connection terms are included in the Electricity Act. However, the case law of the Court of Justice of the EU shows that these periods may not be laid down in law, but must be determined by the ACM.
In anticipation of the measures presented, ACM has determined the deadlines in a draft decision following a market consultation. In addition to NedZero, consultations have been held about this with the market parties: the trade association for energy and water (VEMW) , Holland Solar , Energie Samen , Energie-Nederland , Bouwend Nederland and the Dutch Association of Sustainable Energy (NVDE) . The grid operators participated: Liander , Stedin , Enexis and Westland Infra .
In the market consultation, ACM presented three specific questions to which parties could respond:
- The desirability of exceptions to the deadlines when realizing large numbers of small connections in new residential areas.
- The nature and scope of information that customers would have to provide when applying for a connection.
- Situations of force majeure, for example due to unforeseen situations in a permit procedure.
Balancing interests
When establishing the code, in accordance with Article 31 of the Energy Act, ACM must take the interests of the network operators and connected parties into account. The interests of the network operators are that they must be given a reasonable period to carry out the statutory task of providing the connection. Grid operators must respond to a sharp increase in electrification and sustainable production of electricity and are therefore affected by personnel shortages and extended deadlines in (municipal and provincial) permit procedures.
The interest of the connected parties is to obtain a ready-to-use connection to the grid within a reasonable period. Connected parties suffer when network operators take (too) long to realize connections. This slows down the delivery of projects – and thus the initiation of (new) activities in society and the economy – and slows down the progress of the energy transition. Connected parties need certainty and clarity about the time it will take the grid operator to realize their connection. In practice, they experience that it is difficult to make firm agreements with grid operators about the delivery date of the connection.
Decision
The ACM notes that the network operators and customer interest groups have jointly arrived at a design for the connection periods that both groups consider reasonable. The ACM therefore concludes that the interests of grid operators and customers have been sufficiently taken into account.
In the proposal published by ACM, a clear framework has been created that provides guidance to both applicants for transport capacity and grid operators in answering the question of who should be given priority in the application.
Parties that fall into a category in the prioritization framework do not automatically receive priority. To do this, they must first provide supporting documents to demonstrate that they meet various requirements. Network operators will apply the framework in congestion areas from October 1.
The new code decision includes several deadlines. This does justice to the complexity of the process, the increased demand for connections and the shortage of personnel to realize these. This provides more clarity for applicants, applicants are given a realistic deadline and network operators have more options to carry out the work in a more systematic manner.
Connection terms for large-scale consumption
ACM also publishes the code decision on connection terms for large connections. The code is based on the proposal that the regional network operators and market parties have jointly drawn up and agreed with the ACM.
The code decision published by the ACM contains several deadlines. These terms do justice to the complexity of the process, the increased demand for connections and the shortage of personnel to realize them. The new proposed working method provides more clarity for applicants, offers applicants a realistic deadline and gives network operators more options to do the work in a more systematic manner.
Congestion management research
In many cases, anyone who applies for a new connection will be placed on a waiting list. In congestion areas, grid operators must first know how much space and especially how much flexible space is left. To find out, network operators conduct congestion management studies. ACM has also published what they think is an appropriate period for these investigations.
ACM states that in the case of a request for a connection to purchase electricity, the maximum period for an investigation may be twelve months. And for infeed, that period is six months. Grid operators look for flexibility. They do this with current affiliates and with parties that are currently on the waiting list. This is an intensive and time-consuming process. Twelve months for the purchase of power seems a reasonable period. Network operators are concerned about the six-month period in the case of feed-in.
The code decision has been published in the Government Gazette .
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