The cabinet has decided to extend the Indirect Cost Compensation ETS (IKC-ETS) subsidy scheme for 3 years. The subsidy is an important support for the industry, which is under pressure from high energy prices. Production companies that use a lot of electricity can apply for compensation from the Netherlands Enterprise Agency (RVO) for the extra costs they incur due to the European emissions trading system (ETS).
Extension for multiple years
In 2023, the cabinet decided not to allocate a multi-year budget for the IKC-ETS subsidy scheme. The scheme was extended once for 2024. The Minister of Climate and Green Growth has now decided to extend the scheme by 3 years.
Companies with higher electricity costs under pressure
Dutch companies that use a lot of electricity for their production (electricity-intensive companies) have much higher electricity costs compared to neighboring European countries. This creates unequal competition for the industry within Europe. Due to high electricity costs, there is a greater risk that Dutch electricity-intensive companies will choose to completely stop or move their production abroad.
Climate Package
As part of the climate package (Green Growth Package), the Minister of Climate and Green Growth decided to reopen the IKC-ETS in 2025, 2026, and 2027. In 2025, €167.4 million will be available. For 2026, €129.2 million has been reserved. For 2027, this is €200 million. The subsidy is thus an important support for the industry that is under pressure from high energy prices.
Application round 2025
The IKC-ETS will open in August for subsidy applications. Entrepreneurs can submit applications from August 1 to September 1.
European emissions trading system (EU ETS)
The EU ETS requires European electricity producers to purchase emission rights for their CO₂ emissions. They pass these costs on to companies through electricity prices. Companies operating in sectors where a production process requires a lot of electricity experience a competitive disadvantage as a result.
The IKC-ETS is compensation for the indirect electricity costs incurred due to these emission rights in their production. The main goal of the subsidy is to prevent companies from relocating their production to a country outside the European Union because they have a higher electricity bill due to the EU ETS.
Want to know more?
- Ministry of Climate and Green Growth