20 November 2023

In a recent development, the Executive Committee of CREG (Commission for Electricity and Gas Regulation) approved Elia’s revised tariff proposal for the 2024-2027 regulatory period. This approval sheds a sharp light on the changes in the electricity tariff landscape while raising the question of how these tariffs will contribute to Belgium’s broader recovery plan and the shift to renewable energy.  

The support from Next Generation EU  

Next Generation EU (NGEU) is a temporary recovery instrument to help repair the immediate economic and social damage caused by the coronavirus pandemic. The Recovery and Resilience Facility (RRF) is the hub of NGEU, with loans and grants to support reforms and investments undertaken by EU countries.   

To access NGEU funds, each member state must develop a National Recovery and Resilience Plan (RRP), which sets out a coherent package of reforms and investments for the period 2021-26.     

Of the €750 billion in European NEXT Generation EU support, some €4.5 billion is earmarked for Belgium.    

A step forward in energy and business transition  

The tariffs for the period 2024-2027 have been arrived at in a context of high inflation, but they are mainly driven by the need to provide Elia with the necessary resources to implement its ambitious investment programme. This programme, approved as part of the federal development plan, plays a crucial role in facilitating the transition to renewable energy in Belgium. It is designed to enable Elia to carry out its essential tasks at a time of growing focus on environmental awareness and carbon neutrality.  

The budget approved by CREG shows an interesting dynamic: it is 10% lower than the initial tariff proposal submitted by Elia earlier in the year. However, despite this reduction, electricity transmission tariffs will increase significantly, with an average increase of 77% over the period 2024-2027. Remarkably, these tariffs will remain generally stable in 2024 compared to the current tariffs currently in force (2023). However, from 2025 onwards, a significantly stronger increase is expected. 

Belgium’s recovery plan aiming for a sustainable future  

This approval and the associated tariff changes are not only important for consumers, but also have direct implications for businesses and enterprises in Belgium. The increased tariffs could lead to significant operational cost increases for companies that depend on electricity for their daily operations. It is crucial for these companies to optimise their energy efficiency and explore innovative ways to reduce their carbon footprint.  

What makes this approval even more relevant is the broader context of Belgium’s recovery plan. The country has set itself the goal of recovering from economic challenges, with a specific focus on boosting sustainable growth and promoting environmentally conscious practices. Part of this recovery plan includes investments in energy transition, which makes the adoption of these tariffs more understandable. However, the question arises how these tariff increases will relate to the broader objectives of the recovery plan.  

Belgium, like many other countries, is striving for a green and sustainable future. The adoption of these tariffs suggests a strong commitment to the energy transition, but attention must also be paid to the broader impact on businesses. It is a delicate balance between supporting sustainable initiatives and ensuring that economic activities are not unduly burdened.  

Belgium’s recovery plan moving the energy transition forward  

Another important aspect that should not be overlooked is Belgium’s role in the European energy transition. As a member of the European Union, Belgium is expected to contribute to the transition to clean energy sources and the reduction of CO2 emissions. The approval of these tariffs indicates a willingness to invest in these efforts, but it is crucial that these investments effectively contribute to broader European goals.  

Companies in Belgium must now develop strategies to adapt to this changing tariff situation while contributing to sustainability goals. This can be done by, among other things  

  • Implementing energy-saving measures  
  • Exploring renewable energy sources   
  • Embracing innovative technologies   

In addition, cooperation with government agencies and industry associations is essential to ensure a balanced approach that promotes both economic growth and environmental sustainability.  

The approval of electricity tariffs for the period 2024-2027 marks an important milestone in Belgium’s energy transition and broader recovery plan. It is now up to companies and policymakers to work together to ensure a balanced implementation of these tariffs, promoting sustainable growth without unnecessarily hampering economic vitality. 

With FI Group as your reliable partner, you can navigate the evolving landscape of R&D funding and fully leverage the available incentive measures. 

Yvette Poumpalova 

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