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Net metering in the Netherlands

The current situation and the changes after 2023: what you need to know

Net metering in the Netherlands

How does it work and what will change from 2023?
One of the reasons why solar panels are such an attractive investment, lies in the regulation on net metering, known as ‘salderingsregeling’ in Dutch. The law on net metering states that the power companies are obligated to deduct all the power that a household feeds back into the grid, from the amount of power that it consumes from the grid. That means you only end up paying for the resulting balance between the two. In theory, if your solar panels produced exactly as much energy in a year as your household consumes, you would be able to eliminate the electricity consumption part of your energy bill to zero.

Why choose Zonnefabriek for your solar panels?

  • We always do free, zero-strings-attached house visits before every install
  • We work both with our own installers as well as with long-standing partners and adhere to all applicable quality standards
  • We have a separate service department with its own teams that can come on-site to fix any issues
  • We only work with top quality products that are durable and sustainable
  • Our solar panels have the longest and most comprehensive warranties on the market
  • This has led to our solar installations producing on average 10% more energy than other systems in the Netherlands..
  • ..which leads to high yields and happy customers!

Phasing out from 2023

The net metering law has been very successful in making solar panels a popular investment. But the current regulation is set to change from the year 2023. The reason behind this change is that the government is losing out on tax paid over electricity: after all, a household without solar panels pays (a.o.) VAT over every kWh consumed, whereas a household with solar panels can end up paying a lot less VAT on the electricity it consumes, because of the net metering law.

That’s why the government has decided to slowly phase out the current net metering law in stages, decreasing the percentage of energy that is subject to net metering by 9% per year from the year 2023 onward. In the final stage, net metering will be phased out completely from 2031.

How is it going to work?

At this moment in time and for the next years up to and including 2022, nothing changes: all the power you feed back into the grid will be deducted, kWh for kWh, from the amount of energy you consume.

In the year 2023, the percentage of energy that is subject to net metering will fall from 100% to 91%, as is shown in the graph below. That means that 91% of all the electricity you feed back into the grid, will be deducted from the energy you consume. However, that doesn’t mean that the remaining 9% is worthless: you will still get some compensation for that amount, albeit not at the same price level as of the electricity you consume. The government has decided that there will be a minimum price that a household must receive for power fed back to the grid, and has labeled this minimum price the ‘reasonable compensation’ (or redelijke vergoeding in Dutch). We don’t yet know exactly how much the ‘reasonable compensation’ will be, but in the proposals it is suggested it should be no less than 80% of the basic cost of electricity (excluding all taxes and surcharges).

Phasing out of net metering: the percentage of electricity that is subject to net metering until 2031

Phasing out of net metering: the percentage of electricity that is subject to net metering until 2031

If you want to make a calculation of the financial yield of your system over the coming years, you have to make a few assumptions: what is the average price of electricity going to be, how high will the ‘reasonable compensation’ be, and, importantly, what share of the energy produced by your solar panels will you be consuming directly without feeding it back into the grid, in other words: what percentage will your self-consumption be?

In the table below you can see what the financial yield would be for a solar system if we assume an average all-included electricity price of 25 cents per kWh (the current price level is about 21 cent per kWh), a ‘reasonable compensation’ of 7 cents per kWh, and a percentage of self-consumption of 25%. This last number means that 25% of the power produced by the solar panels is consumed in the household, whereas the remaining 75% is fed into the grid. The self-consumption percentage is higher for households with a relatively high power consumption and a relatively small solar system, and for households where the members spend a lot of time at home during the day, as opposed to going out to work or school. In this example the solar panels produces about 4000 kWh of clean energy per year

Year

Percentage subject to net metering

Yield from self-consumption

Yield from net metering

Yield from non-net metering component 

Total yield

 

 

= 1000 kWh x 25 cents

= 3000 kWh x percentage net metering x 25 cents

= 3000 kWh x left over percentage  x 7 cents

 

2020

100%

€250.00

€750.00

€0.00

€1000.00

2021

100%

€250.00

€750.00

€0.00

€1000.00

2022

100%

€250.00

€750.00

€0.00

€1000.00

2023

91%

€250.00

€682.50

€18.90

€951.40

2024

82%

€250.00

€615.00

€37.80

€902.80

2025

73%

€250.00

€547.50

€56.70

€854.20

2026

64%

€250.00

€480.00

€75.60

€805.60

2027

55%

€250.00

€412.50

€94.50

€757.00

2028

46%

€250.00

€345.00

€113.50

€708.40

2029

37%

€250.00

€277.50

€132.30

€659.80

2030

28%

€250.00

€210.00

€151.20

€611.20

2031

0%

€250.00

€0.00

€210.00

€460.00

 

 

 

 

 

 

 

 

 

 

Total

€9,710.40

As you can see from the calculation, the financial yield is still quite considerable and still makes an investment in solar panels well worthwhile.

But what would happen if this particular household managed to increase its self-consumption from 25% to 50%? The table below gives the calculations for each year.

Year

Percentage subject to net metering

Yield from self-consumption

Yield from net metering

Yield from non-net metering component 

Total yield

 

 

= 2000 kWh x 25 cents

= 2000 kWh x percentage net metering x 25 cents

= 2000 kWh x left over percentage  x 7 cents

 

2020

100%

€500.00

€500.00

€0.00

€1000.00

2021

100%

€500.00

€500.00

€0.00

€1000.00

2022

100%

€500.00

€500.00

€0.00

€1000.00

2023

91%

€500.00

€455.00

€12.60

€967.60

2024

82%

€500.00

€410.00

€25.20

€935.20

2025

73%

€500.00

€365.00

€37.80

€902.80

2026

64%

€500.00

€320.00

€50.40

€870.40

2027

55%

€500.00

€275.00

€63.00

€838.00

2028

46%

€500.00

€230.00

€75.60

€805.60

2029

37%

€500.00

€185.00

€88.20

€773.20

2030

28%

€500.00

€140.00

€100.80

€740.80

2031

0%

€500.00

€0.00

€140.00

€640.00

 

 

 

 

 

 

 

 

 

 

Total

€10,473.60

In this case, the total financial yield amounts to € 10.473,= , which means you can earn € 763 more in the years up to 2031 if you manage to increase the self-consumption from 25% to 50%, and € 180 more per year for each year from then on.

What does this mean for you?

The main thing you need to know is that the net metering system is going to change and that this will affect the return on investment of your solar panels, but that your savings will still be considerable. And secondly, the more you manage to increase your share of self-consumption, the more you earn.

How can you increase your self-consumption?

Increasing self-consumption firstly comes down to switching on appliances like dishwashers and washing machines when the sun shines: that’s the easiest way. You can do this manually, but you can also get a smart energy manager installed that can manage your household appliances for you: for those households with SMA inverters installed, the Sunny Home Manager is the instrument of choice.

Other ways of increasing the share of self-consumption include storing power in batteries, or turning it into hot water that can be stored in your boiler. And those of us with electric vehicles may consider a smart car charger that uses as much solar power as possible to charge the car. All of these options can be controlled by the SMA Sunny Home Manager. For those households that have a SolarEdge inverter, a SolarEdge Modbus meter would need to be installed.

Zonnefabriek can help you make the best use of your solar panels by increasing your self-consumption. Drop us a line and we’ll be happy to discuss your options with you.