News » 30.04.2025 - Dutch government decision angers growers
Last week's leaked information has now been confirmed: the Dutch government will include the greenhouse horticulture sector in the new EU Emissions Trading System (ETS-2) and introduce a mandatory blending requirement for green gas. Although the government plans to compensate the sector for these added costs, it remains uncertain whether the European Commission will approve the subsidies. The Dutch greenhouse growers' association (Glastuinbouw Nederland) has already expressed concern, indicating little confidence in the proposed measures.
Green gas
The obligation to blend green gas into the gas supply is expected to lead to increased costs for greenhouse growers. Studies show that the additional costs could amount to as much as 10%. By 2030, gas prices for the sector could rise by € 0,04 to 0,12 per cubic meter.
To soften the impact, the government will lower the green gas blending requirement by 25% and delay its implementation until 2027. Compensation will only proceed if it complies with EU state aid rules and fits within the national Recovery and Resilience Plan. Additionally, €200 million from the Climate Fund will be made available to support the sector in transitioning to sustainable alternatives like district heating and affordable electricity. This support package will be further developed in collaboration with the sector and officially presented on the Dutch Budget Day (September 16) in 2025.
ETS-2 inclusion
Also in 2027, the entire horticultural sector will be included in the EU's expanded carbon trading system, ETS-2. Currently, only a few of the Netherlands' largest growers are part of it. The government argues that excluding the sector from ETS-2 is not an option. As a result, the existing Dutch CO₂ levy for greenhouse horticulture will be replaced by participation in ETS-2. The sector will receive financial compensation equivalent to the CO₂ price required to meet its 2030 residual emissions target of 4.3 million tons - estimated at €42.50 per ton of CO₂ (a final figure will be calculated in August).
There is one exception: for existing projects under the Dutch renewable energy subsidy scheme (SDE), no adjustments will be made for the introduction of ETS-2, since companies had already factored this into their original subsidy applications.
Dissatisfaction
These additional measures have been met with discontent from the horticultural sector. Glastuinbouw Nederland had previously lobbied against these decisions, but their efforts were unsuccessful. Alexander Formsma, Energy & Climate Policy Specialist at Glastuinbouw Nederland, stated in a press release that the measures severely undermine the sector's viability and capacity for innovation. The organization criticizes the government's unilateral decision, which they argue contradicts the energy agreement and a widely supported parliamentary motion that called for the sector to be included in ETS-2 only with the consent of all parties involved in the agreement.
For the past decade, the horticultural sector has operated under its own CO₂ emissions system, which was established in a 2012 agreement with the government to meet climate goals for 2030 and achieve climate neutrality by 2040. Despite being one of the first sectors in Europe to pay for its emissions, the sector now faces increasing challenges in becoming more sustainable due to grid congestion, nitrogen issues, and slow permitting processes. While Glastuinbouw Nederland welcomes the government's intention to allocate an additional €200 million to assist growers in this transition, they note that this support is still in its early stages, whereas the government is already imposing additional costs.
The sector's climate ambitions were already supported by an annual increase in the CO₂ levy. This year, the sector also faces a significantly higher energy tax due to the Climate Tax Measures Act, passed in late 2023. The government acknowledges that these measures provide sufficient incentives to become more sustainable, as confirmed by a report on Budget Day.
Glastuinbouw Nederland says Dutch horticulture doesn't need any new regulations to meet the CO2-goal, they made an agreement with the Dutch government. The new measures are, again, raising the energy costs for growers.
Formsma says: "Despite it not being necessary to achieve the climate ambition, the cabinet is opting for even higher energy costs in the sector with ETS-2 and the blending obligation."
Concerns about state aid
Formsma points out that the government's plan to cover these extra costs is complicated. It's unclear if the EU will approve this financial help since the industry is trying to reduce reliance on fossil fuel subsidies. The government's plan seems insufficient, leading to concerns about whether businesses will get compensated for these extra energy costs on time and in full.
Questioning the value of the agreement
Glastuinbouw Nederland has communicated its objections to the government regarding the proposed decision. In line with the energy agreement, the sector hopes to work with the government to develop a new plan that avoids excessive pricing and provides growers with actionable options. If these concerns are not adequately addressed by September 16, Glastuinbouw Nederland may reconsider the terms of the agreement.
Nitrogen issues
LTO Nederland, an agricultural organization, has also commented on the government's plans, focusing particularly on the government's aims to remove nitrogen restrictions in the Netherlands. LTO Chairman Ger Koopmans mentioned that reducing nitrogen emissions by 40% will be a big challenge for the agriculture and horticulture sectors. They are ready to tackle this challenge, but only if the necessary legal changes are made and approved by both legislative chambers this year. According to Koopmans, as the law stands now, reducing emissions doesn't provide any practical benefits for farmers and growers.
Source:www.floraldaily.com
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