Belgium 2022
Energy Policy Review

INTERNATIONAL ENERGYAGENCYThe IEA examines thefull spectrumof energy issues
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Commission also
participates in thework of the IEAThe International Energy Agency (IEA) has conducted energy policy reviews of its member
countries since 1976. This peer review process supports energy policy development andencourages the exchange of international best practices. By seeing what has worked – ornot – in the real world, these reviews help to identify policies that deliver concrete results.
Throughout its 48 years as a member of the IEA, Belgium has been an active contributor
to efforts to foster global energy security and sustainability. I particularly appreciate theleadership that Minister of Energy Tinne Van der Straeten is bringing to international efforts
to achieve these goals, including through the IEA. I thank Belgium for serving in several
critical roles that have strengthened the Agency’s work, including Vice-Chair of the 2022
IEA Ministerial Meeting and Vice-Chair of the IEA Standing Group on Global Energy
Dialogue. I also welcome Belgium’s voluntary contributions to support the IEA’s work on
clean energy transitions in Africa.

FOREWORD

Foreword

Belgium was significantly impacted by the Covid-19 pandemic, with its GDP dropping by
more than 5% in 2020. I am pleased to note that Belgium’s economic recovery plan places
strong emphasis on accelerating its clean energy transition with funding for sustainablemobility, energy efficiency, offshore wind and hydrogen based on renewable energy. This
is in keeping with the important leadership that Belgium has demonstrated in the transition
to clean energy, especially on offshore wind.
Belgium has demonstrated clear support for international co-operation on energy security,
investing heavily to ensure its electricity is highly connected with its neighbours andparticipating in several multilateral forums to promote greater integration of Europe’s
energy system. In co-operation with the Netherlands, Germany and France, Belgium is
working to ensure the security of gas supply as production from the Groningen field isphased out. Thanks to its strong efforts, Belgium is several years ahead of schedule on
infrastructure projects needed to support the Groningen phase-out.
Despite these notable successes in advancing the clean energy transition, Belgium
remains heavily reliant on fossil fuels, with the government currently forecasting that fossil
fuel demand will continue to increase at least through 2030. All sectors have considerable
work ahead of them to meet the country’s targets for increasing the share of renewables
and reducing emissions. I sincerely hope the recommendations proposed in this report will
help Belgium navigate the transformation of its energy system as it seeks to build
momentum towards achieving climate neutrality while maintaining secure supplies ofenergy.
Dr. Fatih Birol
Executive Director

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International Energy Agency

Foreword ........................................................................................................................... 3
1. Executive summary .................................................................................................. 11
Overview ......................................................................................................................... 11
Energy and climate policy ............................................................................................... 11
Key measures ................................................................................................................. 12
Electricity market reform ................................................................................................. 14
Covid-19 response .......................................................................................................... 15
Key recommendations .................................................................................................... 15
2. General energy policy ............................................................................................... 17

TABLE OF CONTENTS

ENERGY INSIGHTSCountry overview ............................................................................................................ 17
Energy supply and demand ............................................................................................ 19
Energy and climate targets ............................................................................................. 21
Energy policy overview ................................................................................................... 23
Energy security overview ................................................................................................ 30
Covid-19 response .......................................................................................................... 30
Assessment .................................................................................................................... 31
Recommendations .......................................................................................................... 35

ENERGY SYSTEM TRANSFORMATION
3. Energy and climate change ...................................................................................... 37
Overview ......................................................................................................................... 37
Energy-related CO2 emissions ........................................................................................ 38
CO2 emission drivers and carbon intensity ..................................................................... 39
Climate targets ................................................................................................................ 40
Climate policy .................................................................................................................. 42
Assessment .................................................................................................................... 46
Recommendations .......................................................................................................... 48
4. Energy efficiency ...................................................................................................... 51
Overview ......................................................................................................................... 51
Energy efficiency targets ................................................................................................. 56
Energy efficiency policy and measures ........................................................................... 57
Assessment .................................................................................................................... 62
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Energy demand by sector ............................................................................................... 52

TABLE OF CONTENTS

Recommendations .......................................................................................................... 64
5. Renewable energy .................................................................................................... 67
Overview ......................................................................................................................... 67
Renewable energy by sector .......................................................................................... 68
Renewable energy targets .............................................................................................. 70
Renewable energy policy and support measures ........................................................... 71
Assessment .................................................................................................................... 74
Recommendations .......................................................................................................... 77
6. Energy research, development and innovation ..................................................... 79
Overview ......................................................................................................................... 79
R&D targets .................................................................................................................... 80
Energy R&D policy and support measures ..................................................................... 80
International collaboration ............................................................................................... 83
Assessment .................................................................................................................... 85
Recommendations: ......................................................................................................... 86

ENERGY SECURITY
7. Electricity................................................................................................................... 89
Electricity generation....................................................................................................... 89
Electricity trade ............................................................................................................... 90
Electricity demand .......................................................................................................... 90
Electricity policy .............................................................................................................. 91
Market structure .............................................................................................................. 93
Infrastructure................................................................................................................... 96
Electricity security ........................................................................................................... 99
Assessment .................................................................................................................. 101
Recommendations ........................................................................................................ 105
8. Nuclear..................................................................................................................... 107
Overview ....................................................................................................................... 107
Nuclear policy ............................................................................................................... 108
Assessment .................................................................................................................. 111
Recommendations ........................................................................................................ 114
Overview ....................................................................................................................... 117
Supply and demand ...................................................................................................... 118
Gas policy ..................................................................................................................... 119
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9. Natural gas .............................................................................................................. 117

Market structure ............................................................................................................ 122
Infrastructure ................................................................................................................. 126
Gas emergency response policy ................................................................................... 128
Assessment .................................................................................................................. 130
Recommendations ........................................................................................................ 133
10. Oil ........................................................................................................................... 137
Overview ....................................................................................................................... 137
Supply and demand ...................................................................................................... 138
Oil policy ....................................................................................................................... 141
Retail market structure .................................................................................................. 142
Prices and taxation........................................................................................................ 143
Infrastructure ................................................................................................................. 143

TABLE OF COTENTSTABLE OF CONTENTS

Oil emergency response and stockholding ................................................................... 145
Assessment .................................................................................................................. 147
Recommendations ........................................................................................................ 149

ANNEXESANNEX A: Review team and supporting stakeholders .................................................. 151
ANNEX B: Glossary and list of abbreviations ................................................................ 154
ANNEX C: Statistical notes ........................................................................................... 157

LIST OF FIGURES AND TABLES

Figure 2.1
Figure 2.2
Figure 2.3
Figure 2.4
Figure 2.5
Figure 3.1
Figure 3.2
Figure 3.3
Figure 4.1
Figure 4.2
Figure 4.3
Figure 4.4
Figure 4.5

Map of Belgium ........................................................................................... 18
Energy supply and demand in Belgium, 2020 ............................................. 19
Energy demand per sector and per fuel, and electricity generation by fuel ....
in Belgium, 2020 ......................................................................................... 20
Total energy supply by source in Belgium, 2000-2020 ................................ 21
Total final consumption by source in Belgium, 2000-2020 .......................... 21
Greenhouse gas emissions by sector in Belgium, 2000-2019..................... 38
Energy-related CO2 emissions by sector and source in Belgium, ..................
2000-2020 ................................................................................................... 39
Energy-related CO2 emissions and main drivers in Belgium, 2000-2020 .... 40
Energy demand and drivers in Belgium, 2000-2020 ................................... 51
Energy demand by sector in Belgium, 2000-2020 ....................................... 52
Industry energy demand by source in Belgium, 2000-2020 ........................ 53
Total final consumption in the buildings sector by source in Belgium, ............
2000-2020 ................................................................................................... 54
Total final consumption in transport by fuel in Belgium, 2000-2020 ............ 55
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FiguresTABLE OF CONTENTS

Figure 4.6

Registered electric vehicles and public charging points in Belgium, ..............
2012-2021 ................................................................................................... 56
Figure 4.7 Indicative energy efficiency targets for Belgium and status, 2004-2020 ..... 56
Figure 5.1 Renewable energy in total final energy consumption in Belgium, ..................
2000-2020 ................................................................................................... 67
Figure 5.2 Renewable energy in key metrics in Belgium, 2020 .................................... 68
Figure 5.3 Renewable energy in electricity generation in Belgium, 2000-2020 ............ 69
Figure 5.4 Renewable energy in heating and cooling in Belgium, 2004-2020.............. 69
Figure 5.5 Renewable energy in transport in Belgium, 2004-2020 .............................. 70
Figure 5.6 Belgium’s 2020 and 2030 renewable energy targets and status, ...................
2004-2020 ................................................................................................... 70
Figure 6.1 Public spending on energy R&D by sector in Belgium, 2011-2020 ............. 79
Figure 7.1 Electricity generation by source in Belgium, 2000-2020 ............................. 89
Figure 7.2 Belgium’s electricity imports and exports with neighbouring countries, ..........
2000-2020 ................................................................................................... 90
Figure 7.3 Annual electricity demand by sector and peak load in Belgium, ....................
2000-2020 ................................................................................................... 91
Figure 7.4 Electricity prices in Belgium and neighbouring IEA countries, 2009-2019 .. 96
Figure 7.5 Electricity infrastructure in Belgium ............................................................. 98
Figure 8.1 Electricity generation from nuclear and share of total in Belgium, ..................
2000-2020 ................................................................................................. 107
Figure 8.2 Planned reductions in nuclear generation capacity in Belgium, .....................
2021-2025 ................................................................................................. 109
Figure 9.1 Share of natural gas in the energy system in Belgium, 2000-2020 ........... 117
Figure 9.2 Belgium’s natural gas net trade by country, 2000-2020 ............................ 118
Figure 9.3 Natural gas demand by sector in Belgium, 2000-2020 ............................. 119
Figure 9.4 Industrial and household gas prices in IEA member countries, 2020 ........ 125
Figure 9.5 Industrial and household gas prices in selected IEA member countries, .......
2009-2019 ................................................................................................. 125
Figure 9.6 Gas infrastructure in Belgium .................................................................... 127
Figure 10.1 Share of oil in the energy sector in Belgium, 2000-2020........................... 137
Figure 10.2 Belgium’s net oil trade by country, 2000-2020 .......................................... 138
Figure 10.3 Oil products production in Belgium, 2000-2020 ........................................ 139
Figure 10.4 Belgium’s oil products net trade by country, 2000-2020 ........................... 139
Figure 10.5 Oil demand by sector in Belgium, 2000-2020 ........................................... 140
Figure 10.6 Oil infrastructure in Belgium ...................................................................... 144
Figure 10.7 Emergency oil stocks by type in Belgium, December 2021 ...................... 147

Table 2.1
Table 2.2
Table 3.1
Table 3.2
Table 7.1
Table 7.2
Table 7.3

Belgium’s 2020 and 2030 energy sector targets and status in 2019 ..............
and 2020 ..................................................................................................... 22
Investments needed to achieve Belgium’s 2030 energy and climate .............
targets according to the National Pact for Strategic Investments ................ 25
Belgium’s non-ETS greenhouse gas emissions and targets, 2013-2020 .... 41
Belgium’s estimated emissions reductions under the LTS2050 .................. 42
Electricity social tariff in Belgium, 2017-2020 .............................................. 93
Share of electricity supplied by the main retail electricity suppliers ................
in Belgium’s regions, 2019 .......................................................................... 95
Electricity generation capacity by type in Belgium, 2013 and 2020............. 97
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TablesTable 7.6
Table 8.1
Table 9.1
Table 9.2
Table 9.3

Belgium’s electricity interconnectors, 2020 ................................................. 98
Change of values by supply indicators for transmission networks .................
in Belgium, 2016-2020 .............................................................................. 101
Change of values by supply indicators for distribution networks ....................
in Belgium, 2016-2020 .............................................................................. 101
Nuclear capacity in Belgium in 2020 and connection dates ...................... 108
Natural gas social tariff consumers covered and cost reduction ....................
in Belgium, 2017-2020 .............................................................................. 122
Belgium’s gas network’s capacity, February 2021 .................................... 126
The crisis levels of the gas supply in Belgium ........................................... 129

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Table 7.4
Table 7.5

TABLE OF COTENTSTABLE OF CONTENTS

Overview
Belgium’s energy policy is focused on transitioning to a low-carbon economy while
ensuring security of supply, lowering costs for consumers, increasing market competitionand continuing integration with the European energy system. The federal government iscommitted to phasing out most nuclear electricity generation by 2025 and has developed
a capacity remuneration mechanism that aims to ensure security of electricity supply. In
light of the Russian invasion of Ukraine and goals to reduce fossil fuel dependency, thefederal government decided in March 2022 to take the necessary steps to extend 2 GW ofnuclear capacity by ten years, and introduced a EUR 1.2 billion package to accelerateenergy transition and protect consumers from high energy prices. Belgium is also working
with France, Germany and the Netherlands to ensure that security of gas supply ismaintained as production from the Groningen gas field is phased out.

ENERGY INSIGHTS

1. Executive summary

Since the IEA’s last energy policy review in 2016, Belgium has made progress on its
energy transition. From 2010 to 2020, the share of renewable energy in Belgium’s total
final energy consumption increased from 6% to 12%, driven by growth in renewableelectricity generation, mainly from wind and solar photovoltaics (PV), and an increased
use of bioenergy, mainly for industrial and building heating and for transport. Progress onrenewable energy has been especially pronounced for offshore wind. In 2021, Belgium
had the sixth-highest offshore wind capacity in the world and is planning for a major
expansion of offshore wind deployment.
Belgium faces notable challenges as it continues to push for its energy transition. In 2020,
fossil fuels (mainly oil and natural gas) accounted for 71% of its energy supply. Most fossil
fuel demand comes from industry and transport, but Belgium’s buildings also have anotable demand for gas, while oil covered 33% of residential building demand in 2020.
Because of the high share of fossil fuels in its energy supply, Belgium has seen only limited
reductions in greenhouse gas (GHG) emissions in recent years. From 2011 to 2019,energy-related GHG emissions fell by just 3.5 million tonnes of carbon dioxide (Mt CO2) toreach 90 Mt CO2. More aggressive policies are needed to reduce Belgium’s fossil fueldependency and accelerate emissions reductions, especially given that the nuclear phaseout will increase the carbon intensity of electricity generation.

Responsibility for Belgium’s energy and climate policy is divided between the federal
government and the regional governments of Flanders, Wallonia and the Brussels-Capital
Region. The federal government is responsible for electricity transmission and large-scale
generation; transport of natural gas and oil; nuclear energy; security of energy supply;
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Energy and climate policy

1. EXECUTIVE SUMMARY

price policy; consumer protection; the national rail system; transportation fuels; offshore
energy; and energy research, development and demonstration (RD&D) related to its
competences. Regional governments are responsible for renewable energy (except
offshore energy), energy efficiency and GHG emissions (except for federal buildings andvehicles), distribution of electricity and natural gas, regulation of retail energy markets,
vehicle registration, public transportation, urban and rural planning, and energy RD&D
related to their competences.
Belgium has a wide range of energy and climate targets for 2030 aiming for energy
transition and achievement of European Union (EU) targets. GHG emissions from
Belgium’s energy-intensive industrial facilities and large electricity generation plants are
regulated under the EU Emissions Trading System (ETS). Belgium’s National Energy andClimate Plan (NECP) sets 2030 targets for a 35% reduction of non-ETS GHG emissions
versus 2005 levels; for primary energy demand less than 42.7 million tonnes of oil
equivalent (Mtoe) (compared to 49.1 Mtoe in 2019 and 43.9 Mtoe in 2020); for final energy
demand less than 35.2 Mtoe (compared to 35.8 Mtoe in 2019 and 33.3 Mtoe in 2020); forrenewable energy to reach 17.5% of gross final energy consumption, 37.4% of electricity
generation, 11.3% of heating and cooling demand, and 23.7% of transport demand; andto increase total RD&D spending to at least 3% of gross domestic product (GDP).
The EU-wide 2030 GHG emissions reduction target has been increased from 40% to 55%.
Belgium will therefore have to increase its targets for emissions reduction, energy
efficiency and renewable energy. Belgium should update its NECP with increased targets
and additional measures to support the EU-wide 55% reduction target. The federal andregional governments are in the process of developing a burden-sharing agreement todivide responsibility for Belgium’s 2030 targets. The burden-sharing agreement should
account for the increased EU-wide GHG target and should be concluded in a timely
manner to give clarity to all stakeholders involved in its implementation.
Belgium supports EU carbon neutrality by 2050 and under EU requirements has adopted
its own Long-term Strategy for energy and climate (LTS2050). The LTS2050 aims to put
Belgium on a path that supports the Paris Agreement and EU 2050 carbon neutrality, but
it does not include a clear target for national climate neutrality by 2050. Belgium should
update its long-term strategy to include a clear commitment and path to 2050 carbon
neutrality.

Key measures

The federal government established a dedicated offshore wind zone covering 225 square
kilometres (km²). As of 2021, 9 offshore wind farms with a total capacity of 2.26 gigawatts(GW) had been built in the offshore wind zone. Belgium is developing a second offshore
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The NECP is Belgium’s main energy and climate policy document, defining the measures
the federal and regional governments will implement to help achieve Belgium’s 2030
targets. The NECP’s measures are focused on reducing energy demand and increasing
the deployment of renewable energy, especially for electricity generation and transport.
Achieving the targets for electricity generation (reduced emissions and an increased
renewable energy share) are promoted mainly through the ETS and programmes that
require electricity suppliers to obtain green certificates linked to electricity generated fromrenewables.

wind zone of 281 km² and a planned capacity of up to 3.5 GW. The federal government isdeveloping competitive bidding procedures to drive cost-effective deployment in thesecond offshore wind zone. Belgium’s transmission system operator (TSO) developed amodular offshore grid to connect offshore wind projects to the onshore grid. This offshore
grid will be expanded and upgraded to connect projects developed in the second offshore
wind zone. The federal government is examining options to further increase offshore wind
generation, including repowering the first offshore wind zone and creation of a third
offshore wind zone.
Renewable energy in transport is promoted mainly through a federal biofuels blending
mandate that requires all companies selling road transportation fuels to achieve a certain
share of biofuels by energy content in their annual fuel sales (9.55% for 2020 and 2021).
The NECP proposes annual increases to reach 13.9% by 2030. Reductions in transport
emissions and energy demand are also promoted through vehicle taxation that favours thepurchase of low-emission vehicles and electric vehicles (EVs). There are also numerous
measures to reduce transport emissions and energy demand through modal shifts awayfrom private cars to public transport, walking and biking.

ENERGY INSIGHTS

1. EXECUTIVE SUMMARY

Regional governments have responsibility for reducing buildings emissions and theirenergy demand and for increasing renewable heating and cooling. There is a wide variety
of measures, including direct financial support, loans and tax deductions for renovations;building codes; energy performance certificates; and information platforms for consumers.
There is a notable focus on transitioning away from oil-based heating, with regional
programmes favouring heat pumps and renewables. The federal government also
contributes by setting appliance efficiency standards.
Reductions of industry emissions and energy demand are mainly driven by the ETS andvoluntary agreements between regional governments and industry. The voluntaryagreements vary by region, but in general focus on audits to identify cost-effective energy
efficiency measures, with companies receiving tax relief or other incentives if thesemeasures are implemented. The voluntary agreements focus on energy-intensive
industrial facilities, but there is an increasing effort to include small and medium-sizedenterprises (SMEs).

The federal government aims to reform federal taxation to make it more climate- andenvironmentally friendly, following the polluter-pays principle and sending price signals
supporting decarbonisation. In support of this reform, the federal government will carry out
a study in consultation with the regional governments to be published in 2022. Proposals
for fiscal reform based on this study will be made by late 2023. Belgium should consider
the reform of federal taxation as an opportunity to eliminate fossil fuels, introduce broader
carbon pricing and better align energy prices (especially for electricity) with its energy
transition goals.
To address energy poverty and ensure energy access, Belgium has a social tariff that
results in reduced gas and electricity bills for residential consumers that meet certain
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In 2018, the federal government published a report on the results of a national debate oncarbon pricing for non-ETS sectors. The report detailed the impact of three carbon-pricing
options on fossil fuel prices and on emissions from transport, buildings, non-ETS industry
and other sectors, but so far no decision on carbon pricing has been taken. Under EU
directives, Belgium developed an inventory of fossil fuel subsidies and is committed toeliminating fossil fuel subsidies.

1. EXECUTIVE SUMMARY

socio-economic requirements. The federal government automatically notifies energy
suppliers which of their consumers qualify for the social tariff. All energy suppliers must
provide the social tariff to their qualifying consumers. In 2020, 9.7% of electricity
consumers (around 470 000 consumers) and 10% of gas consumers (around 295 000
consumers) received the social tariff. There are additional federal and regional
programmes to address energy poverty.

