1. The Dutch CHP/DH sector in the battle between Economy, Environment and Security of Supply in the liberalized market drs. ing. Teus van Eck Helsinki, 17 june 2003, EH&P Annual Conference

2. Market situation Economy Environment Security of supply Regulation Recommendations Contents

3. Market situation

4. The actual situation Traders DGO’s Consumers ProducersGrid Operators Regulators Government CHP / DH

5. “ Economy ” The long en short term values??? Environment Security of supply The Balance

6. Reality T.V. Low prices High earnings Low risks Market power The future of our children Environment Politicians Free market

7. Dream vs. Reality Dream: No coal, no nuclear and efficient gas CHP in the transition period to 100% sustainability. Reality: Growing demand, gas CHP nearly in bankruptcy and only 2% of total production is renewables. Prosperity-welfare?

8. Economy

10. Fuel Costs for different Power Units

11. Consequences Gas CHP too expensive in night and weekend. Environment is not an item. Bad investment climate for CHP.

12. Environment

13. Priorities? Only promoting Renewables vs. the lowest level of fossil fuel consumption and emissions for the total energy demand? Energy savings vs. the fossil fuel use/emission level per unit electricity/heat? Clear physical CHP electricity definition vs. lowest level of fossil fuel consumption

14. The environmental ranking Quality Renewables Good gas CHP Stegs Bad gas CHP Good coal CHP Modern coal units Bad coal CHP Ranking on base of operational results and not on design efficiency

15. Heat Distribution CHP Back- up/peak Storage GridConsumer Alternative Consumer F F E EEE H F H H E= Electricity F= Fuel H= Heat Energy savings for the total chain between +90% and –40%

16. Some figures 100 km by car –15 kg CO2 1 Dutch family with DH saves 1500 kg CO2/yr 1 Windmill of 1 MW saves 700 ton CO2/yr 1 MWth CHP saves 700 ton CO2/yr

17. Security of supply Technical, availability fuels, the environment Separate electricity production results in 45-75% waste heat Political risks Distributed vs. centralized generation

18. Regulation CHP / DH Regulator DGO’s Consumer Organisations Convenants between government/market parties National support Local Governments E.U. directive CO 2 trading Fuel markets Traders/producers E.U. directive CHP

19. Opportunities-Risks Opportunities: Energy/emissions savings, security of supply, proven technology Risks: Continuity of heat demand and or heat source, economy of scale, weak and uncertain position in electricity and fuel market, level playing field? no structural financial valuation of environmental aspects

20. Recommendation Translate our smile in market power. Result: a structural, payable big smile. CHP smile for the environment Power of the market