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Opportunities for Flemish CHP after discontinuation of nuclear power stations

Approximately 22% of the Combined Heat and Power (CHP) capacity in Flanders is installed in greenhouse horticulture. The sector has been largely responsible for the growth in installed capacity in recent years. In 2021, it totaled 2.6 GWe and accounted for almost 23% of all electricity generated in Flanders.

Recently, though, political decisions have been made that have affected CHP plants working with fossil fuels. The latest CHP Roadmap focuses on this, as well as on new opportunities for CHP plants.

Phasing out fossil
In November 2021, the Flemish government decided to accelerate the phasing out of certificate support for new or substantially modified fossil fuel CHP installations. Projects with a start date of January 1, 2023, can no longer apply for support compared to the initially planned date of January 1, 2030. Moreover, in December 2022, in light of the energy crisis, the Flemish Parliament approved the introduction of an annual update of the banding factor for CHP plants, with a start date of January 1, 2013. At the moment, it is still unclear what the effect will be on the willingness to invest in the longer term, according to COGEN Vlaanderen.

Every two years, COGEN Vlaanderen publishes a CHP Roadmap. Among other things, the document provides insight into technical and legislative requirements in Flanders and how companies can get the most out of their CHP projects.

At the end of 2025, nuclear power plants in Belgium will be shut down. To ensure the security of the electricity supply in Belgium even after the closure of these plants, the federal government has developed a compensation mechanism. That mechanism - Capacity Remuneration Mechanism (CRM) - grants compensations to those operators that make their generation capacity available to cover imbalances in the electricity network.

This remuneration is allocated on the basis of an auction, with power producers competing to make their capacity available at the lowest price. The CRM is technology-neutral, so any technology that generates electricity is eligible. Not only gas power plants but also biogas CHP plants can participate in the auction.

"The CRM ensures that all technologies, with existing or new generation capacity, demand-side management, and storage, as well as large and small plants, can participate in the auctions," said Tinnen Van Der Straeten, the federal energy minister. "CHP facilities play an important role in ensuring the energy supply. In the new CRM auctions, CHP plants (which no longer benefit from other operating subsidies) will therefore be even better valorized."

Supplement to heat pumps
COGEN Vlaanderen is keen to promote the cooperation between cogeneration and heat pumps. A major concern with the massive conversion from natural gas boilers to heat pumps is the great pressure this puts on the electrical system. If it is very cold outside, all those heat pumps are then working simultaneously and at full power to meet the heat demand, which puts a high pressure on both the grid and power generation. CHP can provide a useful addition here. If it is cold, CHP will not only provide some of the heat but also power that can then be used in those heat pumps. This is also done locally so that not only the production but also the grid is less burdened.