Electricity market reform
Electrification is a central aspect of Belgium’s push for energy transition. However,
Belgium’s low heating oil and gas prices and high electricity prices significantly limit the
incentive for electrification. In 2019, Belgium’s retail gas prices were among the lowest in
Europe, and electricity prices for households were the third-highest among IEA member
countries, while the retail electricity price for industry was the sixth-highest. Under thecurrent tariff structure, home heating with electricity is 50% more expensive than heatingwith natural gas or fuel oil, even though electric heating is more efficient and less polluting.
A key reason for Belgium’s high electricity prices is the high level of charges that are notassociated with electricity generation, transmission or distribution. The high cost ofelectricity limits its ability to compete with other energy carriers and reduces the incentive
for consumers and businesses to invest in electrification of building heating, transport,
industrial processes and other key areas. A change in the tariff structure is needed toensure that electricity prices align with the energy transition goals. Lower electricity prices
also improve the situation of vulnerable households and help foster industrial
competitiveness.
In 2019, Belgium had the highest consumer switching rate for electricity in Europe.
However, Belgium’s electricity market remains highly concentrated, with limitedcompetition. In 2019, just one supplier had a 72% market share at the wholesale level,
while just four suppliers dominated Belgium’s retail electricity markets. More effort isneeded to remove barriers to competition and ensure that new companies and innovative
services can enter the market.

Belgium has also made progress on energy security. The infrastructure projects supportinga secure gas supply after the Groningen phase-out should be complete several years
ahead of schedule. However, Belgium lacks a national strategy and plan for decarbonising
the gas sector, including mid- to long-term targets for low-carbon gases such as
biomethane and hydrogen. More clarity is needed on the decarbonisation of the gas sector,
especially as the nuclear phase-out is expected to result in the deployment of newgas-fired electricity plants.

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There are also notable concerns over the time required to obtain permits for theconstruction of transmission infrastructure and generation facilities, especially onshore
wind and large-scale solar PV. Timely project permitting is essential, especially given theneed to quickly develop new generation and transmission capacity to ensure a secure
electricity supply during and after the nuclear phase-out, and to support the strong
deployment of renewable energy needed to meet the energy transition goals.

Covid-19 response
Belgium is still assessing the impact of the Covid-19 pandemic on its energy policies andmarkets. Several measures to address the impacts of the pandemic on the energy sector
have been implemented. In 2020, eligibility for the social tariff was temporarily expanded
to all consumers with a gross income below EUR 20 000, which significantly increased thenumber of consumers receiving it. In addition, the deadline for requesting payments fromthe Social Heating Fund were extended and the government expects the number ofhouseholds receiving these payments to increase. The regional governments also took avariety of steps to protect vulnerable consumers and extended the deadlines to apply forzero-emission vehicle grants, to repay loans for building energy efficiency measures andto obtain building energy performance certificates.
In response to the pandemic, the European Commission approved Belgium’s
EUR 5.9 billion National Recovery and Resilience Plan. More than half of the plan’sfunding contributes to Belgium’s climate and energy goals, including EUR 1 012 million forbuilding renovation, EUR 672 million for modal shifts in transport and EUR 100 million forthe development of an offshore energy hub. Several measures support investments in
production, transportation and the use of hydrogen produced from renewable energy, witha goal for Belgium to reach at least 150 megawatts (MW) of electrolysis capacity by 2025.
The plan also supports a legal framework for carbon capture, utilisation and storage(CCUS), including cross-border infrastructure for CO2 transportation.

ENERGY INSIGHTS

1. EXECUTIVE SUMMARY

The European Commission provided an overall positive endorsement of Belgium’s planand noted that it should have a positive economic impact and drive public and private
investments in areas relevant for Belgium’s energy and climate goals. However, theCommission pointed out that the plan contains limited investments in renewable energy
and indicated that additional funding and measures beyond what is detailed in the plan areneeded to achieve Belgium’s 2030 renewable energy targets.

Key recommendations
The government of Belgium should:
 Update the National Energy and Climate Plan with new targets and measures that
support the European Union’s 55% emissions reduction target and provide long-term
certainty to stakeholders for making the necessary investments for decarbonisation.
 Agree on long-term climate and energy targets at a national level for the period
2030-2050, including a national 2050 carbon neutrality target, as part of a stable
regulatory framework to provide clarity to investors and consumers.

 Use the reform of taxation to create appropriate price signals to drive decarbonisation
across the entire economy and to support electrification.
 Ensure that infrastructure planning, approval and permitting processes allow for thetimely expansion of transmission and distribution systems needed to support a rapid
and sustained renewables deployment, especially for the second offshore wind zone.
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 Ensure measures addressing energy poverty foster the use of renewable energy andenergy efficiency improvements, enable a just transition that protects vulnerable
households, and make them part of the energy transition.

Key data (2020)
TES: 50.4 Mtoe (oil 36.2%, natural gas 30.1%, nuclear 17.8%, bioenergy and waste 7.6%,
coal 4.7%, solar and wind 3.1%, heat 0.5%, hydro 0.05%, electricity exports -0.1%), -8.6%
from 2010 to 2019, -8.1% from 2019 to 2020

ENERGY INSIGHTS

2. General energy policy

TES per capita: 4.4 toe/cap, -13% from 2010 to 2019, -9% from 2019 to 2020 (IEA average:
3.8 toe/cap)
TES per GDP: 97 toe/USD million, -20% from 2010 to 2019, -2% from 2019 to 2020 (IEA
average: 91 toe/USD million)
Energy production: 13.8 Mtoe (nuclear 65.2%, bioenergy and waste 21.1%, solar and wind
11.4%, heat 1.7%, coal 0.4%, hydro 0.2%), -0.3% from 2010 to 2019, -13.0% from 2019 to
2020
TFC: 38.0 Mtoe (oil 45.7%, natural gas 26.8%, electricity 17.9%, bioenergy and waste 5.5%,
heat 1.2%, solar 0.1%, coal 1.0%), -6.0% from 2010 to 2019, -5.2 from 2019 to 2020

Country overview

Belgium is a constitutional monarchy, with the monarch (King Philippe since 2013) serving
as head of state and appointing the prime minister as head of government. Since October
2020, the prime minister is Alexander De Croo of the Open Flemish Liberals and
Democrats party. Belgium is a federal state composed of three regions (theBrussels-Capital Region, the Flemish Region and the Walloon Region) and threecommunities (the Flemish Community, the French Community and the German-speaking
Community). The Constitution also recognises that Belgium is comprised of four language
areas (a Dutch-speaking area, a French-speaking area, the Brussels-Capital bilingual area
and a German-speaking area).

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The Kingdom of Belgium (hereafter Belgium) has a total land area of 30 688 km2 and islocated in Western Europe bordering France, Germany, Luxemburg and the Netherlands.
In 2020, Belgium had a population of 11.5 million and one of the world’s highest population
densities (376 inhabitants per km2). The City of Brussels, with a population of 180 000, isthe capital and hosts a number of EU institutions, including the European Parliament, theEuropean Commission and the European Council. Antwerp is Belgium’s most populous
city, with a population of 520 000, and is home to the Port of Antwerp, the second-largest
port in Europe and a major hub for industry (Port of Antwerp, 2021).

2. GENERAL ENERGY POLICY

Belgium is a founding member of the EU, the International Energy Agency (IEA), theOrganisation for Economic Co-operation and Development (OECD), the North Atlantic
Treaty Organization, the United Nations, and the World Trade Organization. Belgium isalso part of Benelux, a political and economic union with Luxembourg and the Netherlands.
Figure 2.1 Map of BelgiumThis and all the maps in this report are without prejudice to the status of or sovereignity over any territory; to thelimitation of international prontiers and boundaries; and to the name of any territory, city or area.

Belgium’s strategic location in Europe and large port facilities make it a hub for commerce.
In 2019, Belgium was the seventh-largest economy in the EU, with a GDP of
USD 628 billion and GDP per capita of USD 54 693. The Covid-19 pandemic notably
impacted Belgium’s economy, reducing GDP to USD 598 billion and GDP per capita to
USD 51 873 in 2020. Belgium’s economy relies mainly on the service sector (78% of GDP
in 2018) followed by the industry sector (21% of GDP), while agriculture, forestry andfishing together account for less than 1% of GDP. The unemployment rate was 5.3%
in 2021, lower than the OECD average of 6.6%.

There is no hierarchical link between the federal legal norms and those of the constituent entities and the autonomyof the various constituent entities should be regarded as the main principle. In this note, there is a clear distinction
between Belgium (geography, or the four entities together) and the federal government.
1

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Responsibility for Belgium’s energy and climate policy is divided between the federal
government and the regional governments of Flanders, Wallonia and the Brussels-Capital
Region. 1 The federal government is responsible for large electricity generation andtransmission, transport of natural gas and oil, nuclear energy, security of energy supply,
price policy, consumer protection, the national rail system, transportation fuels, offshore
energy generation, and energy RD&D related to its competences. Regional governments
are responsible for renewable energy (except offshore energy), energy efficiency and
GHG emissions (except for federal buildings and vehicles), distribution of electricity andnatural gas, regulation of retail energy markets, vehicle registration, public transportation,
urban and rural planning, and energy RD&D related to their competences.

Energy supply and demand
Belgium’s energy supply and demand are dominated by imported fossil fuels. In 2020, oil
accounted for 36% of total energy supply (TES), followed by natural gas (30%) and coal(5%) (Figure 2.2). All of Belgium’s oil and natural gas supplies are imported. Belgium’s lastcoal mine closed in 1992 and most of the coal supply is imported. However, in 2019, 2%
of Belgium’s coal supply was sourced domestically from slag heaps at former mines.
Nuclear plays a major role in Belgium, covering 18% of TES in 2020. Most of Belgium’s
final energy demand is covered by oil (46% of total final consumption [TFC] in 2019) andnatural gas (27%), followed by electricity (18%), bioenergy and waste (6%), district heating(1.2%), and coal (1%). Industry accounts for the largest share of Belgium’s energy demand(48% of TFC in 2020), followed by buildings (32%) and transport (20%). Belgium also uses
a significant amount of oil products from international aviation and marine bunkers,
amounting to 7.5 Mtoe in 2020, or 15% of TES.

ENERGY INSIGHTS

2. GENERAL ENERGY POLICY

Figure 2.2 Energy supply and demand in Belgium, 2020
50

Mtoe
Transformations and losses

40

Other renewables*
Nuclear30

Industry

Electricity

20

Transport

100District heat

Buildings
Total energy supply

TFC (by fuel)TFC (by sector)

Bioenergy and waste
Natural gas
Oil
Coal
IEA. All rights reserved.

Belgium’s energy supply and demand are dominated by imported oil and natural gas. Nuclear
energy plays a major role. Industry has the largest energy demand (48% of TFC in 2020).
* Other renewables includes wind, solar, hydro and geothermal.

The industry sector relies mostly on oil (40%), natural gas (29%) and electricity (18%) andis responsible for almost all of Belgium’s coal demand (Figure 2.3). Transport is the least
diverse sector, with 89% of demand covered by oil, followed by small shares of biofuels(8%), electricity (2%) and natural gas (1%). Most building energy demand is covered bynatural gas (40%), electricity (27%) and oil (27%) with a small use of biomass (5%) andalmost no district heating (0.6%). In 2019, the share of oil in Belgium’s building energy
demand (24%) was the fifth highest among IEA countries and notably higher than the IEA
average of 8%. In 2019, electricity covered 18% of Belgium’s TFC, below the IEA averageof 22%. Belgium’s electricity mix is dominated by nuclear (39% of generation in 2020),
followed by natural gas (30%) and renewables (26.5%, mainly wind, biomass and solar
PV). Belgium’s last coal-fired electricity plant closed in 2016; however, a small share ofelectricity generation (2% in 2020) still comes from one industrial plant that uses coalmainly for heat, but also for electricity generation.
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Source: IEA (2022), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances.

2. GENERAL ENERGY POLICY

Mtoe

Figure 2.3 Energy demand per sector and per fuel, and electricity generation by fuelin Belgium, 2020
20

Energy demand18
16

NuclearNatural gas

Electricity

14

Wind

Solar

12
10

Bioenergy and waste

Bioenergy and waste

8

Solar
Coal

Coal

6
4

Hydro

Natural gas

20Electricity generation
Heat

Industry Buildings Transport

Oil

Oil

0

10

20

30

40

TWh

IEA. All rights reserved.

Industry and building energy demand is dominated by oil and gas, while oil covers mosttransport energy demand. Electricity is generated mainly with nuclear, natural gas and wind.
Source: IEA (2022), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances.

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From 2010 to 2019, Belgium’s TES fluctuated notably between a low of 52 Mtoe in 2015
and a high of 60 Mtoe in 2010, while in 2020 it dropped to 50 Mtoe as a consequence of
the Covid-19 pandemic (Figure 2.4). The fluctuations were driven mainly by fluctuationsof nuclear availability and changes in heating demand for oil and natural gas. The
contribution of nuclear energy experienced strong annual variations, from 6.8 Mtoe
in 2015 to 12.6 Mtoe in 2011, resulting from major maintenance and safety investmentson several reactors. Renewable energy in TES grew from 2010 to 2020, with bioenergy
and waste increasing from 3.5 Mtoe to 3.8 Mtoe, wind from 0.1 Mtoe to 1.1 Mtoe, andsolar from 0.06 Mtoe to 0.5 Mtoe. From 2010 to 2020, the share of fossil fuels in TFC
decreased slightly, from 75% to 74% (Figure 2.5). From 2010 to 2020, oil demand
fluctuated between a high of 21 Mtoe in 2010 and a historic low of 17 Mtoe in 2019. Gas
demand also fluctuated, from a high of 11 Mtoe in 2010 to a low of 9.2 Mtoe in 2014 andwas 10.2 Mtoe in 2020. Demand for electricity was stable, at around 7 Mtoe from 2010
to 2020.

Figure 2.4 Total energy supply by source in Belgium, 2000-2020
60

Mtoe
Nuclear

50

Heat
Electricity imports

40

Other renewables*
Bioenergy and waste

30

Coal

20

Natural gas
Oil

10
0

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ENERGY INSIGHTS

2. GENERAL ENERGY POLICY

Energy supply is dominated by fossil fuels and has fluctuated notably in recent years, mainly
due to maintenance and safety investments on nuclear reactors and changes in transport andheating demand.
*Other renewables includes wind (1.11 Mtoe in 2020), solar (0.456 Mtoe), and smaller shares of hydro (0.023 Mtoe)
and geothermal (0.003 Mtoe).
Source: IEA (2022), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances.

Figure 2.5 Total final consumption by source in Belgium, 2000-2020
45

Mtoe

40
35

Heat

30

Electricity

25

Bioenergy and waste

20
15

Coal

10

Natural gas

5

Oil

0

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Between 2010 and 2020, demand for oil and gas fluctuated, with an overall decrease in oil
demand, while electricity demand was relatively stable.
Source: IEA (2022), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances.

Under EU directives and national laws, Belgium has a wide range of energy and climate
targets for 2020 and 2030, which aim to support the achievement of EU-wide targets(Table 2.1). GHG emissions from Belgium’s energy-intensive industrial facilities and large
electricity generation plants are regulated under the EU ETS. Belgium’s NECP defines
2030 targets for non-ETS GHG emissions, energy efficiency and renewable energy.

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Energy and climate targets

2. GENERAL ENERGY POLICY

Table 2.1 Belgium’s 2020 and 2030 energy sector targets and status in 2019 and 2020
StatusNon-ETS GHG
emissions
Energyefficiency*

Renewableenergy share

Targets

2019

2020

2020

2030

CO2-eq reduction(versus 2005)-8.8%-16.4%-15%-35%

Primary energy
consumption (Mtoe)

49.1

43.9

43.7

42.7

Final energy
consumption (Mtoe)

35.8

33.3

32.5

35.2

Gross final energy
consumption

9.9%

13.0%

13%

17.5%

Electricity*

20.8%

25.1%

20.9%

37.4%

Heating and cooling*

8.3%

8.5%

11.9%

11.3%

Transport

6.8%

11%

10.1%

23.7%

24%

24%

24%

33%

Cross-border electricity interconnection** Indicative targets.

Belgium has a mixed performance on the achievement of its 2020 energy and climate
targets. The target for non-ETS emissions reductions will be achieved under EU
accounting rules that allow credits from years when emissions were below annual targets
to offset deficits for years when emissions exceeded annual targets. Despite a large andlikely temporary reduction in energy demand resulting from the pandemic, Belgium did notmeet its 2020 indicative energy efficiency targets.
Belgium will achieve the 2020 targets for renewables in transport (thanks to increased
biofuels blending in 2020) and for renewables in electricity; the share of renewable heating
and cooling will not reach the indicative target in 2020. Belgium will not achieve a 13%
share of domestic renewable energy in gross final energy consumption. However, it willmeet its 2020 renewable energy target by purchasing statistical renewable energy
transfers from EU member states who exceeded their 2020 renewable energy target.

EU member states must submit a national progress report on the implementation of their
NECP every two years starting in 2023. Based on these reports, the European
Commission will assess progress on 2030 targets at the EU level and for each member
state and take necessary action to ensure that targets will be met. Each member state’s
NECP will receive a final update by 30 June 2024 (with a draft update submitted to theEuropean Commission by 30 June 2023). The NECPs will then be updated every ten years
to support the achievement of the target for EU climate neutrality by 2050.

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The European Commission commented on Belgium’s NECP in October 2020, noting thatthe 2030 targets for GHG emissions reductions supported the achievement of the EU-wide
emissions reduction target, but that Belgium’s 2030 contributions for renewable energy
and for energy efficiency were not sufficiently ambitious to support the achievement of the
EU-wide 2030 targets (EC, 2020). In addition, it is likely that Belgium will need to increase
its 2030 targets and contributions for GHG emissions, renewable energy and energy
efficiency to support the achievement of the increased EU-wide 2030 GHG emissions
reduction target, which was recently raised from 40% to 55%.

Energy policy overview
Responsibility for energy policy is divided between the federal and regional governments.
The federal government is responsible for electricity generation and transmission,transport of natural gas and oil, nuclear energy, security of energy supply (electricity,
natural gas and oil), price policy and consumer protection, the national rail system,transportation fuels (including biofuels), offshore wind generation, and energy RD&D
related to its competences. Regional governments are responsible for the distribution ofelectricity and natural gas, regulation of gas and electricity retail markets, renewableenergy (except offshore energy), energy efficiency and GHGs (except for federal buildings
and fleets), energy RD&D related to its competences, transportation (except national rail,
shipping, aviation and automotive), and urban and rural planning. There is no hierarchy
between the federal and regional governments.
At the federal level, energy matters are handled by the Directorate-General for Energy,
part of the ministry called Federal Public Service for Economy, SMEs, Self-employed andEnergy. The Energy Consultation is a formal body responsible for co-ordinating all energy
policy matters between the federal and regional governments. Climate policy is
co-ordinated between the federal and regional governments through the Coordination
Committee for International Environmental Policy and the National Climate Commission.
The Belgian Competition Authority is an independent administrative authority that
contributes to the definition and implementation of competition policy in Belgium, includingin the energy sector.

ENERGY INSIGHTS

2. GENERAL ENERGY POLICY

In 2017, the energy ministers of the federal and regional governments reached anagreement on a Belgian Inter-federal Energy Pact, which is a common vision for Belgium’s
energy transition to 2030.The Energy Pact guides co-operation on energy policy and wasa key input for developing the NECP, which integrates inputs from the federal and regional
governments and was approved in December 2019.
The NECP is Belgium’s main energy and climate policy document through 2030
(EC, 2019). It defines the national targets that drive policy and measures to be taken by
the federal and regional governments to support the achievement of these targets. The
NECP also identifies measures based on co-operation between the federal and regional
governments, especially on fiscal and financial mechanisms to drive decarbonisation.

Belgium promotes electricity generation from renewable energy primarily throughrequirements that electricity suppliers obtain green certificates. There are four separate
green certificate programmes (one for the federal government covering only offshore wind
generation and one for each of the three regional governments covering a range of
renewable technologies). The regional programmes have increasing annual quotas on thenumber of certificates each electricity supplier must obtain. An offshore renewable energy
scheme has been established by the federal government to support the development of
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Energy efficiency is supported by a range of regional programmes, including energy audits
and voluntary energy efficiency agreements for industry. The main efficiency measures fortransport are EU standards and vehicle taxes and fees that are lower for
low-emission/high-efficiency vehicles and for EVs. The building sector has the widest
range of programmes and measures for energy efficiency, including building codes,
appliance standards, loan and grant programmes, and platforms to support consumers.
There is also a push to reduce oil-based heating in buildings (see Chapter 4).

