A sustainable industry in the Netherlands cannot exist without green electricity, sustainable gases or circular raw materials. That seems like an open door. But in practice, it is extremely complicated to bring those areas together. The third edition of the MOOI subsidy scheme will start on 1 April, with exactly that goal: combining innovative strength. TKI directors Rob Kreiter (Energy & Industry), Jörg Gigler (New Gas) and Bob Meijer (Wind at Sea) talk about Innovation - next level: the integrated approach.
Under the banner of the Energy Top Sector, the three Top Consortia for Knowledge and Innovation have earned their spurs over the past ten years. Numerous innovations are ready for application, many have already reached the market. But it is not enough. The transition in energy and raw materials is not happening fast enough to be climate neutral by 2050. How can innovation increase that speed?
"For some time now, the industry is no longer just that customer at the end of the gas or power lines" - Rob Kreiter
The basic principle is unanimous: making the industry more sustainable cannot be left to industry alone. Listen to Rob Kreiter: “The two biggest challenges for the industry are electrification of processes and circular production. This is not possible without integrated innovation chains and new interactions. For some time now, the industry is no longer just that customer at the end of the gas or power pipelines. The industry will co-develop green electricity and sustainable gases and is already preparing to take back the materials and products it produces itself.
The industry needs offshore wind energy for electricity and sustainable gases such as hydrogen for the circular economy. Conversely, the developments in offshore wind and the coupling with hydrogen cannot do without the input of the industry. Rather than talking about interdependence, the TKI directors talk about 'integrating systems'. Bob Meijer: “Look, for example, at the financing of new offshore wind farms. A project developer puts it down for 25 or 30 years, so that's how long the security wants to earn back the investment. The electricity price is therefore uncertain. Industry can play an important role in financing. Because in addition to mobility and buildings, the industry is a very large customer.”
There are other reasons for close interweaving, Meijer continues: “To be able to handle a large flexible supply of wind energy, you also need innovation on the consumption side. Think of the variable purchase of electricity, depending on the supply. Also, think of storage to bring supply and demand together. This requires a new market system that companies can use.”
"Without multi-dimensional collaboration, things get stuck" - Jörg Gigler
Jörg Gigler adds: “In our energy and raw materials system, we cannot live without each other. Our most important task as the Top Sector is to facilitate the preparation of innovations for the market; technologically, but also in terms of safety, accepted, with sufficient knowledge and manpower or 'human capital', with the help of digitization and robotization, without other disadvantages for the environment. In fact, this involves closing the chains between all those subjects. Within those chains, I see our TKI as a facilitator for sustainable gases, such as green gas and green hydrogen. But without multi-dimensional collaboration, things get stuck.”
"The first editions of MOOI are the first step in the integration of chains, we should celebrate that" - Bob Meijer
Cooperation between the sectors is of course not new. Broad consortia have been a requirement since the start of the MOOI scheme in 2020, in which making industry and electricity production more sustainable are two important topics. Such consortia must include at least a few parts of the chain, which can be selected from multidisciplinary research, knowledge institutes, companies, network operators, end-users, lawyers, socio-economic experts, and so on, depending on the project. Rob Kreiter: “The MOOI scheme was introduced in 2020 at a time when we were just ready: a new philosophy, driven by missions in the energy and raw materials transition, such as making the industry more sustainable.”
Bob Meijer: “The first editions of MOOI are the first step in the integration of chains, we should celebrate that.” But the chain formation extends further than subsidy schemes. “Wind meets Industry (the collaboration between the wind industry and the process industry, RdV) is a good example of a movement in which the parties themselves think about the opportunities, about eliminating bottlenecks and about co-developing in chains. New target groups for innovations are also emerging.” Gigler: ”Wind meets Industry is actually a confirmation of our lasting relationship.”
