The mid-2000s when a different feed-in subsidy
The enthusiasm and excitement around the promise of new Dutch pellet demand is easy to understand. Pellet producers see the new policy discussions as a way to rekindle demand initially created in the mid-2000s when a different feed-in subsidy, the MEP premium, was passed and implemented. The program was closed in 2006 and the contracts that it created have expired or will in 2015.
The Netherlands is also well positioned from an infrastructure perspective. The country serves as an important trade hub for Western Europe, bolstered by the region’s largest and busiest ports. The port of Rotterdam is a massive complex covering over 46 square miles that remains Europe's busiest port. The port is connected to an impressive system of rivers and waterways that can be leveraged to deliver pellets efficiently by barge. Finally, because of the now-shuttered MEP program, co-firing with wood pellets has an antecedent in the Netherlands. RWE/Essent’s Amer power plant is one example of a large coal station with deep experience in co-firing biomass. The facility began co-firing with biomass in earnest in 2001, ultimately growing its annual consumption to nearly 800,000 tons by 2010. The successful deployment of biomass co-firing at Amer serves as a strong proof of concept for the owner’s of the country’s other coal assets.
All together, there are seven coal stations in the Netherlands with a total capacity of nearly 7,000 MW. According to Peter-Paul Schouwenberg, Manager Environment-Regulatory Affairs at RWE, the NGO’s that are participating in the policy formation are generally opposed to coal stations, and are willing to entertain biomass co-firing only because of the strategy's ability to reduce CO2 emissions. Additionally, NGOs, energy companies, and Dutch policy makers all believe that robust sustainability criteria must be followed.