2. GENERAL ENERGY POLICY

renewable electricity production in the Belgian territorial sea. Renewable energy intransport is promoted through a federal biofuels mandate and some support for EVs,
mainly tax breaks. Renewable heating and cooling are promoted mainly through regionalbuilding codes and support programmes tied to energy efficiency (see Chapter 4).
Under EU regulations, Belgium was required to develop a long-term energy and climate
strategy contributing to the EU 2050 climate neutrality goal. Belgium’s Long-term
Strategy (LTS2050) was adopted in early 2020 and is based on long-term strategies of
the regional governments and also specifies the role of the federal government (CNC,
2020). The LTS2050 is intended to put Belgium on a path that supports achievement of
the Paris Agreement’s goal of limiting global warming to well below 2°C, preferably to
1.5°C, and the EU goal of carbon neutrality by 2050. The LTS2050 is focused onemissions reduction targets for 2050 and details a variety of supporting measures acrossthe electricity, industry, building, transport, agriculture and waste sectors.
In light of the Russian invasion of Ukraine and goals to reduce fossil fuel dependency,
the federal government decided in March 2022 to take the necessary steps to extend
2 GW of nuclear capacity by ten years (see Chapters 7 and 8), and introduced a EUR
1.2 billion package to accelerate energy transition (see Chapters 4 and 5) and to protect
consumers from high energy prices, including temporary reductions in excise duties forgasoline and diesel, and temporary value-added tax (VAT) reductions for electricity andnatural gas.

Energy transition investment
The National Pact for Strategic Investments assesses the strategic investments needed
through 2030 to meet Belgium’s policy goals in the areas of digitalisation, cybersecurity,
education, healthcare, energy and mobility. Based on the pact, the federal government
developed an overview of the estimated investments required to achieve Belgium’s 2030
energy and climate targets, which total EUR 84-88 billion (Table 2.2).

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Experts from the federal and regional governments are co-operating to identify thefunding sources and policy measures that will support the investments identified the
National Pact for Strategic Investments and achievement of the 2030 targets. This work
examines all options, including budgetary and financial tools, various financing
techniques (debt agencies, national promotional banks and financial market
instruments), and funding sources (EU, federal, regional and private). One new sourceof funding is Belgian green linear bonds. In 2018 and 2019, the federal government
launched the first green linear bonds, totalling EUR 6.89 billion, with the income being
used solely for public expenditure on the transition to a sustainable economy. The
expenditure from these bonds for the period 2021-2030 will be made in the transport,
energy and buildings sectors.

Table 2.2

Investments needed to achieve Belgium’s 2030 energy and climate
targets according to the National Pact for Strategic Investments

Area

Funding(EUR billion)

Recommendations

PublicPrivateMajor renovation of
public buildings• Invest heavily in renovating public buildings to make them
intelligent and more energy efficient

8.5

8.5

Electricity mix• Continue to guarantee security of supply at competitive
prices• Continue developing renewable energy, including inhouseholds• Find a solution to further reduce the cost of renewableenergy019Strengthening ofsystems• Invest in transmission and distribution systems to ensurea fair and more flexible transition• Support the development of smart grids

017Development of storage• Use the storage capacity (of vehicles, housing andbusinesses)• Attract a battery producer to Belgium• Develop pumped storage

05Roll-out of alternative
fuels• Ensure that there are sufficient compressed natural gas
refuelling stations and electric vehicle charging stations• Support RD&D in hydrogen and green gas

00.3

Nucleardecommissioning andwaste management
research• Support projects aimed at building the decommissioning
knowledge of Belgian businesses via the Advanced
Belgian Cluster on Decommissioning• Research how to effectively treat nuclear waste

0.7

1

Maintain and develop
integrated transport
networks and services• Service and maintain existing infrastructure• Improve access to towns and cities, particularly throughsuburban rail systems, hubs and integrated cycle paths• Improve rail access to ports and industrial parks andmodernise shipping locks

17.2-20.5

2.8-3.5

Facilitate intelligent
mobility solutions• Create a single group mobility application to facilitate
door-to-door mobility• Roll-out intelligent transport systems to reduce
congestion

1.5-2

0.1

Manage transportdemand• Promote spatial planning and redevelopment of industrial
sites• Create satellite offices and co-working spaces• Smart charging for mobility services• Promotional events on the theme of mobility

02

Establish a support
framework• Create a national mobility observatory• Produce a multiannual, multimodal investment agenda
providing a clear vision of investments and specificgovernance structures at the appropriate level(metropolitan, regional or national)

0

< 0.1

28-32

56-57

Total

ENERGY INSIGHTS

2. GENERAL ENERGY POLICY

84-88

Most of Belgium’s taxation policy, including energy taxation, falls under the control of thefederal government, including taxes and levies for transportation fuels, heating oil, otheroil products, natural gas, coal and electricity. The regional governments also play a role inenergy taxation policy as they control the taxes and fees on vehicles.
Taxes for oil products (diesel, gasoline, heating oil, etc.) consist of an excise duty, a special
excise duty, a levy on energy, the value-added tax (VAT), and federal contributions related
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Energy taxation

2. GENERAL ENERGY POLICY

to oil stockholding and to environmental and social funds (CREG, 2018). Natural gas andelectricity are subject to the levy on energy and the VAT. The value of each tax component
depends on both the type of energy product and the end-use. There are notable tax
exemptions or reductions for certain uses of oil products and natural gas. Household andbusiness consumers pay different tax rates on natural gas and electricity. Overall, industry
and businesses pay lower tax rates on energy than households. Belgium’s tax system also
provides tax deductions for investments that support the energy transition, including forenergy efficiency, renewables and green innovation.
Outside of participation in the ETS (required under EU directives), Belgium does not havea carbon-pricing mechanism. From 2017 to 2018, the government conducted a national
debate on options for implementing a carbon price in non-ETS sectors with a focus onbuildings and transport. The debate involved stakeholders and experts from the private
sector, federal and regional governments, academia, associations, and trade unions. A
report on the results of the debate was published in 2018 (BNDCP, 2018).
The federal government aims to reform federal taxation to make it more climate- andenvironmentally friendly, following the polluter-pays principle and sending price signals
driving decarbonisation. In support of this tax reform, the federal government will carry out
a study in consultation with the regional governments to be published in 2022 with a goal
to propose fiscal reforms by late 2023.
In January 2022, the federal government introduced an energy norm that uses structuralreform and regular monitoring of energy bills to ensure that energy prices in Belgium do
not exceed those of its neighbouring countries. It is foreseen that federal and regionalenergy regulators will conduct an annual study assessing whether excise duties
exemptions or a tariff adjustment are needed to improve the competitiveness of companies
and the purchasing power of households. If necessary, the federal share of the energy bill
can be adjusted. To support implementation of the energy norm, the five federal energy
levies were combined into a single excise duty on 1 January 2022 and the federal shareof the energy bill was fixed at the 2021 level. Flanders also has an energy norm thatfunctions in a manner similar to the federal energy norm, but which affects only energy
fees that come from Flemish policy.

In the first quarter of 2021, the federal and regional governments sent the European
Commission a required inventory of energy subsidies, including those for fossil fuels.
In 2019, the subsidies with the largest forgone tax revenues were the reduced excises forheating oil (EUR 2.1 billion in forgone federal tax revenue), the reduced excises for gas(approximately EUR 1 billion in forgone federal tax revenue), the reduced excises fordiesel for professional users or commercial and industrial use (approximately
EUR 1.5 billion in forgone federal tax revenue), the tax and fiscal treatment of company
cars (approximately EUR 2 billion in forgone federal tax revenue), fuel cards(approximately EUR 0.5 billion in forgone federal income tax), exemption from excise dutyon aviation kerosene (approximately EUR 0.5 billion in forgone federal tax), and voluntaryagreements with industry, which provide lower taxes to companies that meet certain
energy efficiency requirements (approximately EUR 1 billion in forgone federal andregional tax revenue). The regional governments also have policies with respect to fossil
fuel subsidies (to a lesser extent than the federal government since fossil fuel-related
policies mainly fall within the competence of the federal government).
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Fossil fuel subsidies

Under EU regulations, Belgium is required to report on the implementation of measures tophase out fossil fuel subsidies. The federal government will examine options for eliminating
fossil fuel subsidies as part of the study to be carried out in support of the planned tax
reform to make taxation climate- and environmentally friendly. The federal government has
committed to developing an action plan to gradually phase out fossil fuel subsidies,including the favourable tax regime for fossil fuel-powered company cars. The regional
governments have also taken steps to eliminate fossil fuel subsidies, in particular,
eliminating support for oil-based heating in buildings; however, many of these measures
support conversion to gas heating.

Energy poverty
To address energy poverty and ensure energy access for all, Belgium has a social tariffthat results in reduced gas and electricity bills for residential consumers that meet certain
socio-economic requirements. The federal government automatically notifies energy
suppliers which of their consumers qualify for the social tariff. All energy suppliers must
provide the social tariff to their qualifying consumers (FPS Economy, 2022a). In 2019,9.1% of electricity consumers (around 438 000 consumers) and 9.9% of gas consumers(around 266 000 consumers) received the social tariff (CREG, 2020a). In 2021, eligibility
for the social tariff was temporarily expanded for one year in response to the Covid-19
pandemic to all consumers with a gross income below EUR 20 000, for energy customers
who are entitled to the increased reimbursement through the health insurance fund
(FPS Economy, 2022b). Following this expansion of eligibility, 9.7% of electricity
consumers (around 470 000 consumers) and 10% of gas consumers (around 295 000
consumers) received the social tariff (CREG, 2020a). The federal government has
indicated an interest in maintaining the income eligibility criteria for the social tariff.

ENERGY INSIGHTS

2. GENERAL ENERGY POLICY

Since July 2020, the CREG (Belgium’s energy sector regulator) sets the social tariff every
three months. The energy component of the social tariff is set at the lowest retail tariff
available in Belgium over the previous month. The distribution and transmission
components of the social tariff are set to the lowest distribution and transmission tariffs in
Belgium during the previous month. There are also caps that limit how much the tariffs canbe increased from one quarter to the next (CREG, 2020b). From 2017 to 2019, theelectricity social tariff was 34-36% less than the average electricity retail price, while thegas social tariff was 38-48% less than the average gas retail price. The reduced revenues
resulting from the social tariff are refunded to energy suppliers from the fund for protectedconsumers, which is financed by the federal contribution paid by all energy consumers(CREG, 2020b). The expansion in 2021 was financed through public funds so as to notincrease the energy bills (CREG, 2021).

Energy poverty is also addressed through the federal government’s Social Heating Fund,which provides residential consumers that meet certain socio-economic requirements withdirect payments covering a portion of the costs for oil-based heating (kerosene, propane,heating oil). Payments depend on the price paid for the fuel and range from EUR 210 to
EUR 300 per year per household. The Social Heating Fund is partially financed through

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The federal government is working to introduce a social tariff for heating. However, very
little heating demand in Belgium is covered by direct supply of heat. In 2019, district
heating covered just 1% of energy demand from service sector buildings and just 0.2% ofenergy demand from residential buildings.

2. GENERAL ENERGY POLICY

a federal contribution charge to consumers purchasing oil products intended for heating
and partly through public funds (FSC, 2004).
From 2015 to 2019, the share of households receiving payments from the Social Heating
Fund decreased from 96 588 (2% of households) to 85 813 (1.73% of total households).
Payments from the Social Heating Fund are based on receipts sent by qualifying
consumers to accountants certified by the government. In response to the Covid-19
pandemic, the deadline for submitting receipts was extended and the government expects
the number of households receiving these payments to increase.
The regional governments created public service obligations that prevent consumers
unable to pay their electricity or gas bills from being disconnected. The details of the public
service obligations vary between the regions, but in general consumers who cannot pay
their energy supplier (dropped consumers) receive gas or electricity from a supplier of lastresort. The regional governments have assigned the role of supplier of last resort to thevarious distribution system operators. Different systems, including prepaid meters andfederal regulated tariffs, are used to ensure dropped consumers continue to receive
electricity and gas while paying their debts to energy suppliers.
From 2017 to 2019, the share of dropped electricity consumers increased from 81 012(1.7% of electricity consumers) to 85 332 (1.8% of electricity consumers). The share of
dropped gas consumers declined from 62 778 (2.3% of gas consumers) to 59 015 (2.3% ofgas consumers). In response to the Covid-19 pandemic, changes were made to increase
protection for dropped consumers and it is expected that the number of dropped
consumers increased in 2020.
The regional governments also have programmes for residential energy efficiency toaddress energy poverty by providing increased financial support based on socio-economic
conditions. Wallonia provides subsidies to increase the energy efficiency of homes;
low-income residents are eligible for higher subsidies. The amount of energy premiums
provided by the Brussels-Capital Region are also higher for low-income residents.
Flanders has premiums and loan schemes for building renovation and household
appliances that provide favourable access for vulnerable households. People at risk ofenergy poverty in Flanders can apply for a free energy scan. An energy efficiency expert
visits their home to find solutions to reduce their energy bill. Protected consumers in
Flanders have a right to a EUR 150 discount voucher to buy an energy-efficient refrigerator
or washing machine. Flanders also has a programme to renovate low efficiency homes
occupied by low-income residents. Qualifying residents receive EUR 30 000 and technicaland social support throughout the renovation process.

Because of Belgium’s central location in Europe, well-interconnected electricity and natural
gas infrastructure, and large port infrastructure for oil and natural gas trade, the country
plays an important role in the European energy system. Belgium places a priority on
international co-operation related to energy and is highly active in numerous international
institutions focused on energy markets and security. Through the Benelux Union, Belgium
co-operates with Luxembourg and the Netherlands on a wide range of energy issues,
especially related to security of supply. Through the Pentalateral Energy Forum, Belgium
co-operates with Austria, France, Germany, Luxembourg, the Netherlands andSwitzerland on a wide range of energy market and security issues, such as regional
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International collaboration

generation adequacy assessments carried out by the TSOs of Pentalateral Energy Forum
countries in 2015 and 2018. Through the North Seas Energy Cooperation, Belgium cooperates on offshore wind with Denmark, France, Germany, Ireland, Luxembourg, theNetherlands, Norway and Sweden.

Hydrogen
In November 2021, the Council of Ministers approved the federal Hydrogen Strategy,
which lays out the federal government’s vision for low-carbon hydrogen in Belgium’s
economy and energy sector through 2050. The focus is mainly on becoming an import andtrading hub, and on using hydrogen to decarbonise industry and heavy transport (andpotentially other sectors in the long term). The strategy estimated that Belgium’s demand
for low-carbon hydrogen could reach 3-6 terawatts (TWh) by 2030 and 100-165 TWhby 2050, while noting regional demand could be double these values.
The strategy notes EU goals for European electrolyser capacity to reach 6 GW by 2024
and 40 GW by 2030. However, it indicates that Belgium will not become a large-scale
producer of low-carbon hydrogen, citing concerns over limited land area. The strategy
notes that Belgium’s National Recovery and Resilience Plan contains funding to support
the deployment of at least 150 MW of electrolysis capacity by 2026. The strategy does nothave any other targets or goals for low-carbon hydrogen production and indicates thatmost of Belgium’s hydrogen demand will be covered by imports.

ENERGY INSIGHTS

2. GENERAL ENERGY POLICY

The strategy contains four pillars. Pillar 1, “positioning as an import and transit hub for
renewable molecules in Europe”, includes goals of finding international partners for theimport of renewable molecules, providing financial support for hydrogen importinfrastructure by 2022, and pushing for the development of a European voluntary
certification scheme and a register for renewable fuels of non-biological origin by 2025.
Pillar 2, “consolidating Belgian leadership in hydrogen technologies”, includes goals ofadapting existing research and innovation funding to support hydrogen technologies(see Chapter 6), providing financial support to develop hydrogen testing infrastructure by2022 and limited deployment of domestic electrolysis capacity (at least 150 MW by 2026).

Pillar 4, “investing in co-operation”, includes key goals to implement a structural
consultation on hydrogen in Belgium between the federal and regional governments; adopt
a proactive and dynamic attitude within the working groups dedicated to hydrogen(Benelux, Pentalateral Energy Forum, European Union); represent Belgium in internationalorganisations and forums on hydrogen; engage in continuous interactions with the sector,
research institutes and citizens to keep the Hydrogen Strategy up-to-date with the evolving
issues and needs.
The regional governments have also developed strategies and support schemes forhydrogen. They also support several EU projects of common interest on hydrogen.
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Pillar 3, “establishing a robust hydrogen market”, includes goals to implement a frameworkensuring optimal planning of energy networks (hydrogen, electricity and natural gas)by 2021, adapting the legal and regulatory framework for hydrogen pipeline transport
by 2023, with a public consultation of the market players launched in 2022. Pillar 3 also
contains goals on infrastructure, including commissioning at least 100-160 km of new open
access hydrogen transport pipelines by 2026 and a 2030 target to connect the domestichydrogen network to networks in neighbouring countries to become an import and transithub.

2. GENERAL ENERGY POLICY

Wallonia is considering the establishment of a support mechanism to encourage buildinghydrogen-related infrastructure, and the taxation of hydrogen vehicles will be reviewed inorder to fine-tune Wallonia’s objectives in terms of the development alternative fuels. The
regional governments are supporting several EU projects of common interest on hydrogen.
Flanders has a detailed regional Hydrogen Strategy covering production and demand. It
includes targets for large- and small-scale electrolysis with combined capacity of at least
221 MW by 2025 and 560 MW by 2030. It also aims to decarbonise current natural gashydrogen production and to greatly expand hydrogen import and transport infrastructure.
It provides 2025 and 2030 goals to increase the use of hydrogen in industry transport andbuildings. In October 2021, Flanders and the European Investment Bank signed amemorandum of understanding to collaborate on financing and implementing hydrogenprojects in Flanders.

Energy security overview
Belgium faces near-term challenges to the security of its electricity supply. Nuclear energy
is Belgium’s largest source of electricity, covering 47% of generation in 2019. The federal
government is committed to phasing out most nuclear electricity generation by 2025 andhas developed a capacity remuneration mechanism (CRM) that aims to ensure security ofelectricity supply as nuclear generation is reduced. The CRM uses auctions that award
payments for availability of capacity to drive deployment of additional capacity andretention of existing capacity including generation, demand-side response (DSR), storage
and retention of existing of existing capacity There are two auctions per delivery year (oneauction four years ahead of the delivery year and one auction one year ahead)(EUR-Lex, 2019).
The first CRM auction was held in October 2021 for delivery of capacity in 2025 andawarded payments to around 4.4 GW of capacity, mainly to natural gas generation
including new gas-fired plants. In light of the Russian invasion of Ukraine and goals to
reduce fossil fuel dependency, the federal government decided in March 2022 to take thenecessary steps to extend 2 GW of nuclear capacity by ten years, and introduced a
EUR 1.2 billion package to accelerate energy transition (see Chapters 5, 7 and 8).

Covid-19 response
Belgium is still assessing the impact of the pandemic on its energy policies and markets.
However, several measures to address the impacts of the pandemic on the energy sector
have been implemented. At the federal level, eligibility for the social tariff was temporarily
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There are also energy security issues related to Belgium’s natural gas supply. Almost 50%
of Belgium’s gas imports come from the Netherlands. Most of these imports are
low-calorific gas (L-gas) from the Groningen gas field, which will stop production in
mid-2022. Belgium and neighbouring countries are taking steps to ensure security of gas
supply as production from Groningen is phased out. Belgium is in the process of convertingits L-gas network to support high-calorific gas (H-gas). Due to faster than expected
progress on infrastructure conversion, Belgium now aims for a complete transition of its
gas supply and infrastructure to H-gas by 2024, well ahead of the original goal of 2029
(see Chapter 9).

expanded to cover additional consumers. Wallonia developed a regional protectedcustomer tariff that applies to a wider range of consumers than the federal social tariff, andintroduced a new category of economically protected consumer.
Flanders approved legislation providing a lump sum to cover the energy costs ofhouseholds in which at least one member was temporarily unemployed due to thepandemic and prohibiting electricity and gas from being cut off for all households. Flanders
also extended the deadlines to apply for zero-emission vehicle grants, to repay loans forbuilding energy efficiency measures and to obtain building energy performancecertificates. The Brussels-Capital Region extended a winter period prohibition on shutting
off energy meters to cover all of 2020, broadened the criteria of protected consumers toinclude those who lost income because of the pandemic, and created additional energy
grants to encourage renovation and support the construction sector.
In response to the pandemic, the EU approved EUR 750 billion in funding to support
recovery and resilience plans developed by each EU member state. In June 2021, theEuropean Commission approved Belgium’s EUR 5.9 billion National Recovery and
Resilience Pplan. More than half of the plan’s funding contributes to Belgium’s climate andenergy goals, including EUR 1 012 million for building renovation, EUR 672 million formodal shifts in transport and EUR 100 million for the development of an offshore energy
hub (EC, 2021).

