It sounds like a potential victory for the climate: the four remaining coal-fired power plants in the Netherlands will not close in 2030, as is currently the plan, but already in 2025. GroenLinks advocates such an early closure. Party leader Jesse Klaver states that the cabinet is not achieving its own climate goals, and that the Netherlands is ‘deliberately busy’ by keeping coal-fired power plants open ‘to destroy the climate’. Environmental organizations have already called for this in the past. Does the early closure of coal-fired power plants indeed have the intended climate effects?
First the climate. Exactly how much profit does closing the power stations earlier make? Last year, research institute CE Delft conducted research into such an early coal stop from 2025, commissioned by environmental organization Natuur & Milieu. It resulted in a saving of between 17 and 33 megatons of CO2 over the five years, equivalent to regarding 2 to 4 percent of all Dutch emissions per year.
That is significant, but there is a caveat. The climate benefit has been calculated by replacing the lost coal flow with natural gas flow. Gas has been scarce in Ukraine since the war, and Klaver also says that the Netherlands will have to import LNG, for example from the Middle East. Liquefied gas is cleaner than coal, says energy analyst Jilles van den Beukel of The Hague Institute for Strategic Studies, but a lot less clean than gas from Groningen or the North Sea. “Especially in shale gas extraction in the United States, a lot of methane is released during its extraction.” Van den Beukel estimates that in terms of emissions, LNG is somewhere between relatively clean natural gas and coal. Cleaner than coal, but closing early would not yield as much climate benefit as GroenLinks and environmental organizations hope.
European regulated
In addition, the question is what the closure of the Dutch coal-fired power plants means for the climate in concrete terms, says professor of energy economics Machiel Mulder (University of Groningen). The permitted emissions of greenhouse gases in the energy sector are regulated at European level, within the emissions trading system (ETS). If you want to emit greenhouse gas, you have to buy emission allowances. Every year there are fewer and they become more expensive every year, which encourages companies to save or to become more sustainable. “If the Dutch coal-fired power stations close in 2025 and do not buy emission rights, parties elsewhere in Europe will buy them, for example a coal-fired power station in Eastern Europe.” Thanks to this ‘waterbed effect’, the emissions no longer come from the Netherlands, but are also released into the air, which is just as bad for the climate.
The Netherlands can choose not to sell its emission rights for coal-fired power plants, which means it will miss out on income. Mulder estimates this at regarding 375 million euros with current CO2 prices, but that price might actually be higher due to rising prices. The question is whether the Netherlands would actually do this.
Damage claims
Another risk. When the Netherlands announced in 2019 that it would stop burning coal in 2030, energy companies RWE and Uniper demanded 2.4 billion euros in damages due to lost future profits due to new government policy. The court ruled that the Netherlands does not have to pay for this, partly because the coal freeze had been carefully worked out and announced well in advance. If government policy suddenly changes and the power stations have to close in 2025, this might once more lead to claims for damages, which might turn out differently, thinks jurist and political scientist Sanne Akerboom (Utrecht University).
After all, companies would have only two years to prepare, and the government would be fickle in its policy. A spokesperson for RWE does not comment on possible claims for damages. But claim for damages or not, it is obvious that the Netherlands will have to pay at least some form of compensation for the closure. Professor of Energy Transition Jan Rotmans (Erasmus University Rotterdam) estimates that compensation to be in the order of hundreds of millions. The Ministry of Economic Affairs and Climate is more likely to think of ‘billions.’ Akerboom: “That would be frustrating, because you can also use such financial resources for sustainable energy.”
VVD: Proposal is completely irresponsible
VVD MP Silvio Erkens calls the GroenLinks proposal to close coal-fired power stations by 2025 “completely irresponsible”. According to Erkens, closing the power stations would increase the energy crisis and thus also increase energy poverty.
The VVD member also fears that the climate will not benefit on balance if the Netherlands stops coal power earlier. Electricity that the Netherlands needs more than it generates itself must then come from abroad. According to Erkens, this might lead to the German lignite power stations running faster. Lignite is even worse for the climate than the coal that Dutch power stations burn. Erkens also uses GroenLinks’ plea to put a VVD wish in the spotlight once once more. According to him, the coal-fired power plants can close in 2030, because new nuclear power plants have to be built in the following years.
Klaver’s plan is of course supported by the PvdA, with which GroenLinks collaborates intensively. According to PvdA Member of Parliament Joris Thijssen, the coal-fired power stations must be closed as soon as possible. The PvdA advocates a ‘work guarantee fund’ for employees. Through this fund they should work in a ‘green’ job, while retaining their income.
Niels Markus
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