In the Netherlands, a market mechanisme is used to implement the targets to increase the share of renewable energy used in the transport sector and reduce greenhouse gas emissions.
At the heart of the Energy for Transport system is a market mechanism based on renewable energy units (hernieuwbare brandstofeenheden, HBEs). Both the annual obligation and the reduction obligation are expressed as a required number of HBEs.
In order to comply, companies subject to an obligation must ensure they hold sufficient HBEs in their account in the Energy for Transport Registry before 1 May of each year.
Companies that physically deliver renewable energy to the transport sector can register those deliveries in the REV, thereby generating HBEs. One HBE held in an REV account represents 1 gigajoule of renewable energy used, as well as a specific reduction in greenhouse gas emissions, the level of which is set each year. One HBE held in an account therefore represents a contribution towards to both the mandatory use of renewable energy and the reduction obligation.
The following options are open to companies that are subject to both the annual obligation and the reduction obligation:
the company delivers renewable energy and registers this in the REV to obtain HBEs and uses the HBEs to fulfil its own obligation; or
it purchases HBEs from other companies; or
it can use a combination of both options.
Under the Energy for Transport implementation system, the Dutch government applies an emissions trading system through which participants can jointly deliver their mandatory share of renewable energy, and reduce their greenhouse gas emissions in the most cost-effective way.
Companies with an REV account can transfer HBEs among each other. All companies subject to an obligation, companies registering deliveries, and other licensed excise warehouse keepers can have an account in the REV
Companies must make mutual agreements among themselves on the trade of HBEs, regarding the prices and types of HBEs. This happens outside the REV, without involvement of the NEa.
HBEs
To encourage the use of specific feedstocks or types of renewable energy, and discourage the use of others, the total annual obligation has been subdivided into a subtarget and limitations. With regard to the subtarget and the limitations, a distinction is made between four types of HBEs: HBE Advanced, HBE Conventional, HBE Annex IX Part B and HBE Other.
Companies subject to an annual obligation must have a minimum share of HBE Advanced (HBE-G) and may use a maximum share of HBE Conventional (HBE-C) and HBE B Annex IV B (HBE-B). HBE Other (HBE-O) must cover the remaining share of the annual obligation. The type of HBE that is created is determined by the type of renewable energy registered and/or the feedstock used for the biofuel.
The table below shows the origin of various types of HBEs.
HBE types and origin
HBE type
Created by claiming delivery of
Further description
HBE-advanced
Liquid or gaseous advanced biofuel
Biofuel produced from foodstocks mentioned in Annex IX, part A of the Renewable Energy Directive (waste flows and residues)
HBE-Annex IXb
Liquid or gaseous biofuel
Biofuel produced from foodstocks mentioned in Annex IX, part B of the Renewable Energy Directive (used vegetable/animal oils and fats)
HBE-conventional
Liquid or gaseous conventional biofuel
Biofuel produced from agricultural and energy crops
HBE-Other
Liquid or gaseous other biofuel
Biofuel produced from catch crops, or from residues of food and feed crop production/processing, as far as these are not mentioned in Annex IX of the Renewable Energy Directive
Electricity
Liquid or gaseous renewable fuel
The NEa is legally obliged to publish a number of reports based on data in the REV. One of these reports is the HBE report. This report provides periodic information to support the market. The HBE report is published five times each year.
Every HBE report provides insight into the total number of HBEs that are available in the REV accounts. The report distinguishes between the number of HBEs created through the registration of deliveries and the number of HBEs banked. The HBE report of 4 March also provides insight into the total number of HBEs required to comply with the annual obligation.
The report dates are:
4 January
4 March
10 May
4 July
4 October
Reporting based on the four types of HBE will begin on 4 July 2022.
The Energy for Transport system is based on the European Directives, but is implemented under Dutch legislation and regulations. Companies cannot trade HBEs internationally or use them in connection with legislation and regulations in other countries. Conversely, companies cannot transfer units from comparable systems in other countries to the REV.
An HBE that has been created and credited incorrectly cannot be revoked. If a registering company has entered an amount of renewable energy incorrectly, the HBEs that were created in error remain valid and can be traded.
Companies that deliver fuel to the Dutch transport market fall under the Energy for Transport legislation and regulations and are therefore subject to obligations.
These are:
licensed keepers of an excise warehouse for mineral oils;
licensed Registered Consignees for mineral oils;
importers subject to excise duty as defined in the Excise Duty Act (Wet op de accijns) that have delivered fuels to the Dutch transport sector.
The obligation to register fuel deliveries applies to deliveries of the following fuels to the Dutch market:
petrol (including bio-components);
diesel (including bio-components);
heavy fuel oil (including bio-components) delivered to the marine or inland shipping sector;
other liquid and gaseous biofuels;
liquefied petroleum gas (LPG);
liquefied natural gas (LNG);
compressed natural gas (CNG).
The annual obligation and reduction obligation are calculated based on the reported deliveries (including any bio-components). Companies must meet their obligations by means of the REV. Companies delivering less than 500,000 litres/kg/Nm3 of fuels to the Dutch market are exempt from the obligations.
Companies can voluntarily register deliveries of renewable energy if they deliver liquid biofuels, liquid renewable fuels, gaseous biofuels and/or electricity to the Dutch transport sector. By registering such deliveries in their REV account, they create HBEs, which they can then trade in the REV.
Liquid biofuels and liquid renewable biofuels
The following companies can register deliveries of liquid biofuels or liquid renewable biofuels:
licensed keepers of an excise warehouse licence for mineral oils;
licensed Consignees for mineral oils;
importers subject to excise duty as defined in the Excise Duty Act.
Gaseous biofuels
Companies which are buyers within the meaning of the Gas Act (Gaswet) and deliver gas to the Dutch transport sector via connections to the gas grid (or a direct connection) can register deliveries of gaseous biofuels. They can do so by greening their deliveries with Guarantees of Origin (GOs) in the form of Vertogas certificates.
Electricity
Companies which are buyers within the meaning of the Electricity Act (Elektriciteitswet) and deliver electricity to road vehicles via connections to the electricity grid (or a direct connection) can register deliveries of electricity.
Gaseous renewable fuel
Companies licensed to receive, store and deliver hydrogen under the Environment and Planning Act, that deliver this hydrogen to the transport sector via a metered delivery point, can register these deliveries as gaseous renewable fuel. They can do so by greening the deliveries with ‘Guarantees of Origin for other gases’.
Although registering companies are voluntary participants in the Energy for Transport system, they must nonetheless comply with the prerequisites that apply to the registration of deliveries of renewable energy. The NEa monitors registering companies to verify they comply with the prerequisites.
In general, companies registering deliveries of liquid biofuel are the final link in the biofuel supply chain. To ensure the registered deliveries concern the physical delivery of biofuel and that this is sustainable biofuel, preceding links in the supply chain - such as producers and resellers - must also comply with prerequisites. If these companies are based in the Netherlands, they are also monitored by the NEa.
Companies registering deliveries are allowed to trade in HBEs to ensure that companies subject to an obligation can have sufficient HBEs available to comply with their obligation. In addition, companies subject to an obligation can trade in HBEs with each other.
Other companies can also transfer HBEs in the REV to a limited extent, provided that they are licensed keepers of an excise warehouse for mineral oils.
