Electricity imports at record level

In May and June 2012, electricity imports in the Netherlands were higher than ever. At the same time production at gas-fired electricity plants was at its lowest level of the last ten years.

Electricity imports and exports

Increase in imports started unexpectedly

Imports of electricity reached an unprecedented level in March 2012. This was quite unexpected, as imports had been falling sharply and exports rising, especially towards the end of 2009 and at the beginning of 2010. In this period, the Netherlands was a net electricity exporter. Imports started to rise again from the beginning of 2011, and in May 2012 they reached their highest level ever. Imports from Germany and Norway in particular are up.

Natural gas too expensive

The cause of the rise in imports is to be found in developments of energy prices. The price of natural gas rose strongly in 2011 and 2012, the price of coal rose in 2011, but started to fall at the start of 2012. The price of electricity remained stable, however, as the supply of cheap electricity in countries nearby rose relatively strongly. In Norway a surplus of hydro-powered electricity was available in the first half of 2012 as a result of the large volumes of precipitation there. And in Germany electricity was available from lignite and coal and the volume of solar-powered electricity also rose. As a result of subsidies, solar power is relatively cheap.

This led to the situation where producing electricity from natural gas often cost more than buying it in from Norway and Germany.

Producer prices of electricity, natural gas and coal

Lower production in gas-fired plants

Some 60 percent of electricity produced in the Netherlands is generated from natural gas. In neighbouring countries natural gas is used much less for power production. Germany mainly uses coal and lignite, and Norway has mostly hydro-powered plants.
The higher imports of electricity were accompanied by lower generation by gas-fired plants. From March to June 2012, the smallest amounts of natural gas were used to generate electricity since 2001.

Input of natural gas and coal in electricity production plants

Otto Swertz and Jan Kloots