ENERGY INSIGHTS

2. GENERAL ENERGY POLICYThe Belgian plan includes investments to improve the energy efficiency of public buildings
and private and social housing, including renovation subsidies for households. The plan
has several measures to increase efficiency and reduce emissions from the transport
sector, including support for active modes of transport like biking and walking and for public
transport, particularly rail. There are measures to drive the electrification of public andprivate transport, including accelerated deployment of EV charging infrastructure and areform of the company car tax scheme geared towards electrification. Several measures
support the production, transportation and use of hydrogen production based on
renewable energy, with a goal for Belgium to reach at least 150 MW of electrolysis capacity
by 2025. The plan also supports CCUS, including cross-boarder infrastructure for CO2transportation.
The European Commission provided an overall positive endorsement of Belgium’s planand noted that it should have a positive economic impact and drive public and private
investments in areas relevant for Belgium’s energy and climate goals. However, theEuropean Commission pointed out that the plan has limited investments in renewableenergy and indicated that additional funding and measures beyond what is detailed in theplan are needed to achieve Belgium’s 2030 renewable energy targets.

In 2017, the energy ministers of Belgium’s federal and regional governments reached anagreement on a Belgian Inter-federal Energy Pact, which is a common vision for Belgium’s
energy transition to 2030. The Energy Pact guides co-operation on energy policy and wasan input for developing the National Energy and Climate Plan, Belgium’s main energy andclimate policy document through 2030. However, both the Energy Pact and the NECP
often lack a coherent national perspective. For example, for some energy topics, it can be
unclear how the various federal and regional policies and measures will interact with each
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Assessment

2. GENERAL ENERGY POLICY

other or exactly how the combined efforts of the federal and regional governments support
the achievement of national-level targets. The federal and regional governments should
consider developing a new Energy Pact and/or using the update of the NECP in 2023 topresent a clear and more coherent path to the achievement of national targets andlong-term goals.
Belgium’s energy and climate policy is driven by 2020 and 2030 targets for GHG emissions
reductions, energy efficiency and renewable energy that support EU-wide targets. A policy
agreement signed in 2018 on burden sharing divides responsibility between the federal
and regional governments for Belgium’s 2020 targets on non-ETS GHG emissions
reduction and renewable energy. Under this agreement, each entity is responsible forreaching its assigned targets, which are then added up to form Belgian’s contribution to
the EU-wide targets. Belgium has mixed performance on the achievement of its 2020
targets: the energy efficiency targets were not achieved and achievement of the renewableenergy target required purchasing statistical renewable energy transfers from other EU
member states. The federal and regional governments are still working to to finalise a new
burden-sharing agreement to allocate Belgium’s contributions to the 2030 EU-widetargets. The IEA recommends examining the factors that led to the mixed performance on
the 2020 targets and use this information when developing the burden-sharing agreement
for the 2030 targets. The new burden-sharing agreement should also use transparent
mechanisms and methodologies, and be concluded in a timely manner to avoid
renegotiations during the implementation period and to give clarity to all stakeholders
involved in its implementation.
In 2021, the EU-wide GHG emissions reduction target for 2030 was increased from 40%
to 55%. This additional ambition at EU level will likely require Belgium to set higher
2030 targets and develop additional measures for GHG emissions reductions, renewableenergy and energy efficiency. More ambitious targets accounting for the EU 55% target
should be included in the new burden-sharing agreement. In addition, these more
ambitious targets and additional measures should be included in the updated draft NECP
requested by the European Commission in 2023. Both steps would help to send a clear
signal to investors.
Belgium is facing near-term challenges related to the security of electricity supply. The
federal government is committed to phasing out most nuclear electricity generation by2025 and has developed a CRM that aims to ensure security of electricity supply as
nuclear generation is reduced. The first CRM auction was conducted in October 2021 andawarded payments to 4.4 GW of capacity, mainly to natural gas (2.0 GW existing and
1.6 GW new), and smaller amounts to existing co-generation, DSR and other technologies.

In light of the Russian invasion of Ukraine and goals to reduce fossil fuel dependency, thefederal government decided in March 2022 to take the necessary steps to extend 2 GW ofnuclear capacity by ten years. The extension of the 2 GW of nuclear capacity requires
notable investments at Belgium’s two nuclear plants and completion of complex regulatory
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The federal government has expressed concerns about the timely deployment of new
projects selected in the CRM. The federal government should closely monitor the CRM
results, including progress on the deployment of new projects selected in the auctions andwork with the regional governments to identify and mitigate risks to timely project
deployment. This includes ensuring that permitting requests for projects and supporting
infrastructure are processed and delivered in a transparent and timely manner.

processes. It is expected that no nuclear generation will be available the winter of 2025-26
and that the steps needed to complete the extension of the 2 GW of capacity will not becompleted until 2026 or later.
Belgium is highly dependent on fossil fuels and the NECP estimates an increasing shareof fossil fuels in Belgium’s energy supply mainly due to a growing use of natural gas (from24.4% of gross consumption in 2020 to 38.9% in 2030). The estimated increase in natural
gas demand and associated GHG emissions results mainly from the expected deploymentof new gas-fired electricity generation resulting from the phase-out of most nuclear
generation and CRM auction. In June 2021, Belgium passed a royal decree making it
mandatory for developers of new gas-fired plants to commit to net zero emissions by 2050
(Moestue, 2021). The IEA commends this step, but recommends developing a moredetailed plan to reduce the climate impacts of any new gas-fired generation, provide clear
guidance to investors and avoid stranded assets.

ENERGY INSIGHTS

2. GENERAL ENERGY POLICY

Belgium’s energy policy emphasises reducing energy poverty and ensuring energy
access. The federal government implemented a social tariff that results in reduced gas
and electricity bills for residential consumers that meet certain socio-economic
requirements. In 2020, 9.7% of electricity consumers and 10% of gas consumers benefited
from the social tariff. The federal Social Heating Fund provides residential consumers thatmeet certain socio-economic criteria with direct payments covering part of the costs foroil-based heating. In 2019, around 5% of all households using heating oil received
payments from the Social Heating Fund. The Flemish government has introduced premiumand loan schemes for building renovation and household appliances. Certain vulnerable
households have extra favourable access to these schemes. The Flemish government
wants to reduce energy poverty by reducing consumption with structural, sustainable,
long-term measures.
While the need to protect vulnerable households is an understandable priority, policy
mechanisms that artificially reduce the cost for energy products distort markets, and canincrease energy consumption and related GHG emissions. The IEA encourages Belgium
to use cost-benefit analysis to examine which support measures best serve the needs ofvulnerable consumers, while minimising market distortions and aligning withdecarbonisation goals. Especially critical are energy efficiency measures, promoting
renewables and improving the comfort of residences. The IEA recommends consulting
renewable and energy efficiency associations along with retail energy suppliers anddistribution network operators when examining options to more effectively address energy
poverty.

The federal government aims to reform federal taxation to make it more climate- andenvironmentally friendly, following the polluter-pays principle and sending price signals
supporting decarbonisation. This process presents an excellent opportunity to address
several issues that will help energy price signals drive investments and behaviours in
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The federal government has committed to developing an action plan to gradually phase out
fossil fuel subsidies, including tax reductions for fossil fuel-powered company cars. The
regional governments have also taken steps to eliminate fossil fuel subsidies, in particularwith the elimination of support for oil-based heating in buildings. However, many of thesemeasures support a conversion to gas heating, when a focus on heat pumps and energy
efficiency would be more effective in reducing emissions. The IEA strongly encourages
the federal and regional governments to quickly eliminate all fossil fuel subsidies.

2. GENERAL ENERGY POLICY

line with Belgium’s climate and energy goals. The tax reform should take a broad
approach that includes eliminating fossil fuel subsidies, reducing electricity prices,
introducing carbon pricing and tackling energy poverty. The reform should beaccelerated and concluded as soon as possible to send a clear signal to investors andconsumers.
Because of numerous non-energy charges on electricity bills, Belgium’s electricity prices
are among the highest in Europe. Electricity is significantly more expensive incomparison to oil and gas. The NECP assigns an important role to electrification for
decarbonising the transport, buildings and industrial sectors. But the high cost ofelectricity limits its ability to compete with other energy carriers and reduces the incentive
on consumers and businesses to invest in the electrification of building heating,transportation, industrial processes and other key areas. Under the current tariffstructure, home heating with electricity is 50% more expensive than heating with natural
gas or fuel oil, even though electric heating is more efficient and less polluting. In
addition, lower electricity prices would improve the situation of vulnerable households
and help to foster industrial competitiveness.
The federal and regional governments, together with energy regulators, should examine
how electricity prices can be reduced in line with efforts to reform energy taxation,
eliminate fossil fuel subsidies, address energy poverty, develop an energy norm anddrive decarbonisation through electrification. One clear option would be to remove
charges that are not related to the generation, transmission and distribution of electricity
from electricity bills and finance the programmes associated with these charges throughthe federal and regional budgets or other means.
Belgium’s National Recovery and Resilience Plan is highly ambitious, with more thanhalf of the investments contributing to Belgium’s climate and energy goals. Under EU
regulations, projects have to be implemented between 2021 and 2026, which may be achallenge, as many projects will take time to prepare and will have to obtain planningand environmental permits from federal and/or regional governments. The IEA
recommends that the federal and regional governments make a strong effort to efficiently
process permitting requests related to the Recovery and Resilience Plan projects.

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There is no legal obligation to consult the Belgian Competition Authority on the designof energy policies. Competitive and well-functioning markets are key for the integrationof renewables and energy efficiency, as well as the active participation of consumers.
The IEA recommends consulting the Belgian Competition Authority in a structuralmanner on energy policy development.

Recommendations
The government of Belgium should:
 Swiftly conclude an agreement between the federal and regional governments onburden sharing of Belgium’s contribution to EU-wide targets for greenhouse gas
emissions reduction, renewables and energy efficiency, while taking into accountlessons learnt from the 2020 agreement and the need for flexibility to react to changes
or unforeseen developments.
 Adopt a common long-term energy vision between the federal and regional
governments and develop holistic and coherent policies and measures that are clearlyaligned with national-level targets and goals.
 Proceed swiftly with the planned fiscal reform to ensure taxation steers consumer andbusiness behaviour towards achieving energy and climate goals, taking into accountthe commitment to phase out fossil fuel subsidies, the recent study on carbon pricing
and the goal to increase electrification.

ENERGY INSIGHTS

2. GENERAL ENERGY POLICY Ensure measures addressing energy poverty foster the use of renewable energy andenergy efficiency improvements, enable a just transition that protects vulnerable
households and makes them part of the energy transition.

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 Prepare scenarios to maintain generation adequacy after 2025 in case the capacity
remuneration mechanism or the planned extension of 2 GW of nuclear generation do
not result in the needed capacity, and work with the regional governments to identify
and mitigate risks to the timely deployment of new energy projects.

2. GENERAL ENERGY POLICY

References
BNDCP (Belgian National Debate on Carbon Pricing) (2018), Carbon Pricing: Gradually
Correcting Prices to Support the Low Carbon Transition,
https://climat.be/doc/National_Carbon_Pricing_Debate_-_Final_Report.pdf.
CNC (Commission Nationale Climat/National Climate Commission) (2020), Belgium's
Long-term Strategy, https://cnc-nkc.be/sites/default/files/report/file/lts_be_en_summary.pdf.
CREG (Commission de Régulation de l’Électricité et du Gaz/Commission for Electricity and
Gas Regulation) (2021), Monitoring report concerning the extension of the application ofsocial electricity and natural gas tariffs to beneficiaries of the increased intervention(web page), https://creg.be/fr/publications/rapport-ra2238.
CREG (2020a), Energy market key figures (web page), https://creg.be/fr/consommateurs/le-marche-de-lenergie/chiffres-cles-du-marche-de-lenergie.
CREG (2020b), Social rate (web page), https://creg.be/fr/consommateur/tarifs-et-prix/tarifsocial.
CREG (2018), Federal contribution (web page),https://creg.be/fr/professionnels/fourniture/cotisation-federale.
EC (European Commission) (2021), Analysis of the Recovery and Resilience Plan ofBelgium, https://ec.europa.eu/info/system/files/com-2021-349_swd_en.pdf.
EC (2020), Assessment of the Final National Energy and Climate Plan of Belgium,https://ec.europa.eu/energy/sites/default/files/documents/staff_working_document_assess
ment_necp_belgium_en.pdf.
EC (2019), National energy and climate plans (web page), https://ec.europa.eu/info/energyclimate-change-environment/implementation-eu-countries/energy-and-climate-governanceand-reporting/national-energy-and-climate-plans_en.
EUR-Lex (European Union Law) (2019), State aid – Belgium – State aid SA.54915(web page), https://eur-lex.europa.eu/legalcontent/EN/TXT/?uri=CELEX%3A52020AS54915.
FPS Economy (2022a), Social tariff for electricity and/or natural gas (web page),https://economie.fgov.be/fr/themes/energie/prix-de-lenergie/tarif-social/tarif-social-pourlelectricite.
FPS Economy (2022b), Social tariff for electricity and natural gas for people benefiting fromincreased intervention (web page), https://economie.fgov.be/fr/themes/energie/prix-delenergie/tarif-social/electricite-etou-gaz-naturel/tarif-social-pour-lelectricite.
FSC (Fonds Social Chauffage/Social Heating Fund) (2004), Social Heating Fund website,
https://fondschauffage.be.
Howe, H. (2021), Belgium is about to acquire two or three gas-fired power plants, The
Cheraw Chronicle (web page), https://thecherawchronicle.com/belgium-is-about-to-acquiretwo-or-three-gas-fired-power-plants.

Moestue, H. (2021), Belgium confirms net-zero criteria for new gas-fired plants, Montel(web page), https://montelnews.com/fr/news/1226215/belgium-confirms-net-zero-criteriafor-new-gas-fired-plants.
Port of Antwerp (2021), International port (web page),https://portofantwerp.com/en/international-port.
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IEA. All rights reserved.

IEA (International Energy Agency) (2022), World Energy Balances (database),https://www.iea.org/data-and-statistics/data-product/world-energy-balances (accessed on
18 February 2022).

Key data
GHG emissions without LULUCF (2019): 116.65 Mt CO2-eq, -19.9% since 2005, -19.9%
since 1990
GHG emissions with LULUCF (2019): 115.6 Mt CO2-eq, -19.4% since 2005, -18.8%
since 1990
Energy-related CO2 emissions (2020):
CO₂ emissions from fuel combustion: 82.7 Mt CO₂, -14% from 2010 to 2019, -8% from 2019
to 2020
CO₂ emissions by fuel: oil 46.4%, natural gas 39.6%, coal 10.3%, non-renewable waste 3.8%
CO₂ emissions by sector: industry 31.7%, buildings 26.4%, transport 25.3%, electricity andheat generation 16.6%
CO₂ intensity per
0.197 kg CO₂/USD)

GDP:

0.179 kg

CO₂/USD(IEA

weighted

averagein

2019:

ENERGY SYSTEM TRANSFORMATION

3. Energy and climate change

Overview
Under EU regulations, Belgium has targets to reduce non-ETS GHG emissions by 15%
by 2020 and by 35% by 2030; both targets are compared to 2005 levels. Belgium will likely
meet its 2020 target, as it overachieved on its trajectory to 2020 to compensate for an
actual shortfall in 2020. In 2021, the 2030 EU-wide GHG emissions reduction target wasincreased from 40% to 55% by 2030 (versus the 1990 level). This additional ambition at
the European level will likely require Belgium to adopt a non-ETS emissions reduction
target for 2030 that is higher than 35%, and to take stronger actions to reduce emissions.

Between 2005 and 2012, Belgium’s GHG emissions excluding land use, land-use change
and forestry (LULUCF) experienced a relatively steady decline, from 146 million tonnes ofCO2-equivalent to 120 million tonnes of CO2 equivalent (Mt CO2-eq). Since 2012,
emissions have been relatively stable and were 117 Mt CO2-eq in 2019 (Figure 3.1).
LULUCF has consistently acted as a carbon sink in Belgium, absorbing around37

IEA. All rights reserved.

Belgium’s climate and energy policies are focused on reducing GHG emissions throughthe deployment of renewables and improving energy efficiency. Belgium’s NECP is the
key document defining climate and energy policies through 2030 and defines the federal
and regional measures to meet the 2030 non-ETS target. The European Commission
estimated that the NECP’s emissions reduction measures would result in a reduction of
34.4% by 2030, just missing Belgium’s target.

3. ENERGY AND CLIMATE CHANGE

1 Mt CO2-eq of emissions each year from 2000 to 2019. The majority of Belgium’s GHG
emissions are energy-related (74% in 2019).

Mt CO2-eq

Figure 3.1 Greenhouse gas emissions by sector in Belgium, 2000-2019
Fugitive emissions

150
130

Waste

110

Agriculture

90

Electricity and heatgeneration
Buildings

70
50
30

Transport

10

Industry- 10

LULUCF
IEA. All rights reserved.

Source: UNFCCC (2021), Greenhouse Gas Inventory Data (database), https://di.unfccc.int/detailed_data_by_party.

Energy-related CO2 emissions
Prior to 2011, Belgium experienced a relatively consistent decline in energy-related CO2
emissions, with the exception of notably higher emissions in 2010 resulting fromabnormally cold weather. Since 2011, emission reductions have slowed (Figure 3.2).
From 2011 to 2019, energy-related emissions fell by just 3.6 Mt CO2 to reach 90 Mt CO2.
In 2020, impacts from the Covid-19 pandemic resulted in energy-related CO2 emissions
dropping by 8% to 83 Mt CO2, with most of this reduction coming from a sharp drop intransportation demand for oil along with a decline of industry demand for coal. In 2020,
industry accounted for the largest share (32%) of energy-related CO2 emissions,followed by buildings (26%), transport (25%), and electricity and heat generation (17%).
Belgium’s energy-related CO2 emissions come mostly from oil (46% in 2020) and naturalgas (40%), while coal accounted for 10% and non-renewable waste just 4%.

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Industry emissions come mainly from gas (53% in 2020) and oil (26%), both of which areused in the refining and petrochemical industries and to meet industrial process heat
demand. Transport sector emissions come mainly from road transport demand for diesel(78% in 2020) and gasoline (21%). Building emissions come mainly from natural gas(52% in 2020) and oil (47%), which are the main fuels for building heating. Belgium’s
share of building emissions from oil was notably higher than the IEA average of 24% in
2019. Electricity emissions come from natural gas (58% in 2020) and from generation
based on gases recovered from coal-fired blast furnaces (28%).

Figure 3.2

120Energy-related CO2 emissions by sector and source in Belgium,
2000-2020

Mt CO₂
Non-renewable
waste

100
80

Natural gas

60
40

Oil

20
Coal

0

IEA. All rights reserved.

60

Mt CO₂Oil

50
40Natural gas

30
Coal

20
10

Non-renewable
waste

0

IEA. All rights reserved.

Energy-related CO2 emissions declined by 7% between 2009 and 2019. Emissions from coaland oil decreased, while natural gas emissions have increased since 2014.

ENERGY SYSTEM TRANSFORMATION

3. ENERGY AND CLIMATE CHANGE

Source: IEA (2022), Greenhouse Gas Emissions from Energy (database), https://www.iea.org/data-andstatistics/data-product/greenhouse-gas-emissions-from-energy.

CO2 emission drivers and carbon intensity

In 2019, the carbon intensity of Belgium’s energy supply was 39.2 tonnes CO2 per
terajoule (t CO2 per TJ), the seventh-lowest among IEA member countries, and lower thanboth the overall IEA average (50.4 t CO2 per TJ) and the average of European IEA
countries (46.2 t CO2 per TJ). The carbon intensity of Belgium’s energy supply is relatively
low thanks to the large role of nuclear energy, which covered 18% of TES and 39% ofelectricity generation in 2020, and renewables, which covered around 9% of TES and 26%
of electricity generation in the same year.

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From 2010 to 2019, total energy-related CO2 emissions in Belgium declined by 7% despite
a 10% growth in GDP per capita and a 6% increase in population (Figure 3.3). This is inline with a 20% reduction in the carbon intensity of the economy (CO2 per GDP) as well
as a decrease of 6% in the carbon intensity of the energy supply mix (CO2 per TES) overthe same period.

3. ENERGY AND CLIMATE CHANGE

Despite having a relatively low-carbon energy supply, Belgium’s carbon intensity of GDP(0.16 kilogrammes [kg] of CO2 per USD in 2019) was higher than all of its neighbouring
countries and higher than the average for European IEA member countries (0.14 kg CO2
per USD). This higher carbon intensity of GDP results from Belgium’s concentration ofheavy industry and the major role of chemical and petrochemicals, which accounted for
59% of industry energy demand in 2019. However, Belgium’s carbon intensity of GDP waslower than the IEA weighted average of 0.2 kg CO2 per USD. This shows the benefit ofBelgium’s low-carbon energy supply in reducing the carbon intensity of economic activity
in the service sector and other areas of the economy with high levels of electrification.

