EXPRESS #2 - July 3, 2018
Dutch parliament sets target of 95% CO2 reduction
The Netherlands has long been a laggard in the EU in climate policy (especially in renewable energy), but recently it has been showing a lot of climate ambition.
Last year, a new centre-right coalition government surprised friends and enemies alike with an accord that included a 49% CO2 emission reduction by 2030 (more than the 40% EU member states agreed on after Paris) as well as closure of all coal power stations by 2030. It also included a carbon price floor of €18/ton starting in 2020, rising to €40/ton in 2030.
Now, a cross-party coalition of 7 parties in Parliament, representing 75%, have said they will agree on a law requiring the Netherlands to cut greenhouse gas emissions by 95 percent by 2050, compared with the level in 1990.
The law also targets a 49 percent reduction in emissions by 2030, and requires the electricity supply to become carbon neutral by 2050, reports Reuters.
The proposed bill, expected to come into effect next year, did not give an estimate for the cost of reaching the goals, nor an indication of how they might be achieved, Reuters adds.
“Politicians can’t deny climate change,” said Jesse Klaver, leader of the environmentalist Green Left party, at the presentation of the draft bill. “This makes clear which targets we should meet,” Socialist Party leader Lilian Marijnissen added. “These can no longer be discussed.”
“The ministry of Economic Affairs has asked all sectors involved in the reduction of greenhouse gasses to come up with plans to meet the climate goals in the coming weeks”, notes Reuters. “But progress has reportedly stalled as large industrial companies fear they will become less competitive if the Dutch want to take on climate change faster than other European countries. Industry is responsible for a quarter of the total CO2 emissions in the Netherlands, with 12 large companies responsible for 75 percent of that amount.”
The change in Dutch climate policy is partially related to the problems of the Dutch gas sector, long a mainstay of national energy policy, which held back more ambitious renewable energy targets. The government announced in March that it will end production from the giant Groningen field by the end of the next decade, in an effort to stop a string of relatively small, but damaging earthquakes caused by gas extraction.
On 25 June, the government announced it had made a deal with Shell and ExxonMobil, the two partners in gas production company NAM, which operates the field. The companies will not submit a claim for missed revenue due to the Dutch government’s decision to halt gas production, reports Reuters.
“A lot of gas will be left in the ground,” Economy minister Eric Wiebes said at the presentation of his deal with the oil majors responsible for extracting Groningen gas. “That gas is the property of the oil companies, but they will not submit a claim and the government is not required to compensate them.”
Some 450 billion cubic meters (bcm) of gas will be left in the ground, Wiebes said, with an estimated value of approximately 70 billion euros.
NAM will be required to pump as much gas as the government says is needed in the coming years. In return, it will see its share of the revenue from Groningen rise from 10 to 27 percent, Wiebes said, starting this year.
As part of the deal, NAM will also contribute a total of 500 million euros to strengthen the economy in the Groningen region, with the government another 500 million.