When asked, the three directors each name a 'flower' from previous MOOI calls. Meijer: “The MOOI-Sigohe scheme (System solutions for large-scale renewable electricity generation) contains many different links that are required for system integration: transport and distribution, storage and conversion, and use. This includes new parties for us, and links are constantly being added. Cost reduction has long been the guiding principle for offshore wind. But it is also increasingly about flexibility, safety, spatial adaptability, impact on the environment and other facets.”
Rob Kreiter mentions the INReP project for plastic recycling in a circular economy: “INReP includes parties from the waste sector, chemistry, conversion processes such as pyrolysis, packers, producers, and so on. Sometimes parties sometimes think that an integrated approach to innovation equals complexity. This is a very large consortium, integral, and at the same time with a clear focus and result orientation. So it can go well together.”
Jörg Gigler refers to the Hyscaling project, in which many parties form a chain for the upscaling of electrolysis for the production of green hydrogen. “There are parties in it such as VDL, TU/e, Hanze University of Applied Sciences Groningen, producers. Of course we still have to wait for the results, but a project like this gives me the confidence that we can do this in the Netherlands.”
Learning how to integrate
The first steps have been taken, what now? Rob Kreiter: “We are still learning how to integrate. There was sometimes quite a bit of confusion within MOOI, for example between the submitters of integrated chain projects and the assessment committee. In the next round we will understand even better where the sweet spot is. What I find essential: instead of constantly thinking about what is so good about the innovation itself, we are increasingly learning to ask the question: What else is needed to get innovations applied?
So what else is needed to make the industry more sustainable? Bob Meijer answers from his background: “After all the cost reduction, there is now no subsidy for wind farms. Then you might be inclined to think that the biggest innovations have already been done, that we have already passed the steep part of the S-curve. But if you include the chemistry, such as the conversion of electricity to ammonia or the production of synthetic fuels, the costs will have to be reduced even more. If we don't want to depend solely on imports, then we are actually only halfway down the S-curve.”
The TKI directors unanimously believe that Dutch industry is a good breeding ground for further sustainability. Jörg Gigler: “Some parties want to, others know they have to. But the challenge is huge, so all that curiosity now has to be turned into action. I think that the technology is often already present, such as a hydrogen burner. But how are you going to apply it?: safely, with sufficiently qualified personnel and a good policy. That's not all there yet. BEAUTIFUL is fine, but at best only suitable for the realization of a first pilot project. Ideally, completed MOOI projects will soon be linked to the DEI+ subsidy scheme to demonstrate the innovation, and then the SDE++ for the first market applications.”
Rob Kreiter also sees major bottlenecks in practice. “Look at the flexibility of the power demand. There is currently no revenue model for this: a different payment model plus network rates to earn back your investment. Policy and market innovation is therefore required. Also, the price incentive of emissions trading is still too low to keep up the pace. For example, sustainable production remains more expensive than the conventional method. To bridge that gap, we will need at least temporary subsidies. Legislation, regulations and standards must grow with them. And we will need space. Innovations such as electrolysers for the production of green hydrogen will also be visible in the landscape.”
Kreiter also points out the major differences between the types of industry: “The large companies have their own research department. But the paper mill or the food producer cannot develop it themselves. They are dependent on collaboration, for example in the 'Sixth industry cluster' (the term for the collected smaller companies outside the large industrial areas such as Maasvlakte or Chemelot, RdV).”
Still, the light is green. Kreiter: “We are really in a different phase than five years ago, when we mainly focused on energy savings. Companies are already taking the next steps and are coming to us themselves. Some are going faster than I could imagine. See Tata Steel with their hydrogen plans, see Shell and Dow en route to the application of electric crackers around 2035, and see the large number of heat pump projects in the food and paper industry. We facilitate those companies, with our coalitions, learning communities, and with the translation of innovations into training. From here, the development can sometimes go very fast. And even then the question is whether we can innovate enough to keep all industry in the Netherlands. But perhaps we should aim for only those processes and activities with high added value.”