News » 28.11.2025 - NL: CHP remains important as energy costs rise sharply due to new policy
The importance of the gas-engine combined heat and power unit (CHP) in Dutch horticulture will remain strong in 2025, even as energy costs continue to rise and tax benefits are gradually phased out. According to S. Schlatmann and J. Larrivee of BlueTerra, who shared their findings with Glastuinbouw Nederland in an autumn update of the CHP Barometer, CHP systems still offer a competitive advantage compared with producing heat with a boiler and purchasing electricity separately.
This advantage exists mainly because growers are facing steep increases in energy costs. The lower energy tariff for horticulture is being phased out, the natural gas exemption is shrinking, and a CO₂ levy has been added. From 2027 onward, new policies such as ETS-2 and mandatory green gas blending will put more financial pressure on greenhouse companies. Uncertainty around possible compensation schemes adds even more risk for growers.
Supply security under pressure
Grid operator TenneT warns that from 2033 onward, the reliability standard for electricity supply may no longer be met. As coal-fired power plants are phased out and other fossil-based capacity declines, the system becomes increasingly dependent on flexible sources such as CHP units. At the same time, the share of renewable energy keeps growing, which leads to stronger price fluctuations and a greater need for controllable capacity. If market or policy conditions make CHP operation significantly less profitable, total CHP capacity will drop, and this would further weaken supply security.
CHP Barometer: shifting usage patterns and operating hours
Growers are increasingly operating their CHP units during hours when electricity prices are high. This usually happens in the morning, evening, overnight, and on weekends. When solar and wind production is low, CHP remains an important source for keeping the power grid stable.
Looking ahead to 2030, the approach to heat supply is expected to move toward a mix of CHP and heat pumps. CHP units will mainly cover peak demand, while heat pumps will take over during hours with low electricity prices.
Profitability 2028-2033: challenges and opportunities
2028: The profitability of CHP units that supply electricity to the grid remains strong, even with rising natural gas prices. Heat produced by boilers becomes more expensive at a faster rate than heat produced by CHP systems, which keeps CHP attractive. At the same time, the role of CHP in the electricity network continues to grow because the demand for emergency and balancing capacity is increasing.
By 2030, the number of full-load hours for grid-supplying CHP units drops further, falling below roughly 2,500 to 3,000 hours. As wind and solar generation expand, CHP operation shifts toward less predictable hours, making it more difficult for growers to make optimal use of the heat and CO₂ produced during those times.
2033: Competition from heat pumps and other renewable technologies becomes more pronounced. In 2033, full-load hours are expected to fall to around 2,000 to 2,200. Higher energy taxes, rising grid fees and additional charges on natural-gas consumption push electricity costs upward. This raises an important question for growers: will plant lighting remain affordable in the future, or will operations increasingly switch to more flexible lighting strategies, or possibly even no lighting at all?
Policy and uncertainties
Because of the current uncertainties, this edition of the CHP Barometer does not include calculations based on the proposed policies or their possible compensation schemes. The horticulture sector is waiting for more clarity about how these policies will ultimately be shaped and what their impact will be.
CHP remains important
Combined heat and power will continue to play a major role in horticulture for at least the next ten years. Profitability is under pressure because of rising taxes and new policy measures. For growers, this means sharply increasing energy costs and a growing need to invest in flexibility and more sustainable alternatives.
Financing and coordination
This project was carried out by BlueTerra. It was financed and coordinated by Kas als Energiebron, an innovation programme of the Ministry of LVVN and Glastuinbouw Nederland. The project was also made possible with support from Kennis in je Kas, or KiJK.
Source: www.floraldaily.com
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