Index 1 = 2000

Figure 3.3 Energy-related CO2 emissions and main drivers in Belgium, 2000-2020
1.4
GDP

1.3
1.2

Population

1.1
1.0

CO
CO2/TES
2/TES

0.9
0.8

CO
CO2
emissions
2 emissions

0.7
0.6
0.5
2000

CO2/GDP
CO2/GDP
2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

IEA. All rights reserved.

Decreasing CO2 emissions and increasing population and GDP per capita show decoupling
between carbon emissions and economic growth in Belgium.
Source: IEA (2022), Greenhouse Gas Emissions from Energy (database), https://www.iea.org/data-andstatistics/data-product/greenhouse-gas-emissions-from-energy.

From 2009 to 2019, the carbon intensity of Belgium’s electricity generation dropped from
215 g CO2 per kilowatt-hour (kWh) to 168 g CO2 per kWh, due to the growth in renewableenergy sources combined with a coal phase-out. In 2019, the emissions intensity ofBelgium’s electricity generation was half of the IEA weighted average (337 g CO2 perkWh), thanks mainly to generation from nuclear and also to increasing generation fromwind and solar PV. Together, nuclear, wind and solar PV accounted for 67% of generationin 2019.
Belgium’s ETS emissions are expected to increase from 42.3 Mt CO2 in 2020 to58.1 Mt CO2 by 2030, mainly because of increased gas-fired generation resulting from thenuclear power phase-out. This would notably increase the carbon intensity of Belgium’s
electricity generation, energy supply and economy.

Like in other EU countries, GHG emissions reduction policy in Belgium is governed by
European regulations. Emissions from large electricity plants and energy-intensive
industrial facilities are regulated under the EU ETS. The ETS uses tradable emissions
allowances to drive emissions reductions at ETS-regulated facilities in the EU, Iceland,
Liechtenstein and Norway. The ETS has targets to reduce emissions from regulated
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Climate targets

facilities by 21% by 2020 and 43% by 2030 (both versus 2005 levels). All other emissions(non-ETS) are governed by national targets that are agreed within the EU.
Belgium has targets to reduce non-ETS GHG emissions by 15% by 2020 under the EU
Effort Sharing Decision (ESD) and by 35% by 2030 under the EU Effort Sharing Regulation(ESR). Both targets are reductions versus 2005 levels. The ESD and ESR set non-ETS
targets in all EU member states and in combination with the ETS targets aim for a 20%
reduction in EU-wide GHG emissions by 2020 and a 40% reduction by 2030 (both versus
1990 levels).
This division of responsibility to achieve the 2020 emissions reduction target was divided
between the federal and regional governments through a burden-sharing agreement
adopted in 2018. The federal and regional governments are still in the process ofdeveloping a new burden-sharing agreement for the emissions reductions required to meetthe 2030 targets.
Most of Belgium’s GHG emissions are, however, not covered by the ETS. In 2019, 62% of
Belgium’s GHG emissions were from non-ETS sources, with the largest shares comingfrom transport (36%) and buildings (30%) (EEA, 2021). In 2019, Belgium achieved an 8.8%
reduction in non-ETS emissions versus 2005 levels. However, Belgium will meet its
2020 target of a 15% reduction versus 2005 under EU accounting rules that allow credits
from years when emissions were below annual targets to offset deficits for years whenemissions exceeded annual targets (Table 3.1). From 2013 to 2018, Belgium’s validated
emissions were below the annual target every year except for 2016 and 2018; however,
the excess emissions in 2016 and 2018 were offset by credits from surpassing the target
in other years, and Belgium expects that these credits will cover any excess emissions
in 2019 and 2020 (Climat.Be, 2020).
Table 3.1 Belgium’s non-ETS greenhouse gas emissions and targets, 2013-2020
Non-ETS emissions (Mt CO2-eq)
Annual emissions target
Validated annual emissions
Emissions over (+) or under (-)
targetNet credits to offset emissions

2013
78.4
74.3

2014
76.9
70.1

2015
75.3
72.7

2016
73.8
74.1

2017
72.5
70.8

2018
71.1
74.3

2019
69.7
72.0

2020
68.2
66.7

-4.1

-6.8

-2.6

0.3

-1.7

3.2

2.3

-1.5

4.1

10.9

13.5

13.2

14.9

11.7

9.4

7.9

ENERGY SYSTEM TRANSFORMATION

3. ENERGY AND CLIMATE CHANGE

It is likely that Belgium will need to increase the ambition of its 2030 targets for non-ETS
emissions, renewable energy and energy efficiency to help achieve the new EU-wide
55% GHG reduction target.

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In October 2020, the European Commission commented on Belgium’s NECP, noting thatthe implementation of the NECP’s emissions reduction measures would result in a
reduction of 34.4% by 2030, just missing Belgium’s target. In 2021, the 2030 EU-wide
GHG emissions reduction target was increased from 40% to 55%. The legislative package
proposed by the European Commission in July 2021 is intended to revise several piecesof EU climate legislation, including the ETS and ESR, to align with the 55% target. In theEuropean Commission’s proposal, Belgium’s emissions reduction target for sectors
covered by the ESR (non-ETS) is set to -47% by 2030 in relation to 2005 levels.

3. ENERGY AND CLIMATE CHANGE

As an EU member state, Belgium is a signatory to the United Nations Framework
Convention on Climate Change (UNFCCC) and reports GHG emissions annually to the
UNFCCC to show its contribution to EU-wide emissions reductions under the Paris
Agreement. In March 2020, the EU sent a long-term strategy to the UNFCCC committing
to EU carbon neutrality by 2050. Belgium supports EU carbon neutrality by 2050 and under
EU requirements has adopted its own long-term strategy for energy and climate(LTS2050). The LTS2050 aims to put Belgium on a path that supports the Paris Agreementand EU 2050 carbon neutrality, but it does not include a clear target for national climate
neutrality by 2050 (CNC, 2020).
The LTS2050 is based on the long-term strategies of the regional governments. The
Long-term Strategy of Wallonia aims to achieve carbon neutrality by 2050 through areduction of GHG emissions by 95% compared to 1990, supplemented by CCUS andnegative emissions. The Long-term Strategy of Flanders aims to reduce GHG emissions
from non-ETS sectors by 85% by 2050 (versus 2005), with the ambition to move towards
carbon neutrality. The Climate Ordinance of the Brussels-Capital Region aims reduce
GHG emissions by 90% by 2050 (versus 2005). The LTS2050 contains an estimation of
the expected emissions reduction resulting from the implementation the three regional
strategies (Table 3.2).
Table 3.2 Belgium’s estimated emissions reductions under the LTS2050
Emission source

Reduction in 2050 versus 2005
-100%

Electricity-100%

Transport
Industry (non-ETS)-76% to -83%

Buildings-89% to -91%

Agriculture-45% to -51%

Waste

-95% to -98%

Total non-ETS-85% to -87%

Climate policy

The NECP is Belgium’s main climate policy document, defining the emissions reductions
measures to be implemented by the federal and regional governments to achieve the 2030
emissions reduction target. The NECP measures are focused on reducing energy demand(see Chapter 4) and increasing the deployment of renewable energy, especially forelectricity generation and transport (see Chapter 5). Most of Belgium’s emissions
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Responsibility for climate policy is divided between the federal and regional governmentswith co-ordination of climate policy through the National Climate Commission (NCC) andthe Coordination Committee for International Environmental Policy (CCIEP). The NCC
advises the CCIEP and other government entities on climate issues and approves reports
to the EU and the UNFCCC. The NCC also evaluates co-operation between the federal
and regional governments and the implementation and environmental, social andeconomic impacts of the NECP’s policies and measures. The CCIEP enables Belgium topresent a unified national perspective on environmental matters (including climate) withininternational organisations, including the EU and the UNFCCC. The CCIEP includes
steering and working groups on climate change.

reductions measures are implemented by the regional governments, which have
responsibility for most policy for renewable energy and energy efficiency (except for federalbuildings and fleets). The federal government also plays a role in driving emissions
reductions, notably by setting policy for offshore energy, investments in rail transport,
product policy (ecodesign), fiscal measures, and by exchanging technical expertise andother support with the regional governments.
Emissions reductions from electricity generation are promoted mainly through the ETS andprogrammes that require electricity suppliers to obtain green certificates that are linked toelectricity generated from renewables. There are four separate green certificate
programmes (one for the federal government covering offshore wind generation and one
for each of the three regional governments covering a range of technologies). There are
additional programmes supporting the deployment of small-scale distributed renewables(see Chapter 5).
Emissions reductions from transport are promoted mainly through vehicle taxation thatfavours the adoption of low-emission vehicles and EVs. The regional governments are
responsible for the registration tax (paid once at the purchase of a vehicle) and the vehicle
tax (paid annually). In all regions, these taxes are proportionate to a vehicle’s emissions
and EVs are exempted, providing financial incentives to purchase low-emission vehicles
and EVs. The system for taxing company cars also favours low-emission vehicles andEVs, and there are numerous programmes and measures to reduce transport emissions
through modal shifts (see Chapter 4).
Regional governments have the main responsibility for reducing emissions from buildings,
with policy focused on energy efficiency and to a smaller degree distributed renewableenergy. The federal government is mainly focused on reducing emissions from federalbuildings, but also contributes through setting appliance efficiency standards. There is awide variety of emissions reduction measures for buildings, including direct financial
support, loans, tax deductions, building codes, energy performance certificates andinformation platforms for consumers. There is a notable focus on reducing building
emissions by transitioning away from oil-based heating, with regional programmesfavouring heat pumps and renewables, though in some cases a transition from oil to gas
heating is supported (see Chapters 4 and 10).

ENERGY SYSTEM TRANSFORMATION

3. ENERGY AND CLIMATE CHANGE

Emissions reductions from industry are mainly driven by the ETS and voluntary energy
efficiency agreements between regional governments and industry. The voluntaryagreements vary between regions, but in general focus on audits to identify cost-effectiveenergy efficiency measures, with participating companies receiving reduced taxes or otherincentives if these measures are implemented. The voluntary agreements focus onenergy-intensive industrial facilities, but there is an increasing effort to help SMEs reduce
their emissions (see Chapter 4).

Belgium’s only carbon-pricing mechanism is the EU-mandated ETS. Under current EU
rules, funding equal to at least 50% of ETS allowance revenues must be spent tomodernise the energy system and reduce GHG emissions. Under the current burdensharing agreement, ETS allowance revenues go mostly to the regional governments andare used mainly to support a variety of programmes dedicated to reducing GHG emissions.

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Carbon pricing

3. ENERGY AND CLIMATE CHANGE

Most of Belgium’s GHG emissions are not covered by the ETS. In 2018, the federal
government published a report on the results of a national debate on carbon pricing for
non-ETS sectors. The report included an overview of how carbon pricing has been
implemented in other countries and an analysis of three carbon-pricing trajectories for
non-ETS emissions in Belgium. Each trajectory started at 10 EUR/t CO2 in 2020 andincreased respectively to 40 EUR/t CO2, 70 EUR/t CO2 and 100 EUR/t CO2 in 2030.
The report detailed the impact of the three carbon-pricing options on fossil fuel prices andon emissions from transport, buildings, non-ETS industry and other sectors. The report
indicated that carbon pricing would result in substantial additional tax revenue,
EUR 607 million per year in 2020, increasing to EUR 2 599 million per year in 2030 underthe 2030 price of 70 EUR/t CO2. The report examined budget-neutral redistributions ofcarbon-pricing revenues in ways that are aligned with climate and social policy, forexample by reducing charges and levies on electricity.
The federal government aims to reform federal taxation to make it more climate- andenvironmentally friendly following the polluter-pays principle and sending price signals
supporting decarbonisation. The insights from the report on carbon pricing will be used
when developing options for federal tax reform. In support of this reform, the federal
government will carry out a study in consultation with the regional governments to be
published in 2022. Proposals for fiscal reform based on this study will be made by late2023.

Climate adaptation
Belgium’s National Adaptation Plan 2017-2020 was adopted in 2017 by the NCC(CNC 2017). The plan provides information on adaptation policies and theirimplementation and identifies measures to strengthen institutional co-operation on climate
adaptation and increase climate resilience. The plan addresses six sectors – biodiversity,
crisis management, energy, health, research and international co-operation – and includes
a measure intended to increase security of electricity supply by evaluating climate change
impacts on energy supply, transportation and distribution. In 2020, the NCC commissioned
a study identifying the physical impacts and economic costs resulting from climate change,
including impacts and costs for the energy sector. Belgium is aiming to release an updated
National Adaptation Plan in 2022.

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The regional governments have also developed climate adaptation plans or addressedclimate adaptation in other key planning documents. The Flemish Adaptation Plan
2013-2020 aims to increase understanding of Flanders vulnerability to climate change andimprove the ability to defend against impacts. Flanders is in the process of developing theFlemish Adaptation Plan 2021-2030. In 2016, the Brussels-Capital Region adopted its
integrated Air-Climate-Energy Plan, which includes the main aspects of its adaptation
policy and covers the following areas: infrastructure, forest management, water
management and natural heritage. Some climate adaptation measures are also includedin the Brussels-Capital Region’s thematic plans for the management of water and naturalareas. The Walloon Air-Climate-Energy Plan adopted includes measures on adaptation.

Carbon capture, utilisation and storage
Belgium sees long-term potential for CCUS, primarily through co-operation with its
neighbouring countries. Belgium’s National Recovery and Resilience Plan (developed aspart of the EU response to the Covid-19 pandemic) calls for investments in CCUS
infrastructure. However, Belgium does not have a national CCUS strategy and thecapacities of potential CO2 storage sites are largely uncertain. Flanders and Wallonia havetransposed the EU CCS Directive, which regulates subsurface activities below 500 metresand creates a legal framework for CO2 storage. However, no exploration licences orstorage permits for CO2 have been requested or granted. Neither the Brussels-Capital
Region nor the federal government (which regulates Belgium’s offshore subsurface) havetransposed the EU CCS Directive, and CO2 storage in these regions has been evaluatedas infeasible due to geological conditions.
Because there is no readily available CO2 storage potential, Belgium depends on
co-operation with its neighbouring countries for implementing CCUS projects. There areseveral projects examining the development of CO2 transport infrastructure to allow accessto CO2 storage in other countries. In 2020, the CO2TransPorts project was approved as
an EU project of common interest. It aims to develop CO2 transport infrastructure
connecting the Port of Antwerp, the North Sea Port (serving Ghent, Terneuzen, Borsele
and Vlissingen) and the Port of Rotterdam, which is developing CO2 storage capacity
through the Porthos project. The CO2TransPorts project aims for a transport capacity up
to 10 Mt CO2 per year by 2026, with increased capacity planned after 2030 (EC, 2021a).
Belgium also participates in the Northern Lights EU project of common interest, which
supports projects in Belgium, France, Ireland, the Netherlands, Sweden and theUnited Kingdom to develop infrastructure to transport captured CO2 by ship to offshore
storage in Norway (EC, 2021b). Under the Antwerp@C project, a consortium of privatecompanies is investigating CO2 capture and transport infrastructure in the Port of Antwerp.
The consortium aims to reduce the CO2 emissions from the port by up to 50% by 2030.
The Antwerp@C project is linked to the CO2TransPorts and Northern Lights projects(Hakirevic, 2020).

ENERGY SYSTEM TRANSFORMATION

3. ENERGY AND CLIMATE CHANGE

The Low Emissions Intensity Lime & Cement (LEILAC) project, ongoing in Wallonia since2016, is supported by the EU and aims to enable the cement and lime industries to capture
CO2 emissions from the processing of limestone. A pilot plant is operating at a cement
plant in Belgium. Several Belgian companies are involved in the follow-up project,
LEILAC2, where a demonstration-scale capture installation will be built at a German
cement plant (LEILAC, 2020). In December 2020, a joint development agreement was
concluded in Wallonia on a project that aims to convert the CO2 generated during lime
production into methane. The project will demonstrate a process combining carbon
capture and a 75 MW electrolyser.

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Belgium supports research to reduce the costs of CCUS and is hosting or participating inseveral pilot and demonstration projects for CCUS. At the North Sea Port, 20 public andindustrial partners (including a large steel plant located in Ghent) have joined forces in the
North-CCU-Hub, which is focused on developing CCU to reduce the port’s emissions(North-CCU-Hub, 2022). The Balmatt deep geothermal pilot project installed direct air
capture on the air-cooling units of the geothermal plant in 2018 (Vito, 2018).

3. ENERGY AND CLIMATE CHANGE

Assessment
Under EU regulations, Belgium has targets to reduce non-ETS GHG emissions by 15%
by 2020 and by 35% by 2030; both targets are compared to 2005 levels and are intended
to support EU-wide emissions reduction targets. Belgium’s climate and energy policies
focus on reducing GHG emissions through the deployment of renewables and improving
energy efficiency. Belgium’s NECP is the key document defining climate and energy
policies through 2030 and defines the federal and regional measures to meet the 2030
non-ETS target. The European Commission estimated that the NECP’s emissions
reduction measures would result in a reduction of 34.4% by 2030, just missing Belgium’s
target.
In 2021, the 2030 EU-wide GHG emissions reduction target was increased from 40% to55%. This additional ambition at the European level will likely require Belgium to adopt ahigher 2030 non-ETS emissions reduction target and to take stronger actions to reduce
emissions, which have seen only limited declines in recent years. Belgium should include
any changes in targets and measures needed to support the increased EU-wide GHG
target in the draft NECP update due in 2023.
The ETS regulates GHG emissions from Belgium’s large power plants andenergy-intensive industrial facilities. According to the NECP, Belgium’s ETS emissions are
expected to increase from 42.3 Mt CO2 in 2020 to 58.1 Mt CO2 by 2030, mainly due toincreased gas-fired generation resulting from the nuclear power phase-out. The
government has estimated that gas-fired generation could increase to over 60% of total
electricity generation by 2025, from just 28% in 2019. This would increase EU-wide ETS
emissions and require a higher level of emissions reductions from ETS facilities in otherEU member states to achieve the EU-wide 2030 ETS emissions reductions target.
Other than the ETS, Belgium does not have a carbon-pricing mechanism. The federal
government conducted a national debate on carbon pricing for the non-ETS sectors and areport on the debate was published in 2018. The federal government aims to propose
reforms to federal taxation in late 2023 to make it more climate- and environmentallyfriendly following the polluter-pays principle and sending price signals supporting
decarbonisation. The reform of taxation presents an excellent opportunity for implementing
a broad carbon price to send clear signals to investors and consumers. The government
should use the 2018 report on carbon pricing to inform the development of carbon-pricing
options and should accelerate the schedule for reforming federal taxation to support
decarbonisation.

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Belgium has made progress on the policy recommendations of the last IEA energy policy
review conducted in 2016. The federal and regional governments implemented therecommendation to reach a political agreement on burden sharing of Belgium’s 2020
climate and energy targets. The agreement has a detailed description of the governanceto achieve the non-ETS emissions reduction target and the renewable energy target. Inline with the IEA’s recommendations, the burden-sharing agreement included mechanisms
to co-ordinate the use of flexible instruments between the federal and regional
governments, including international carbon credits.

However, the burden-sharing agreement was only signed in 2018, just two years before
the 2020 target, missing the opportunity to send robust signals to investors. The long delay
to conclude an agreement on how non-ETS emissions reductions would be divided
between the regions reduced clarity on the level of emissions reductions required in eachregion, depriving investors of clear signals on where to direct funding for the projects andinvestments needed to reduce emissions.
The federal and regional governments noted that the burden-sharing agreement’s
methodologies to estimate GHG emissions inventories are broadly harmonised between
the regions, but that there remain differences in how the impact of policies and measuresare estimated. The NCC has not yet agreed on a methodology to estimate how new federal
policies will impact emissions at the regional level.
The federal and regional governments have taken preliminary steps to develop a new
burden-sharing agreement covering Belgium’s 2030 non-ETS emissions reduction target.
In 2017, the NCC launched preparations for a new burden-sharing agreement for theperiod 2021-2030. The NCC agreed in December 2020 to aim for a political decision by
November 2021. When preparing a new burden-sharing agreement, Belgium should
consider lessons learnt from previous agreements, including improving flexibility torespond to changing circumstances (e.g. potential for increased ambition at the EU orinternational level), setting targets based on shares instead of absolute values, and using
cost-effectiveness as a criteria at a national rather than separately at the federal andregional levels. The new burden-sharing agreement should account for the increased EU
55% emissions reduction target and be concluded as quickly as possible to give investors
clear signals on the needed level of ambition and on where to direct funding for the projects
needed to reduce emissions.
The EU has set a goal for carbon neutrality by 2050. Belgium supports EU carbon
neutrality by 2050 and under the EU requirement submitted a national long-term strategy
for energy and climate to the European Commission in February 2020. However, thestrategy does not include long-term national emissions reduction targets, nor does it
include a clear commitment to carbon neutrality in Belgium by 2050. Belgium is
encouraged to adopt national long-term emissions reductions targets for the period
2030-2050 to provide a clear signal to investors and to set a clear national goal for carbon
neutrality by 2050 at the latest.

