The Dutch government is preparing to transition its support framework for onshore renewable energy to a two-way Contracts for Difference (CfD) system, replacing the existing SDE++ subsidy scheme. The change comes in response to new European Union rules on electricity market design.
In a letter to parliament, Dutch Minister for Climate and Green Growth Sophie Hermans said a legislative proposal for the policy overhaul will be presented this summer.
“The new system is aimed at providing price certainty for developers and promoting efficient electricity production, while also addressing grid congestion and paving the way for a future in which renewable energy can be developed without government support,” Hermans wrote.
The current SDE++ scheme provides operating subsidies for technologies such as onshore wind and solar PV that contribute to carbon emission reductions. Under the revised EU regulations, from mid-July 2027, member states may only offer operational support for onshore wind and solar through two-sided CfDs, which require developers to pay back excess profits when market prices rise above a set strike price.
According to Hermans, the draft legislation will be submitted to the Council of State before the end of 2025, with parliamentary review expected in early 2026.
The planned CfD framework is part of a broader effort to align national support mechanisms with evolving EU energy market rules while ensuring the continued growth of renewable electricity generation in the Netherlands.
