Netherlands Renewable Energy Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The market for renewable energy in the Netherlands is expected to register a CAGR of approximately 7.34% during the forecast period of 2022 - 2027. The COVID-19 pandemic has not had any major negative impact on the market, as the country witnessed growth in renewable energy installed capacity in 2020. However, projects like the Fryslan wind energy project were delayed by a quarter in 2020. Factors such as increasing renewable energy generation, reducing dependence upon fossil fuels, rising environmental awareness, and the government’s push toward following the Paris climate accord are expected to boost the demand in the Dutch renewable energy market. However, technological and cost constraints in the renewable energy market are impeding the growth of the market.

Key Highlights

• Till 2020, solar energy dominated the renewable energy market, with around 57.7% share of the installed renewable energy capacity. This is expected to change considerably during the forecast period, with wind energy taking a large share of renewable energy and becoming the largest in the segment. This growth can be attributed to the private players' involvement in trying to increase wind energy profits.
• The prices of renewable energy are decreasing steadily and, in some places, out-competing the national average price per kilowatt. As the prices fall further, renewable energy is expected to sustain without governmental subsidies, thereby forming an opportunity for the companies to grow further in the sector.
• Renewable energy generation has been increasing steadily in the country, with a significant increase in the amount of solar energy being produced in the country.

Key Market Trends

Wind Energy is Expected to Witness Significant Growth

• Under the Paris Climate Agreement, 70% of the Dutch electricity needs, that is, a total of at least 84 terawatt-hours (TWh), must be generated sustainably (solar or wind power) by 2030. More than half (49 TWh) is expected to be generated by offshore wind farms, while the other 35 TWh is likely to come from onshore wind farms and onshore solar power plants.
• In 2020, the growth in the wind energy installed capacity was 47%. The installed capacity increased from 4484 MW in 2019 to 6600 MW in 2020.
• By 2030, 70% of the current electricity consumption of the country is expected to come from wind or solar energy. That equates to 84 terawatt-hours (TWh). More than half of this will come from offshore wind energy (49 TWh). The remaining 35 TWh comes from wind and solar energy on land.
• Additionally, an effective offshore wind policy framework in the country is driving rapid deployment and aims for 49 TWh of generation by 2030.
• Vattenfall (a wind energy company) is expected to construct and operate its second unsubsidized wind farm in the Dutch North Sea. After its completion in 2023, the wind farm is expected to generate around 760 MW of electricity, which is enough to provide for 2.5% of the country’s electricity needs. Vattenfall also received the permit to build subsidized wind farm sites in the country in 2018.
• Hence, with increasing investments in the wind energy sector and favorable government policies, the industry is expected to witness a significant surge during the forecast period.

Government Initiatives May Drive the Market

• The solar energy generation in the country increased by 52.8%, from 5.3 terawatt-hours in 2019 to 8.1 terawatt-hours in 2020.
• The country is actively trying to drive its wind power sector to meet its goals set under the Dutch Climate Agreement announced in June 2019. Under the agreement, the Netherlands aims to cut CO2 emissions by 49% by 2030, a significant increase over its 2020 goal of 25%. ​
• The agreement also fixes volumes for the expansion of wind energy to 2030: 7.5-8.5 GW of onshore and 11.5 GW of offshore wind. It sees renewables providing 75% of electricity in the Netherlands by 2030.​
• There is strong government support for the further development of the wind and solar power sectors in the country, including a positive regulatory system, ambitious targets for capacity, and incentives to encourage investment in the sector. ​
• Hence, the Dutch renewable energy market is expected to grow significantly during the forecast period due to an increase in environmental awareness, upcoming projects, and a push to reduce dependence on fossil fuels that are mostly imported from other countries.

Competitive Landscape

The Netherlands renewable energy market is partially fragmented. Some of the major players include Vattenfall AB, Zhejiang Chint Electrics Co. Ltd, Sunstroom Engineering BV, Siemens AG, and DMEGC Solar Energy.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

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