ENERGY SYSTEM TRANSFORMATION

3. ENERGY AND CLIMATE CHANGE

GHG emissions from Belgium’s industry sector have been increasing, despite higher
carbon prices in the ETS and ongoing agreements between the regional governments andindustry to implement efficiency measures. More effort is needed on policies and measures
to ensure that Belgium’s industry can significantly lower emissions in line with 2030 targets
while remaining economically competitive. Voluntary agreements with industry should
push for accelerated implementation of cost-effective emissions reductions and it may
also be necessary to provide subsidies for industrial decarbonisation (e.g. through47

IEA. All rights reserved.

The federal government has approved an instrument to track the progress of the federal
policies and measures, sharing the responsibility to achieve targets among all federal
ministers. The Flemish government has introduced a similar mechanism to track progress
and allocate responsibilities across the different Flemish ministers. The IEA encourages
the federal and regional governments to develop a common methodology for estimating
and monitoring the impact of policies and for increasing transparency on how targets will
be met.

3. ENERGY AND CLIMATE CHANGE

electrification, electrolysers and CCUS), to drive the needed emissions reductions andmaintain industrial cost competitiveness.
Belgium’s National Adaptation Plan 2017-2020 provides information on adaptation policies
and their implementation, and identifies measures that need to be taken to strengthen
institutional co-operation on climate adaptation and increase climate resilience. One of themeasures that was successfully implemented was a study of the socio-economic impactsof climate change in Belgium, which estimated that climate change impacts in 2050 would
have an economic cost of about EUR 9.5 billon, or 2% of Belgium’s GDP, while benefits
are equal to 0.65% of GDP under the worst-case scenario. Another action, to “undertakea study into the impact of climate change on energy security”, was never commissioned,
as CONCERE/ENOVER concluded that the European Environment Agency study entitled
Adaptation Challenges and Opportunities for the European Energy System contained all
the information needed. The European Environment Agency study suggests that theenergy sector needs to strengthen its climate resilience. The NCC has decided to update
the National Adaptation Plan. The IEA encourages Belgium to adopt a National Adaptation
Plan for 2021-2030 that clearly addresses the climate impacts on the energy sector.

Recommendations
The government of Belgium should:
 Update the National Energy and Climate Plan with new targets and measures that
support the EU’s 55% emissions reduction target and provide long-term certainty to
stakeholders for making the necessary investments for decarbonisation.
 Agree as soon as possible on internal burden sharing for the period 2021-2030, taking
into account the EU’s 55% emissions reduction target and the lessons from theprevious burden-sharing agreement.
 Agree on long-term climate and energy targets at a national level for the period
2030-2050, including a national 2050 carbon neutrality target, as part of a stable
regulatory framework to provide clarity to investors and consumers.

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 Use the reform of taxation to create appropriate price signals to drive decarbonisation
across the entire economy.

References
Climat.Be (2020), Emissions from the non-ETS sector (web page), https://climat.be/enbelgique/climat-et-emissions/emissions-des-gaz-a-effet-de-serre/secteur-non-ets.
CNC (National Climate Commision) (2020), Belgium's Long-term Strategy, https://cncnkc.be/sites/default/files/report/file/lts_be_en_summary.pdf.
CNC (2017), Belgian National Adaptation Plan 2017-2020, https://cncnkc.be/sites/default/files/report/file/nap_en.pdf.
EC (European Commission) (2021a), Candidate PCI Projects in Cross-border Carbon
Dioxide (CO2) Transport Networks,
https://ec.europa.eu/info/sites/default/files/detailed_information_regarding_the_candidate_p
rojects_in_co2_network_0.pdf.
EC (2021b), Northern Lights Project,https://ec.europa.eu/energy/maps/pci_fiches/PciFiche_12.4.pdf.
EEA (European Environment Agency) (2021), EEA Greenhouse Gas Projections(database), https://eea.europa.eu/data-and-maps/data/data-viewers/eea-greenhouse-gasprojections-data-viewer (accessed on 23 February 2022).
Hakirevic, N. (2020), Port of Antwerp: CO2 reduction project wins EU funding, Offshore
Energy (web page), https://offshore-energy.biz/port-of-antwerp-co2-reduction-project-winseu-funding.
IEA (International Energy Agency) (2022), Greenhouse Gas Emissions from Energy(database), https://www.iea.org/data-and-statistics/data-product/greenhouse-gasemissions-from-energy (accessed on 23 February 2022).
LEILAC (Low Emissions Intensity Lime & Cement) (2020), About LEILAC (web page),https:// project-leilac.eu/leilac-pilot-plant.
North-CCU-Hub (2021), North-CCU-Hub website, https://northccuhub.eu.

ENERGY SYSTEM TRANSFORMATION

3. ENERGY AND CLIMATE CHANGE

UNFCCC (United Nations Framework Convention on Climate Change) (2022), Greenhouse
Gas Inventory Data (database), https://di.unfccc.int/detailed_data_by_party (accessed on
23 February 2022).

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Vito (2018), Impact of carbon capture and reuse (web page),https://vito.be/en/impact/carbon-capture-and-reuse.

Key data (2020)
TFC: 38.0 Mtoe (oil 45.7%, natural gas 26.8%, electricity 17.9%, bioenergy and waste 5.5%,
heat 1.2%, coal 1.0%), -6.0% from 2010 to 2019, -5.2% from 2019 to 2020
TFC by sector: industry 47.6%, buildings 32.2%, transport 20.2%
TFC per capita: 3.3 toe/capita (IEA average in 2019: 2.90 toe/capita), -15.6% since 2010
TFC per GDP: 73 toe/USD million (IEA average in 2019: 65 toe/USD million), -16.1%
since 2010

Overview
From 2010 to 2019, Belgium’s GDP increased by 14%, while its population increased by
5% (Figure 4.1). Despite marked increases in GDP and population, TFC decreased by 6%
between 2010 and 2019, and the energy intensity of Belgium’s economy (TFC per GDP)decreased by 17%, showing decoupling between economic growth and energy demand.
However, in 2019, the energy intensity of Belgium’s economy (72 toe/USD million) was
the sixth-highest among IEA member countries.

ENERGY SYSTEM TRANSFORMATION

4. Energy efficiency

Index 1 = 2000

Figure 4.1 Energy demand and drivers in Belgium, 2000-2020
1.4
GDP

1.3
1.2

Population

1.1
1.0
0.9

TFC

0.8
0.7
2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

IEA. All rights reserved.

The TFC/GDP ratio decreased by 16% between 2010 and 2020, showing decoupling
between energy demand and economic growth.
Source: IEA (2022a), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances.

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0.6
2000

TFC/GDP4. ENERGY EFFICIENCYIn 2020, TFC decreased by 5.2% with respect to 2019 due to the effects of the Covid-19
pandemic, with most of the reduction coming from the transport sector (-13.2%), followed
by industry (-4.3%) and buildings (-0.9%).
In line with EU regulations, Belgium set indicative targets for primary and final energy
consumption for 2020 and 2030. Belgium’s 2020 indicative target for primary energy
consumption (PEC) was 43.7 Mtoe and the indicative target for final energy consumption(FEC) was 32.5 Mtoe. In 2020, Belgium’s PEC was 43.9 Mtoe and FEC was 33.3 Mtoe.
The decrease of PEC and FEC in 2020 was mainly caused by the Covid-19 pandemic,
and the expected rebound of energy demand in 2021 will likely bring Belgium’s PEC and
FEC higher than the 2020 targets.
Looking ahead to 2030, Belgium has indicative targets for PEC of 42.7 Mtoe and for FEC
of 35.2 Mtoe. These indicative targets require an update with increased ambitions to
support the recent commitment from EU to reduce its GHG emissions by 55% by 2030,
with respect to 1990 levels. In light of this, the government should assess why measuresand policies did not achieve the desired reductions of energy demand by 2020, and use
the lessons learnt to implement more effective policies to improve energy efficiency in all
sectors in the next decade.

Energy demand by sector
In 2020, Belgium’s energy demand was 38 Mtoe, with the largest share from industry(48% of TFC), followed by buildings (32% in total, with 21% from residential buildings and
12% from service sector buildings) and transport (20%) (Figure 4.2).
Figure 4.2 Energy demand by sector in Belgium, 2000-2020
45

Mtoe
Service sector
buildings

40
35
30

Residentialbuildings

25
20

Transport

15
10

Industry

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Energy demand fluctuated around 40 Mtoe between 2009 and 2019, and dropped in 2020
due to Covid-19. The largest share comes from industry (48% in 2020).

From 2010 to 2020, Belgium’s energy demand (TFC) consistently fluctuated, reaching a
low of 39 Mtoe in 2009 and a high of 43 Mtoe in 2010, when an exceptionally cold winterincreased energy demand in the buildings sector. The drop to 38 Mtoe in 2020 was caused
mainly by the effects of the Covid-19 pandemic.
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Source: IEA (2022a), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances.

Industry
Industry energy demand (including feedstocks) was relatively stable from 2014 to 2018, ataround 19.5 Mtoe, then started to decrease in 2019 and dropped again in 2020 when itwas 18.1 Mtoe (Figure 4.3). Due to the presence of a large chemical and petrochemical
sector, oil covers the largest share of industry energy demand (40% of industry TFC
in 2020), followed by natural gas (29%) and electricity (18%). Coal is used mainly in theiron and steel sector and accounted for 2% of industry TFC in 2019, while bioenergy(mainly solid biomass) accounted for 5%.
Figure 4.3 Industry energy demand by source in Belgium, 2000-2020
20

Mtoe
Heat

18
16

Electricity

14
12

Bioenergy and waste

10
8

Coal

6
4

Natural gas

2

Oil

0

IEA. All rights reserved.

Industry energy demand fluctuated around 19.5 Mtoe between 2013 and 2018, droppingin 2019 and 2020. Oil covered 40% of TFC in 2020, followed by natural gas and electricity.
Source: IEA (2022a), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances.

ENERGY SYSTEM TRANSFORMATION

4. ENERGY EFFICIENCY

The chemical and petrochemical sector accounts for the largest share of industry energy
demand (59% of industry TFC in 2020), followed by food and tobacco (9%); iron and steel(7%); non-metallic minerals (7%); agriculture/forestry (4%); and paper, pulp and print (3%).
The coke and refined petroleum products sector had the largest energy intensity per value
added in 2019 (51 megajoules [MJ] per USD), followed by basic metals (45 MJ/USD) andnon-metallic minerals (19 MJ/USD). Overall, the industry sector’s energy intensity pervalue added decreased by 10% between 2010 and 2019.

Buildings

Most energy demand in residential buildings is covered by natural gas (39% in 2020),
followed by a remarkably high share of heating oil (33%), electricity (21%) and bioenergy(7%). Natural gas plays a key role in covering energy demand also in service sector
buildings (40% in 2020), while electricity covers a higher share (40%) than in residential
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Energy demand in the buildings sector comes mostly from residential buildings (64% ofbuildings TFC in 2020), while service sector buildings (including both commercial andpublic services) accounted for 36%. From 2010 to 2020, buildings sector energy demand
experienced an overall decline, from 15 Mtoe to 12 Mtoe, with notable fluctuations driven
mainly by heating demand (Figure 4.4). While residential building energy demanddecreased from 9.6 Mtoe to 7.8 Mtoe, service sector building energy demand fluctuatedaround 4.5 Mtoe, with a minimum of 4.2 Mtoe in 2014 and a peak of 5.0 Mtoe in 2010.

4. ENERGY EFFICIENCY

buildings and the shares from oil (18%) and bioenergy and waste (2%) are notably lower.
In comparison to many European countries, very little building energy demand in Belgium
is covered by district heating. In 2019, district heating covered just 1% of energy demand
from service sector buildings and just 0.2% of energy demand from residential buildings,
and comes mainly from co-generation or waste plants serving neighbouring service sector
or residential buildings.
Space heating is responsible for most residential buildings energy demand (73% in 2019),
followed by residential appliances (13%), water heating (12%) and cooking (2%)(IEA, 2022b). Most space heating uses natural gas (49% of space heating energy demandin 2019) and oil (37%), followed by bioenergy (10%) and a notably low share of electricity(3%). Oil covers a large share of total building energy demand in Belgium. In 2019, theshare of oil in Belgium’s building energy demand (24%) was the fifth highest among IEA
countries and notably higher than the IEA average of 8%.
Figure 4.4 Total final consumption in the buildings sector by source in Belgium,
2000-2020
Residential buildings
10

Mtoe

Solar

9
8

Bioenergy and waste

7
6

Heat

5
4

Electricity

3
2

Natural gas

1
Oil

0

IEA. All rights reserved.

Service sector buildings
5.0

Mtoe
Solar

4.5
4.0

Bioenergy and waste

3.5

Heat

3.0
2.5

Electricity

2.0

Coal

1.5
1.0

Natural gas

0.5

Oil

0.0

While energy demand in residential buildings decreased on average between 2010 and 2020,
the service sector buildings demand fluctuated around 4.5 Mtoe.
Source: IEA (2022a), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances.

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IEA. All rights reserved.

Transport
Transport sector energy demand was relatively stable at just under 9 Mtoe from 2015 to2019 (Figure 4.5). In 2020, transport energy demand dropped by 13%, mainly because of
the impacts of the Covid-19 pandemic. Most transport energy demand is covered by oil
products, mainly diesel (69% of transport TFC in 2020), followed by gasoline (19%). The
use of biofuels almost doubled from 2010 to 2020 to reach 9% of transport TFC. Biofuelsin Belgium consist mainly of biodiesel and bioethanol. In 2020, electricity accounted for
2% of transport TFC and is used mainly in railways. A very small share of transport demandis covered by natural gas (1%).
The vast majority of domestic transport energy demand comes from road transport (96%in 2019), followed by rail (2%) and shipping (2%). In 2019, passenger cars accounted for
55% of road transport, freight road 38%, buses 2% and motorcycles 1%.
Figure 4.5 Total final consumption in transport by fuel in Belgium, 2000-2020
10

Mtoe
Electricity

98

Bioenergy and waste

76Natural gas

5
4

Other oil

3

Gasoline

2
1

Diesel0

IEA. All rights reserved.

ENERGY SYSTEM TRANSFORMATION

4. ENERGY EFFICIENCYTransport demand in 2019 was at a level similar to that in 2009, but with a decreasing trend
since 2016. The 2020 drop is caused by the Covid-19 pandemic. Biofuels and gasoline
increased, with a decreasing share of diesel.
Source: IEA (2022a), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances.

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EV deployment is increasing in Belgium (Figure 4.6). From 2012 to 2021, the number ofregistered EVs grew from just 1 163 to almost 180 000, to reach 3.1% of the total
passenger car fleet compared to 1.5% in the EU. In 2020, new EV registrations reached
48 000, or 8.6% of annual new vehicle registrations. Most of this growth has come fromplug-in hybrid electric vehicles (PHEV), with around 75 000 registered PHEVs in 2020,
while battery electric vehicle registrations reached around 34 000 in the same year. There
has also been strong growth in EV charging infrastructure. From 2013 to 2021, the numberof publicly available charging points grew from just 378 to 12 816 (EAFO, 2019).

4. ENERGY EFFICIENCY

200 000

14 000180 000

12 000160 000
140 000

10 000120 000

8 000

100 000
80 0006 000

60 0004 000

40 000BEV

PHEV

Charging
points2 000

20 0000Charging points

EV fleet

Figure 4.6 Registered electric vehicles and public charging points in Belgium,
2012-2021

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

0
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Sales of electric vehicles are rapidly increasing in Belgium, with plug-in hybrids making up thelargest share. Deployment of charging infrastructure has also increased in recent years.
Note: BEV = battery electric vehicle.
Source: EAFO (2022), Belgium (database), https://eafo.eu/countries/belgium/1724/summary.

Energy efficiency targets
Belgium’s 2020 and 2030 energy efficiency targets are driven by the EU Energy Efficiency
Directive (EED). Under the EED, each EU member state sets indicative national energy
efficiency targets to contribute to the EU-wide 2020 target of a 20% reduction in energy
consumption compared to a business-as-usual projection. Belgium has 2020 indicative
targets to reduce PEC to 43.7 Mtoe and FEC to 32.5 Mtoe (Figure 4.7). Despite a large
and likely temporary reduction in energy demand resulting from the pandemic, Belgium
did not meet its 2020 indicative energy efficiency targets. In 2020, PEC was 43.9 Mtoe and
FEC was 33.3 Mtoe.

Mtoe

Figure 4.7 Indicative energy efficiency targets for Belgium and status, 2004-2020
55

Primary energy
consumption
(PEC)

50

45

Final energy
consumption
(FEC)

40

PEC targets

35

FEC targets

30
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030

IEA. All rights reserved.

Sources: Eurostat (2022), Complete Energy Balances (database),https://ec.europa.eu/eurostat/databrowser/view/nrg_bal_c/default/table?lang=en; EC (2014), Belgian Energy
Efficiency Action Plan, https://ec.europa.eu/energy/sites/ener/files/documents/Belgium%20NEEAP.pdf; EC (2020),
Belgian Integrated National Energy and Climate Plan, https://energy.ec.europa.eu/system/files/202009/be_final_necp_parta_en_0.pdf.

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Despite the large drop in demand cause by the Covid-19 pandemic, Belgium did not meet its
2020 targets. 2030 targets need to be more ambitious to support the EU-wide commitments.

Energy efficiency policy and measures
The regional governments are responsible for most areas of energy efficiency policy. The
federal government is responsible for energy efficiency policy in several areas, including
federal buildings, federal vehicle fleets, national railways, ecodesign and energy labellingof appliances, and modal-shift measures for federal civil servants. Collaboration on energy
efficiency policy between the federal and regional governments is co-ordinated throughthe ENOVER/CONCERE working group on energy efficiency.
The Belgian tax system provides an increased deduction of 13.5% for energy-saving
investments made by companies. To encourage energy efficiency in buildings, the federal
government reduced the VAT from 21% to 6% for demolition and renovation projects (onlyrenovation in the Brussels-Capital Region). This reduced VAT was limited to 32 urban
areas, but has been extended temporarily from January 2021 to December 2022 to coverprojects that satisfy certain conditions in all of Belgium. In Flanders, projects that are notentitled to the VAT reduction can apply for a regional premium for demolition andrenovation.
The federal government holds responsibility for the implementation of EU legislation on
ecodesign and labelling of appliances. Belgium is also implementing Article 6 of the EED,
which regulates energy performance in relation to public procurement of products, services
and buildings. Article 7 of the EED requires EU member states to reduce energy sales to
final consumers by 1.5% annually through 2020, using an energy efficiency obligation
scheme or alternative measures. In line with Article 7, Belgium set a target to achieve
cumulative energy savings of 6 911 kilotonnes of oil equivalent (ktoe) by 2020 using
alternative measures. As of 2018, Belgium had reached 4 510 ktoe of cumulative energy
savings and expects to achieve its 2020 target. The EED was amended in 2018 to extend
Article 7 to require annual savings of at least 0.8% of final energy consumption each year
from 2021 to 2030. In line with the directive, Belgium’s NECP sets the cumulative savings
target of 185 TWh (15.9 Mtoe) by 2030. The federal government, Flanders, Wallonia andthe Brussels-Capital Region will all contribute to achieving the 2030 target.
Flanders, the Brussels-Capital Region and Wallonia have implemented Article 8 of theEED, which requires large companies to conduct energy audits of industrial facilities andbuildings. Audits must be conducted by regionally accredited auditors, meet minimal
quality requirements, cover at least 80% of the company’s energy demand and be renewed
every four years. In Flanders, auditors are not accredited regionally and can be internal orexternal energy experts, but the minimum energy value of the audit is regulated andmonitored. In this region, all large companies had to carry out a first energy audit in 2015
and a second one by the end of 2020. Wallonia introduced a mandatory audit for large
enterprises in 2016. In the Brussels-Capital Region, there is a requirement for energy
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Belgium’s NECP set 2030 energy efficiency indicative targets for PEC of 42.7 Mtoe andfor FEC of 35.2 Mtoe. These indicative targets are intended to support the achievement of
the EED 2030 target of a 32.5% reduction in EU-wide energy consumption compared to abusiness-as-usual projection. However, the EU recently released a proposal for increasing
the EU-wide PEC and FEC reductions to 39% and 36% respectively, to support its
commitment to achieve a 55% reduction of GHG by 2030 compareds to 1990 levels. To
support the EU-wide binding energy efficiency target, member states will be required toincrease the ambition of their national PEC and FEC indicative targets.

