Heat pump owners face higher costs under new power grid pricing
A planned overhaul of Dutch electricity grid fees could sharply raise heating costs for households using heat pumps, with industry groups warning the changes may undermine the government’s push to move homes off natural gas, Trouw reports.
Under the proposal, households would no longer pay only a largely fixed annual grid fee beginning in 2029. Instead, part of the cost would become variable, with higher charges during peak demand hours, in winter months, and for households with heavier electricity use.
The Dutch government and grid operators say the changes are needed to reduce congestion on the overloaded electricity network. But the system could make heat pumps significantly more expensive to operate because they consume the most electricity during colder months and evening peak periods.
The Dutch Heat Pump Association said it has “major concerns” about the impact. Chairman Frank Agterberg said households considering a heat pump could soon face “perhaps even a doubling” of electricity prices during expensive time blocks. The association is studying how much the new system could worsen payback periods for heat pump investments.
Independent energy consultant Jos Dings, who raised concerns about the issue on social media, told Trouw that the payback period for both hybrid and fully electric heat pumps could increase to more than 10 years, up from about 7 to 8 years currently. He stated that this situation conflicts with the government's plans to phase out natural gas heating and to require hybrid heat pumps starting in 2029.
Dutch households currently pay mostly uniform annual grid fees. Customers of grid operator Enexis, for example, pay about 475 euros per year. Consulting firm Berenschot estimates the amount will rise to about 558 euros annually by 2029 due to major grid expansion costs.
To ease pressure on the network, operators want consumers to shift electricity use away from busy periods. National grid operator TenneT already introduced a variable grid tariff system for businesses, which reduced peak-time consumption by 7.1 percent.
Under the proposal for households, the year would be divided into pricing blocks. The highest extra charges would apply between 4 p.m. and 11 p.m. Summer electricity would become cheaper, while winter usage would cost more. “Exactly when people use their heat pump,” said Olof van der Gaag of the Dutch Association for Sustainable Energy.
The exact peak surcharge has not yet been finalized, but the estimated range would be from 15 to 25 euro cents extra per kilowatt-hour. Berenschot estimates annual grid costs for a fully electric household could rise from 558 euros to 1,149 euros, or to 782 euros if the household changes its behavior by, for example, preheating the home during cheaper hours. “But not every house is insulated well enough for it to stay warm until the evening,” Dings told Trouw.
Home batteries could also become somewhat more attractive under the new pricing model, though Dings said many households cannot afford them. “And during the winter months, self-generated solar energy is scarce, so this often will not ease the pain either,” he said.
The proposal is still under review. The Authority for Consumers and Markets will examine the plans in the coming months, hold a public consultation during the summer, and aim to finalize tariffs before the end of the year.
Critics are already calling for changes. Dings said the discounted winter pricing block — set at half the maximum tariff — should be cheaper, while the expensive 4 p.m. to 11 p.m. period should be shortened. “At 10:30 p.m., there is no more grid congestion,” he said.
Van der Gaag said the Dutch government should introduce compensation measures, including higher subsidies for heat pump purchases and, “especially,” lower taxes on electricity.
The Ministry of Economic Affairs and Climate Policy said it is “continuously” assessing how new policies affect heat pumps. The ministry noted that natural gas will become more expensive in the coming years due to carbon pricing and taxes, which could strengthen the financial case for heat pumps.
A ministry spokesperson said possible compensation for heat pump owners affected by the new grid tariffs is “still being examined,” but there are no “concrete plans" yet for the audience. "You need to ask them what they need, rather than constantly trying to determine it from a top-down perspective."