The Netherlands takes a new step towards green export credit insurance | News Report

News | 3 November 2022 | 15:35

According to the declaration signed by the government at COP26, the government’s policy envisages the end of new public support for the foreign fossil energy sector through export credit insurance from 1 January 2023. Under this policy, new projects aimed at the exploration and extraction, processing, storage, transshipment and transportation of fossil fuels, and the use of fossil fuels for electricity generation will no longer be supported. The declaration drawn up at the COP26 climate conference in Glasgow last year was an important step towards further greening export credit insurance.

Seizing the opportunity of energy transition

Although the energy transition can be challenging for companies with multiple operations in the fossil energy sector, this development also offers opportunities for the Dutch business community. In this way, companies can use their knowledge for global climate projects. In addition, the energy transition will require significant investments in green projects in the near future. The government wants to take advantage of these opportunities and is committed to doing so. A number of measures have recently been introduced to better support green deals with export credit insurance, such as insurance for high-risk green deals and green guarantees for investments in green innovation. With additional measures, the government is committed to further greening export credit insurance. For example, credit lines will begin to be actively set up for foreign buyers of Dutch products so that buyers can obtain credit lines covered by export credit insurance for the purchase of goods and services in the Netherlands. In addition, the goal is to have Dutch companies complete 70% of the tasks under the Development Cooperation Infrastructure Program.

Strict conditions for exceptions

As a result of the energy transition, a certain level of investment in fossil infrastructure will still be necessary in the coming years to ensure our energy security. Export credit insurance may therefore remain available for investments in existing fossil infrastructure under certain conditions, as long as the economic life of the infrastructure is not extended. Other exceptions include fossil infrastructure support services, multi-purpose ports and electricity production in low-income countries with extreme energy scarcity. In light of current geopolitical developments, the proposed policy also provides space for projects that guarantee Europe’s security of supply and are in line with Europe’s REPowerEU policy.

Careful implementation

Due to the long preparation time for many projects, the government has chosen to implement a one-year transition period. In this regard, applications submitted before January 1, 2023 (and at the latest December 31, 2023) can develop policies. The Netherlands has chosen to implement cautiously.

Businesses and NGOs have been involved in the development of the COP26 Declaration since it was signed in Glasgow in 2021. At an international level, the development of the COP26 Declaration has been sought in coordination with the co-signatories. The Government wants to ensure that the new policy is introduced carefully and provides a level playing field for businesses. The Government will continue to consult with other signatories to the COP26 Declaration over the coming period. The Declaration is therefore an anticipated policy that can still be amended if policy developments in other countries require it.