ENERGY SYSTEM TRANSFORMATION

4. ENERGY EFFICIENCY

4. ENERGY EFFICIENCY

audits for large companies applying for environmental permits. Grants are available tocover some of the expenses for implementing the audit recommendations. In Flanders, allcost-effective measures (based on internal rate of return) must be implemented.

Industry
The main measures to improve industrial energy efficiency are voluntary energy
agreements between the regional government and industrial companies active in Flanders
and in Wallonia. In Flanders, the voluntary agreements cover energy-intensive industrial
companies (those with annual primary energy demand higher than 0.1 petajoule) andrequire companies to implement an energy management system or to get ISO 50001
certification. As of 2020, 98% of energy-intensive industrial companies in Flanders had
implemented an energy management system. The Flemish government also has voluntaryagreements with groups of SMEs per industry sector, which appoint an energy coach toassist SMEs in performing energy audits, identify energy efficiency measures, monitor
implementation of measures and apply for subsidies. Flanders also has a variety of grant
programmes to support industrial energy efficiency projects.
Voluntary agreements in Wallonia require targets for energy efficiency and GHG emissions
reductions, annual progress monitoring, specific studies (including for renewable energy
investments), and a carbon-footprint analysis. Industrial federations integrate the individualenergy efficiency and GHG emissions targets of their member companies into targets foreach industry sector that become an official commitment between the federations andWallonia. The federations also issue low-carbon road maps for each industry sector.
Fourteen federations representing 228 companies and 90% of Walloon industrial energy
demand are participating in the second round of voluntary agreements. The regional
voluntary agreement targets for 2020 were achieved and the agreements were extended,with new targets through 2023 to allow time to prepare a third round aiming to drive atransition towards a low-carbon economy.
Wallonia’s government supports the Easy Green programme, which provides technicaladvice and loans up to EUR 1 million per project and EUR 3 million per company to help
SMEs reduce energy consumption and GHG emissions, including through renewableenergy projects. The Easy Up programme supports SMEs with loans covering up to 40%
of qualifying costs (up to EUR 500 000) for developing innovative processes or services
related to energy transition. As of April 2021, these two programmes had provided loans
to 54% of Wallonia’s SMEs, for a total of EUR 45 million in financing, supporting
201 projects.

The regional governments are responsible for most energy efficiency policy for buildings
as they set building and zoning codes and run the majority of support programmes related
to improving buildings’ energy efficiency and renovations. The federal government’s roleis limited to federal buildings, ecodesign and energy labelling of appliances. Belgium’s
National Recovery and Resilience Plan allocates EUR 1 billion for energy-efficientrenovation of residential and public buildings, social housing, and higher energy efficiency
subsidies for commercial buildings. The EUR 1.2 billion package of measures to accelerateenergy transition introduced in March 2022 includes specific efforts targeting the building
sector. For example, the VAT on solar PV panels, solar thermal collectors and heat pumps
was reduced to 6% for the years 2022-2023.
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Buildings

Public buildings
Under Article 5 of the EU EED, the federal government has a goal to renovate every year
3% of federally owned and operated buildings with an area greater than 250 m2 that do
not meet minimum energy performance requirements. Renovations of federal buildings
are managed by the Federal Real Estate Manager, which is responsible for the overall
operation and maintenance of most properties owned or rented by the federal government.
Regional governments are also implementing EED Article 5 by renovating 3% of theirgovernment-owned and occupied buildings each year. The regional targets are supportedwith energy management programmes and by energy service companies.
The Flemish Energy Company provides a wide variety of energy-related services forbuildings owned and operated by the Flemish or local governments and buildings ofentities that receive government funding. The Flemish Energy Company provides
consulting services on implementing efficiency and renewable energy projects andaccessing funding and is also an energy supply company for gas and electricity. Flanders
has established the Schools of Tomorrow public-private partnership to provide
investments of around EUR 1 billion to 182 projects to design, build and maintain efficient
new school buildings. In March 2021, 169 projects had been completed.
In Wallonia, the Rational Use of Energy in Public Buildings programme provides subsidies
for the renovation of residential and non-commercial service buildings. It has been
estimated that the full cost of Wallonia’s regional Renovation Strategy is EUR 120 billion
for residential buildings and EUR 34-57 billion for non-commercial service buildings. Under
this programme, a new mechanism to support the Renovation Strategy and a platform tosupport local renovation pilot projects have been developed. RenoWatt is a one-stop shopthat carries out audits and studies supporting service and works contracts for therenovation of public buildings in Wallonia through energy performance contracts.
In the Brussels-Capital Region, the Local Plan for Energy Management provides
management tools to improve the energy efficiency of buildings. Since 2019, participation
is mandatory for both government entities and private companies with large real estate
portfolios; other entities may join voluntarily. The NRClick energy service company
supports efficient energy management of public buildings in the Brussels-Capital Region.
NRClick provides a central purchasing service for energy efficiency measures and tools
for technical analysis, energy accounting and monitoring.

ENERGY SYSTEM TRANSFORMATION

4. ENERGY EFFICIENCY

Private buildings
In Belgium, the Energy Performance Buildings Directive’s standard requirements on global
energy performance, insulation, and indoor air quality and thermal comfort are required for59

IEA. All rights reserved.

The amended EU Energy Performance Buildings Directive requires EU member states totake additional steps to reduce buildings’ energy demand, including the adoption of along-term renovation strategy for a highly energy-efficient and decarbonised building stockby 2050, with milestones for 2030, 2040 and 2050. All three regional governments are
implementing the directive, and have developed long-term renovation strategies andsubmitted them to the European Commission. Under Flanders’ Long-term Renovation
Strategy, public buildings have to achieve carbon neutrality by 2045. For semi-publicbuildings (schools, hospitals, etc.), the target year for carbon neutrality is 2050. Wallonia
aims for carbon neutrality of public buildings by 2040. The federal government aims forcarbon neutrality of federally owned or operated buildings by 2040.

4. ENERGY EFFICIENCY

new buildings. In Wallonia, the last update entered into force in January 2021, requiring
the nearly zero energy building standards for all new buildings.
In Flanders, rational energy use obligations imposed on electricity grid operators require
payments to consumers that invest in certain energy-saving measures in existing
residential and non-residential public and private buildings. Qualifying investments include,inter alia, insulation, high performance windows, solar thermal heating, heat pumps andefficient lighting (for non-residential buildings). In Wallonia, grants (Primes Logement andÉnergie) and 0% loans (Écopack and Rénopack) provide financial support for therenovation of private buildings.
The renovation policy for private buildings in the Brussels-Capital Region relies on threefinancial instruments: 1) energy grants (Primes énergie); 2) Brussels green loan (Prêt vert
bruxellois); and 3) home renovation grants. The Primes Énergie cover up to 70% of thecosts of most energy efficiency investments in buildings, including improvements inheating and insulation and cover the costs of related audits. The Prêt vert bruxellois
provides access to loans with interest rates from 0% to 2% for energy improvements inresidential buildings, including solar photovoltaics, heat pumps, solar heaters andinsulation. The Brussels-Capital Region has several programmes to facilitate deep
renovation of private residential buildings.

Transport
Policies driving energy efficiency in the transport sector consist mainly of price signals tofavour the adoption of electric or low-emission vehicles and to encourage modal shift. The
regional governments are responsible for the registration tax, paid once at the purchaseof a new or used car, and the vehicle tax, paid annually. In all regions, both of these taxes
are proportionate to vehicle emissions, providing financial incentives to purchase lower
emission (and more efficient) vehicles. EVs are exempt from both taxes, while owners ofdiesel or liquefied petroleum gas (LPG) vehicles have to pay an additional annual tax.
In 2016, Belgium introduced an annual fee charging owners of heavy-duty road trucks foreach kilometre driven. In Wallonia, the base rate is EUR 11.6 (VAT excluded) per km
travelled. In Flanders, the base rate is EUR 11.3/km travelled. Rates are adjusted basedon the mass and emissions of the vehicle.

Belgium does not provide any direct subsidies for the purchase of EV passenger orcommercial cars. A federal tax credit of 15% of the purchase price is provided for electricmotorcycles, tricycles and quadracycles. A corporate income tax deduction up to 120% is
granted to companies for some expenses incurred to encourage the use of electricbicycles, such as buying electric bikes for use by employees, and for building storage forelectric bicycles. The federal and regional governments are working on a plan for the
progressive abolition of the sales of new vehicles that do not meet the zero standard
emissions.

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A tax deduction is applied on company cars, based on CO2 emissions and ranging from aminimum of 50% for diesel vehicles with emissions of 190 g/km to a maximum of 100% forzero-emission vehicles (KBC Brussels, 2015). Belgium plans to progressively decrease
the tax deduction for company cars that are not electric starting in 2023, and from 2026
onwards only EVs will receive the company car tax deduction.

Federal civil servants can use public transport to commute to work for free. They also
receive a non-taxable allowance of EUR 0.24 per km for work commutes by bicycle(regular or electric). A similar non-taxable allowance up to 0.24 EUR/km can be provided
by private sector employers. In the private sector, the federal government covers 20% of
the cost of work commutes by train if the employer signs an agreement with the Belgian
national rail company. The federal government is working on a framework to allow workers
without a company car to receive a mobility budget from their employer. Other measures
aim to reduce commuting, such as a legal framework that favours teleworking andincentives to rent or buy a house close to the workplace. Flanders has an allowance forwork commutes by bicycle for civil servants (0.21 EUR/km).
All vehicles owned and operated by the Flemish government have to be hybrid, battery
electric, or compressed natural gas (CNG) and fulfil a minimum ecoscore. Since 2019,
Flanders requires all new buses for public transport to be battery electric. Flanders has set
a goal for all public transportation buses to be hybrid, battery electric or CNG by 2025, andfor all taxis to be EVs by 2030. Starting in 2025, the Flemish government will only buy orlease zero-emission passenger cars (battery or fuel cell electric vehicles).
In 2017, Wallonia adopted the FAST vision 2030, a plan for sustainable mobility to support
the 2030 target of reducing non-ETS GHG emissions by 35%. Wallonia plans to deploy
electric charging stations and CNG and liquefied natural gas (LNG) stations and topromote vehicles running on natural gas, electricity, hydrogen and hybrid vehicles.
Wallonia also plans a gradual phase-out of diesel vehicles. The low emissions decree
passed in 2018 enables Walloon municipalities to establish low-emission zones on apermanent or temporary basis, starting from 1 January 2020.
The transportation policy of the Brussels-Capital Region is defined in the Good Move plan,
approved in 2020. This plan includes objectives to reduce the use of private cars to aquarter of journeys by 2030, realise a 21% reduction in vehicle kilometres travelledby 2030 compared to 2018, improve the performance of the remaining vehicles, andencourage modal shift and vehicle sharing. The Brussels-Capital Region established alow-emission zone in 2018, with restrictions that will be progressively tightened to exclude
diesel cars (LEZ Brussels, 2021).

ENERGY SYSTEM TRANSFORMATION

4. ENERGY EFFICIENCY

Belgium’s National Recovery and Resilience Plan contains several measures that should
reduce transport energy demand through modal shifts, increased public transport andelectrification. The plan allocates a total of EUR 1 292 million to transport investments
between 2021 and 2026. EUR 672 million will be invested in public transport extensions
in all regions to reduce road transport traffic. EUR 411 million are allocated to improving
cycling and walking infrastructure, including creating or refurbishing 1 500 km of cycling
pathways. EUR 209 million are planned for investments aimed to green road transport,such as financing of 356 green buses for public transport and promoting the deploymentof over 78 000 electric charging stations.
The EUR 1.2 billion package of measure to accelerated energy transition introduced in
March 2022 includes specific efforts to increase the deployment of EVs, including a61

IEA. All rights reserved.

The government of the Brussels-Capital Region aims to phase out diesel vehicles by 2030,
and petrol and LPG by 2035 at the latest, by banning their access to the low-emission
zone. The Brussels-Capital Region aims for the deployment of 22 080 charging points
by 2035 to support a fully electrified car fleet. Future plans include the implementation ofa taxation scheme linked to a vehicle’s environmental performance.

4. ENERGY EFFICIENCY

programme supporting deployment of smart EV charging stations (and solar PV) at thetrain stations of Belgium’s national rail network. In addition, the minister of mobility was
charged to take steps to double the modal share of trains in both passenger and freighttransport.

Assessment
Belgium has 2020 indicative targets to reduce PEC to 43.7 Mtoe and FEC to 32.5 Mtoe.
In 2020, PEC was 43.9 Mtoe and FEC was 33.3 Mtoe, with most of the reduction causedby the effects of the Covid-19 pandemic. It is likely that the rebound in 2021 will push PEC
and FEC higher than the 2020 indicative targets. The federal and regional governments
should determine why energy demand reductions have been so limited and understandwhich energy efficiency policies and measures were successful and which need to berevised or replaced to support increased and sustained demand reductions.
Belgium’s NECP defines 2030 indicative targets to reduce PEC to 42.7 Mtoe and FEC to35.2 Mtoe. The 2030 FEC indicative target is higher than Belgium’s FEC in 2020 andrequires a lower demand reduction than the 2020 FEC indicative target. The European
Commission’s review of Belgium’s NECP stated that the 2030 energy efficiency indicative
targets were not ambitious and did not support the EU-wide mandatory target of a 32.5%
demand reduction by 2030 versus a business-as-usual case. Moreover, the NECP does
not give any indication of how the energy efficiency first principle will be applied.
The EU has agreed on an ambitious target of 55% reduction of GHG emissions by 2030
with respect to 1990 levels, which will be supported by a more ambitious 2030 EU-wide
energy efficiency target. IEA analysis indicates that about half the emissions reductionneeded to achieve the 55% GHG reduction 2030 target will need to come from energy
efficiency measures (IEA, 2020). As such, it is likely that Belgium will need to increase its
2030 energy efficiency indicative targets (and GHG emissions and renewables targets) to
support the EU-wide 55% emissions reduction target.

Energy efficiency targets were not part of the 2020 burden-sharing agreement, which
divided responsibility for meeting Belgium’s 2020 EU targets between the federal andregional governments. Energy efficiency is a key factor for reaching climate goals as well
as for security of supply and affordability of energy. All possible efforts should be made to
reduce energy consumption, not only in light of reaching EU targets. Lowering energy
demand is generally the most cost-effective option for reducing GHG emissions and also
facilitates the achievement of renewable energy targets. Given the numerous benefits ofenergy efficiency, the IEA recommends that Belgium’s 2030 energy efficiency targets be
included in the 2021-2030 burden-sharing agreement.
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Belgium should apply the energy efficiency first principle, and quickly determine which
expanded, revised or new policies and measures are needed to achieve more energy
savings across the whole economy to support the increased EU-wide target. Co-ordination
between federal and regional levels could support more cost-effective demand reduction
measures, for example by identifying best practices among measures applied in Belgium’s
regions and in other EU member states, and striving for common standards and measures
at a national level. More ambitious energy efficiency indicative targets and measures
should be developed in time to be included in the updated draft NECP, requested by theEuropean Commission in 2023.

The IEA recognises the efforts that have been made to support the implementation ofenergy efficiency measures in industry, including within Article 8 of the EED, requiring large
companies to carry out energy audits every four years. The IEA recommends that the next
generation of voluntary agreements with industry includes objectives that incentivise
investments in carbon-neutral technologies and processes, and leverages opportunities tocombine efficiency measures with the deployment of renewable energy and electrification.
The IEA also sees a need for Belgium to identify and remove barriers for energy service
companies to offer services for energy efficiency projects in the industrial sector.
Additionally, it would be beneficial to ensure monitoring and evaluation of all energy-saving
measures implemented in all segments for both large companies and SMEs, at theregional level.
The European Commission has highlighted that Belgium’s building stock ranks low inenergy performance and accounts for more than 30% of Belgium’s non-ETS GHG
emissions (EC, 2021). In addition, almost 80% of Belgium’s building stock was built before
energy standards were introduced. There is a strong need to accelerate renovations witha clear focus on reducing energy demand and improving thermal comfort, especially forvulnerable consumers. Renovations should also include the deployment of distributed
renewables for both electricity generation and heating. Barriers to renovation should beclearly identified and considered in policy design, and renovation programmes should
leverage economies of scale to bring down cost and accelerate demand reductions.
Support measures for building renovation could include simplifying tendering procedures
and establishing a technical assistance fund and a guarantee fund. As private finance will
be increasingly required to deliver the level of investments needed to achieve
decarbonisation of buildings, stimulation of third-party financing would be essential. The
IEA recommends that the federal and regional governments set up a risk guarantee fundfor energy efficiency to support loans from commercial banks or third financial parties. In
addition, it would be essential to develop standardised financial guidelines to apply toenergy efficiency investments, to reduce the risks of financing energy efficiency projects.

ENERGY SYSTEM TRANSFORMATION

4. ENERGY EFFICIENCY

The federal government aims for carbon neutrality in all federal buildings by 2040. To
support this goal, the IEA recommends identifying barriers that limit the use of energy
performance contracts and the ability of energy service companies to participate in therenovation of federal buildings. It would be beneficial to prepare guidelines, standardisedenergy performance contracts and protocols for monitoring, to help owners of publicbuildings to use energy performance contracts.

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In 2018, the federal government introduced a mobility budget for anyone entitled to acompany car to encourage modal shift. However, recent analysis showed that there islimited uptake of this measure and that most people still choose to have a company car.
The federal government is considering expanding eligibility for the mobility budget beyond
those entitled to a company car. The federal government should analyse why there is low
uptake of the mobility budget and use this information in future policy design to moreclearly support modal shift away from private vehicles.

4. ENERGY EFFICIENCY

Recommendations
The government of Belgium should: Co-operate with regional governments to determine why the desired decrease inenergy demand through 2020 was not achieved, and develop measures to drive
sustained improvement in energy efficiency across all sectors.
 Set more ambitious energy efficiency targets that support the EU-wide 55% emissions
reduction target; closely monitor achieved energy savings; and be ready to expand,
update or replace measures based on their results.
 Integrate measures supporting energy efficiency and renewable energy to create
economies of scale and drive cost-effective energy reductions combined withrenewables deployment.
 Consult with regional governments to identify and remove barriers for energy service
companies to participate in the market for building renovation and energy efficiency inindustry, and establish a risk guarantee fund.

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 Co-operate with the regional governments to improve strategies to reduce transportenergy demand through modal shift to public transport and walking and cycling, andthrough the electrification of vehicles.

EAFO (European Alternative Fuel Observatory) (2022), Belgium (database),https://eafo.eu/countries/belgium/1724/summary (accessed on 18 February 2022)
EC (European Commission) (2021), Analysis of the Recovery and Resilience Plan ofBelgium, https://ec.europa.eu/info/system/files/com-2021-349_swd_en.pdf
EC (2020), Belgian Integrated National Energy and Climate Plan,
https://energy.ec.europa.eu/system/files/2020-09/be_final_necp_parta_en_0.pdf
EC (2014), Belgian Energy Efficiency Action Plan,
https://ec.europa.eu/energy/sites/ener/files/documents/Belgium%20NEEAP.pdf
Eurostat (2022), Complete Energy Balances (database),https://ec.europa.eu/eurostat/databrowser/view/nrg_bal_c/default/table?lang=en (accessedon 18 February 2022)
IEA (International Energy Agency) (2022a), World Energy Balances (database),https://www.iea.org/data-and-statistics/data-product/world-energy-balances (accessed on
18 February 2022)
IEA (2022b), Energy Efficiency Indicators (database), https://www.iea.org/data-andstatistics/data-product/energy-efficiency-indicators (accessed on 18 February 2022)
IEA (2020), Achieving net-zero emissions by 2050, World Energy Outlook 2020,
https://www.iea.org/reports/world-energy-outlook-2020/achieving-net-zero-emissions-by2050#abstract
KBC Brussels (2015), Choosing a tax-efficient company car (web page),https://www.kbcbrussels.be/business/en/key-moments/administration/fiscaal-interessantebedrijfswagenkiezen.html#:~:text=If%20the%20CO2%20emissions,minimum%20deduction%20rate%20o
f%2075%25%E2%80%9C
LEZ Brussels (Low Emission Zone Brussels) (2021), Low Emissions Zone Brussels
website, https://lez.brussels/mytax/en

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References

ENERGY SYSTEM TRANSFORMATION

4. ENERGY EFFICIENCYKey data (2020)
Renewables in TFEC: 3.8 Mtoe/12.3% (IEA average in 2019: 12.9%)
Renewables in electricity generation: 23.4 TWh (wind 14.4%, bioenergy 6.0%, solar 5.8%,hydro 0.3%)
Renewable energy shares:* gross final consumption 13.0%, electricity 25.1%, heating andcooling 8.4%, transport 11.0%
EU total renewable shares:* gross final consumption 22.1%, electricity 37.5%, heating andcooling 23.1%, transport 10.2%*Computed according to Eurostat definitions for consistency with EU targets.

Overview
From 2010 to 2020, the share of renewable energy in Belgium’s total final energy
consumption (TFEC) doubled, from 6% to 12%, driven by growth in renewable electricity
generation, mainly from wind, solar PV and liquid biofuels (Figure 5.1). However, in 2019,
Belgium’s share of renewables in TFEC ranked 24th among IEA member countries.

ENERGY SYSTEM TRANSFORMATION

5. Renewable energy

Figure 5.1 Renewable energy in total final energy consumption in Belgium,
2000-2020
4

Mtoe

14%

3.5

12%

3

10%

2.5

8%

2

6%

1.5
1

4%

0.5

2%

0

0%

Hydro
Geothermal
Solar
Wind
Bioenergy (heat)
Bioenergy (electricity)
Liquid biofuels (direct use)
Solid biomass (direct use)
Share of renewables (right axis)

Renewable electricity generation from wind and solar, and direct use of liquid biofuels andbiogas, drove the increase of renewables in total final energy consumption.
Source: IEA (2022), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances.

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IEA. All rights reserved.

5. RENEWABLE ENERGY

In 2020, renewables covered 13% of Belgium’s gross final energy consumption, 25% ofelectricity generation, 8% of heating and cooling demand, and 11% of transport demand(Figure 5.2). These shares are based on Eurostat accounting, which is used to trackprogress towards Belgium’s renewable energy targets. 2
Figure 5.2 Renewable energy in key metrics in Belgium, 2020
4.0

Mtoe

30%
25%

3.0

20%

2.0
1.0
0.0

Gross final
energyconsumption

Electricity

Heating andcooling

Transport

Solar
Geothermal
Renewable electricity

15%

Wind

10%

Heat pumps

5%

Hydro

0%

Bioenergy
Renewable share (right
IEA. All rights reserved.
axis)
IEA

Renewables in electricity generation reached 21% in 2019, but the renewable energy share is
still low in heating and cooling and in transport.
Source: Eurostat (2022), Energy from Renewable Sources (database),https://ec.europa.eu/eurostat/web/energy/data/shares.

Renewable energy by sector
From 2010 to 2020, renewable electricity generation increased almost threefold, from
5.4 TWh to 23.4 TWh (Figure 5.3), driven by increased wind generation, which grew from
1.4% to 14.4% of total electricity generation, and increased solar PV generation, whichgrew from 0.6% to 5.8% of generation. From 2010 to 2018, electricity generation frombioenergy (mainly solid biomass, but also biogas, renewable waste and liquid biofuels)
experienced an overall increase, from 4.4% to 7.3%, but declined to 6.0% of generationin 2019. Belgium has limited hydropower resources and hydropower plays a small role,covering just 0.3% of generation in 2020, with almost no growth since 2000.

2 Eurostat applies formulas to normalise fluctuations of electricity generation from wind and hydro, and multiplication

factors that give higher shares to transportation use of advanced biofuels and renewable electricity. The share of
renewables in gross final energy consumption includes domestic renewables and statistical transfers of renewablesfrom other EU member states allowed under EU rules.

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From 2010 to 2016, the share of renewables in heating and cooling grew from 6.7% to
8.2%. Since, it has been relatively stable, at 8.4% in 2020 (Figure 5.4). Most renewable
heating and cooling in Belgium comes from solid biomass used for heating in industry andresidential buildings. Solid biomass accounted for 80% of renewables in heating andcooling in 2020, followed by biogas (8.0%), heat pumps (8.9%), solar thermal (1.8%) andrenewable waste (1.1%). Since 2016, the heating from solid biomass has consistently
declined, while the use of heat pumps has been steadily rising.

Figure 5.3 Renewable energy in electricity generation in Belgium, 2000-2020
25

TWh

25%

Hydro
Solar

20

20%

15

15%

Liquid biofuels

10

10%

Renewable waste

5

5%

0

0%

Wind

BiogasSolid biomass
Renewable share(right axis)

IEA. All rights reserved.

Renewable electricity generation increased almost threefold between 2010 and 2020, driven
by an increase wind and solar PV deployment.
Source: IEA (2022), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances .

Figure 5.4 Renewable energy in heating and cooling in Belgium, 2004-2020
1.8
1.6
1.4
1.2
1
0.8
0.6
0.4
0.2
0

Mtoe

9%
8%
7%
6%
5%
4%
3%
2%
1%
0%

Renewable
waste
BiogasSolar thermal
Heat pumps
Liquid biofuels
Solid biomass

ENERGY SYSTEM TRANSFORMATION

5. RENEWABLE ENERGY

Renewable share(right axis)
IEA. All rights reserved.

Since 2016, the share of renewables in heating and cooling has been stable at just over 8%.
Most renewables heating and cooling comes from solid biomass, with an increasing role ofheat pumps.
Sources: Eurostat (2022), Energy from Renewable Sources (database),https://ec.europa.eu/eurostat/web/energy/data/shares.

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Renewables in transport consist mainly of biofuels blended with diesel and gasoline, alongwith renewable electricity in rail (Figure 5.5). Biodiesel accounted for 77% of renewables
in transport in 2020, almost doubling since 2010, with a significant rise in 2020. Biogasoline
accounted for 17% of renewables in transport in 2020 and has more than doubled
since 2010, notably increasing since 2016. Renewable electricity used in rail accounted
for 5% of renewables in transport in 2020 and has increased by 48% since 2009. Electricity
in road transport accounted for 0.5% of renewables in transport in 2020, but is expected
to grow with increasing EV uptake (see Chapter 4).

5. RENEWABLE ENERGY

Figure 5.5 Renewable energy in transport in Belgium, 2004-2020
0.8

Mtoe

12%

0.7

Renewable
electricity

10%

0.6

8%

0.5
0.4

Biodiesel

6%

0.3

4%

0.2

Biogasoline

2%

0.1

Renewable share(right axis)

0%0

IEA. All rights reserved.

Renewables in transport consists mainly of biofuels blended with diesel and gasoline.
Sources: Eurostat (2022), Energy from Renewable Sources (database),https://ec.europa.eu/eurostat/web/energy/data/shares.

Renewable energy targets
Under the EU Renewable Energy Directive (RED), Belgium has 2020 and 2030 targets forrenewables in gross final consumption, electricity generation, heating and cooling, andtransport (Figure 5.6). Belgium’s renewable energy targets are intended to support thetargets for the entire EU to reach a 20% share of renewable energy in gross final energy
consumption by 2020 and 32% by 2030. To support the increased 55% GHG emissions
reduction target, the EU is developing a higher renewable energy target for 2030.

Share of renewables

Figure 5.6 Belgium’s 2020 and 2030 renewable energy targets and status, 2004-2020
40%

Electricity

35%

Targets electricity

30%

Transport

25%

Targets transport

20%

Gross final consumption

15%
5%Targets gross final
consumption
Heating and cooling0%2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030

Targets heating andcooling IEA. All rights reserved.

10%

Renewable energy share
Gross final energy consumption
Electricity*
Heating and cooling*
Transport

2019 status
9.9%
20.8%
8.3%
6.8%

2020 status
13%
25.1%
8.4%
11%

2020 targets
13%
20.9%
11.9%
10.14%

2030 targets
17.5%
37.4%
11.3%
23.7%

Sources: Eurostat (2022), Energy from Renewable Sources (database), https://ec.europa.eu/eurostat/web/energy/data/shares; EC(2021a),BelgianIntegrated
National
Energyand
ClimatePlan,
https://energy.ec.europa.eu/system/files/202009/be_final_necp_parta_en_0.pdf.

Belgium achieved the 2020 indicative target for renewables in electricity. Thanks to anincrease in biofuel blending in 2020, Belgium’s share of renewables in transport reached
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* Indicative targets.

11%, exceeding the 2020 binding target of 10%. However, the share of renewable heating
and cooling did not reach the desired indicative share. Belgium’s 2018 burden-sharing
agreement divides responsibility for meeting the 2020 target of 13% renewables in grossfinal energy consumption between the federal and regional governments. Under thisagreement, the estimated level of renewable energy needed to meet the 2020 target(49 125 gigawatt hours [GWh]) was divided between Flanders (25 074 GWh), Wallonia(14 851 GWh), the federal government (8 350 GWh) and the Brussels-Capital Region(849 GWh).
Under EU rules, any EU member state not meeting its target for renewables must purchasestatistical transfers from EU member states that exceeded their 2020 target. Belgium’s
burden-sharing agreement requires governments failing to meet their contribution to thenational 2020 target to purchase statistical transfers needed to cover their deficit.
Projections from 2020 indicated that Wallonia had a surplus of 1 465 GWh over its
contribution. However, this was insufficient to compensate for deficits from Flanders, thefederal government and the Brussels-Capital Region. In October 2020, Flanderspurchased 2 070 GWh of statistical transfers from Denmark for EUR 22.5 million(The Brussels Times, 2020). In September 2021, the federal government purchased 1 655
GWh of statistical transfers from Finland for EUR 18.6 million (Finnish Government, 2021).
In 2021, the Brussels-Capital Region purchased 152 GWh of statistical transfers from
Lithuania (EC, 2021b).
The federal and regional governments are developing a burden-sharing agreement todivide responsibility for meeting the 2030 targets.

Renewable energy policy and support measures
Belgium’s NECP is the main policy document defining renewable energy policy through2030. In line with EU requirements, the NECP sets Belgium’s 2030 renewable energy
targets and specifies the policies and measures intended to help achieve these targets.
The policies and measures in the NECP reflect the division of competencies between thefederal and regional governments. Competency over renewable energy policy rests mainlywith the regional governments. The federal government is responsible for Belgium’s
territorial waters, giving it authority over policy for offshore energy development. The
federal government also has responsibility over policy for transportation fuels, including
biofuels. The NECP defines the specific measures to be taken by each government tosupport the achievement of Belgium’s 2030 renewable energy targets.

ENERGY SYSTEM TRANSFORMATION

5. RENEWABLE ENERGY

Renewables in electricity

Certificates are issued by the relevant energy regulator based on MWh of renewableelectricity generated (federal government and Flanders) or on avoided CO2 emissions(Wallonia and the Brussels-Capital Region). The green certificate programmes of71

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Electricity generation from renewable energy is promoted primarily through programmesthat require electricity suppliers to obtain a quota of green certificates. There are four
separate green certificate programmes (one for the federal government covering only
offshore wind generation and one for each of the three regional governments, covering a
range of renewable technologies). The programmes of Wallonia and the Brussels-Capital
Region include increasing annual quotas.

5. RENEWABLE ENERGY

Flanders, Wallonia and the Brussels-Capital Region allow electricity producers andsuppliers to trade certificates. The regional programmes also impose fines on suppliers
that do not meet their certificate quota. Certificates cannot be traded between the regional
programmes and the federal programme does not allow any trading of certificates.
Renewable energy projects can generate green certificates for a certain number of years
following project commissioning: 10 years for the Brussels-Capital Region, 10-15 years for
Flanders and Wallonia, and 20 years under the federal programme for offshore wind
(19 years since 2019). The prices paid for certificates vary between programmes and havebeen adjusted numerous times to reduce the level of subsidies, in line with falling
technology and deployment costs and so that certificate prices vary in line with electricity
market prices.
Under the federal green certificate programme, the TSO is allowed to offset the cost ofpurchasing green certificates with an offshore surcharge to all end consumers. The
maximum surcharge for private companies is EUR 250 000 per grid connection.
Companies participating in a voluntary energy efficiency agreement can receive a 15-45%
reduction on the offshore surcharge, depending on their annual electricity demand.
Voluntary energy efficiency agreements require companies to take certain action to reduceenergy demand (see Chapter 4). The discount on the offshore surcharge is funded throughspecific excise duties and general corporate tax.
The federal government is in the process of updating the discount system, includingchanges to how the discount is calculated, adopting European guidelines for state aid withregard to companies with significant electricity demand, eliminating the offshore surcharge
for electricity storage installations and setting a different discount for railway network
operators.
In tandem with the green certificate programme for offshore wind, the federal government
established a dedicated zone for offshore wind deployment covering 225 square
kilometres (km²) in the Belgian North Sea adjacent to the marine border with the
Netherlands. This zone was selected based on a review of wind resource quality andaccounting for other issues, including environmental factors and competing uses(commercial fishing, shipping, and military and civilian aviation). As of 2020, nine offshore
wind farms with a total capacity of 2.26 GW had been built in the offshore wind zone, which
is close to the maximum planned deployment.

In 2019, the TSO finished the deployment of the first phase of Belgium’s Modular Offshore
Grid, which supports the connection of offshore wind projects to the national grid at a
reduced cost and allows for connection with the offshore grids of other countries operating
offshore wind farms in the North Sea. The Modular Offshore Grid connects the four
offshore wind projects commissioned from 2019 to 2020 and it is planned that it will be
expanded to connect projects developed in the second offshore wind zone (Elia, 2022).
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The Marine Spatial Plan 2020-2026 requires the development of a second offshore windzone of 281 km² in the Belgian North Sea adjacent to the marine border with France. In
October 2021, the planned capacity for the second offshore zone was expanded from
2.2 GW to 3.15-3.5 GW. This increased the goal for total offshore wind capacity from 4 GW
to 5.35-5.7 GW by 2030. Together, the two zones will cover much of the area available foroffshore wind deployment in Belgium’s territorial waters. To drive cost-competitive
deployment in the second offshore wind zone, the federal government is developing acompetitive bidding procedure.

Belgium’s National Recovery and Resilience Plan (issued in response to the Covid-19
pandemic) includes EUR 100 million for the development of an offshore energy hub tosupport the expansion of offshore wind generation.
In addition to green certificate programmes, the regional governments have a variety of
programmes and support measures that push for the deployment of electricity generationfrom renewable energy, especially for small-scale distributed solar PV generation. These
programmes provide financial support and work to address challenges like spatialplanning.
The EUR 1.2 billion package of measures to accelerate energy transition introduced in
March 2022 includes several efforts to increase the deployment of renewable electricity
generation. This includes plans to accelerate the development of the second offshore windzone, repower the first offshore wind zone to increase its capacity, examine options forcreating a third offshore wind zone and a push for deployment of a meshed offshore
electricity grid linking the countries around the North Sea.
The package also pushes for accelerated deployment of solar PV, including funding todeploy solar PV on national railway stations (in connection with EV smart charging) andon federal buildings. There are also measures to support the deployment of large-scale
floating solar PV systems. In addition, the VAT on solar PV panels was reduced to 6% for2022 and 2023. The package also aims to reduce the time needed to obtain permits andlicences for onshore solar PV and wind generation projects.

Renewables in transportation
Belgium’s main policy for encouraging renewable energy in transport is a biofuels blending
mandate that requires all companies selling road transportation fuels to reach a certain
share of biofuels (by energy content) in their annual sales. The biofuel blending obligation
was 9.55% for 2020 and 2021. The NECP proposes annually increasing the required shareto reach 13.9% by 2030. Under the RED, the contribution of first-generation biofuels(derived from food or animal feed) to meeting the blending mandate is limited to 7%. The
remainder must be covered by advanced biofuels that meet sustainability criteria or by
renewable electricity used in road and rail transport. EU accounting rules give a bonus
above the actual energy content for qualifying advanced biofuels and renewable electricity.
Belgium is aiming to increase the share of renewable energy in transport through the
deployment of EVs in tandem with increased electricity generation from renewables (seeChapter 4). The March 2022 package to accelerate energy transition includes plans to
deploy EV smart charging and solar PV at the stations of the national railway operator.

ENERGY SYSTEM TRANSFORMATION

5. RENEWABLE ENERGY

The regional governments are responsible for most policies related to renewables inheating and cooling and have established a variety of support programmes (tenders, direct
payments, building codes, etc.) to encourage the development of both distributed solutions(heat pumps and bioenergy) and renewable district heating. Wallonia has introduced asupport scheme providing payments to projects that inject biomethane into the natural gas
grid. The March 2022 package to accelerate energy transition aims to increase renewable
heating and cooling. For example, the VAT on solar PV thermal collectors and on heatpumps was reduced to 6% for 2022 and 2023.

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Renewables in heating and cooling5. RENEWABLE ENERGY

Assessment
From 2009 to 2019, the share of renewable energy in Belgium’s TFEC increased from 5%
to 10%, driven by growth in renewable electricity generation (mainly wind and solar PV)
and increased bioenergy use for transport and industrial and building heating. However,in 2019, Belgium’s share of renewables in TFEC was relatively low, ranking 24th among
IEA member countries.
Under the RED, Belgium has 2020 and 2030 targets for renewables that are intended tosupport the achievement of EU-wide renewable energy targets. Belgium achieved therequired 13% share of renewables in gross final energy consumption, however thisrequired purchasing statistical transfers for other EU member countries (without thesetransfers, the 2020 share was 12%). The federal and regional governments should
co-operate to determine why domestic use of renewable energy was not sufficient to meetthe 2020 renewable target, what the main barriers were, which measures were successful
in driving the deployment of renewables, and which measures need to be revised or
replaced to support increased and sustained uptake of renewables.
Belgium’s NECP is the main policy document defining renewable energy policy through2030. It sets Belgium’s 2030 renewable energy targets and specifies the policies andmeasures intended to support the achievement of these targets. In October 2020, theEuropean Commission provided comments on Belgium’s NECP, noting that the2030 targets for renewable energy are not sufficiently ambitious for the achievement of the
EU-wide 2030 target of a 32% renewable energy share of the EU’s gross final energy
consumption (EC, 2021c). The EU calculation shows that Belgium needs to reach a 25%
share of renewable energy in gross final energy consumption in 2030 (the current target
is 17.5%). In addition, in July 2021, the 2030 EU-wide GHG emissions reduction target
was increased from 40% to 55%. The EU has indicated that it will update the RED toincrease the EU-wide renewable energy target from 32% to 40% to support the EU-wide
55% GHG reduction target.
Given the European Commission’s assessment of the NECP and the likelihood of higher
EU renewable energy targets, Belgium should increase its national renewable energy
targets to ensure they support the EU-wide 55% emissions reduction target. Belgium
should also quickly develop an understanding of the options for additional renewableenergy capacity and the measures needed to accelerate the deployment of renewables.
More ambitious targets and additional measures should be included in an updated NECP
requested by the European Commission in draft form by 2023. Both these steps would
help to provide clear signals to investors.

cost-effectiveness of green certificates through a national market. However, thegovernment has indicated that no steps have been taken to align the certificate systems
or to allow for national trading.

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Belgium’s renewable energy policies and measures reflect the division of competencies
between the federal and regional governments. Responsibility for renewable energy
policy rests mainly with the regional governments. This division of competencies hinders
the development of a shared long-term vision and implementation of coherent policies.
For example, the previous IEA energy policy review of Belgium recommended
harmonising the country’s four green certificate programmes to increase the impact andThe federal and regional governments are developing a burden-sharing agreement todivide responsibility for meeting the 2030 targets. The IEA recommends that federal andregional governments co-operate to quickly conclude a new burden-sharing agreementthat harmonises policies across the country and accounts for the higher EU targets toprovide policy clarity to stakeholders and investors. A burden-sharing agreement thattakes into account the distribution of renewable resources among regions would result ina more climate-friendly, affordable and secure energy system.
Electricity generation from renewable energy is promoted primarily through green
certificate programmes (the federal programme covers offshore wind while the three
regional programmes cover a range of renewable technologies). Details vary between the
programmes, but in general certificate prices have been adjusted with the goal to reduce
subsidies in line with falling technology and deployment costs and to better reflect market
prices.
Belgium’s National Recovery and Resilience Plan (issued in response to the Covid-19
pandemic) includes EUR 100 million for the development of an offshore energy hub tosupport the expansion of offshore wind generation. However, the European Commission’s
analysis from June 2021 noted that aside from the offshore energy hub, Belgium’s National
Recovery and Resilience Plan contains limited investments for the deployment of
renewable energy and that additional funding outside of the plan will be necessary toachieve Belgium’s 2030 renewable energy targets. Belgium should increase its efforts toalign its plans for recovery from the Covid-19 pandemic with energy transition.
Belgium had rapid growth in offshore wind. In 2020, the development of its first offshore
wind zone was completed with 2.26 GW of capacity. The NECP sets a target for at least
4 GW of offshore wind capacity by 2030. In 2019, the Marine Spatial Plan 2020-2026 wasapproved, requiring the development of a second offshore wind zone, and the federal
government started working on the development of a competitive bidding process foroffshore wind. The government should consider including an option for projects withbattery storage in the competitive bidding process, as this would greatly increase the abilityof new offshore wind projects to support system flexibility.

ENERGY SYSTEM TRANSFORMATION

5. RENEWABLE ENERGY

In 2021, Belgium had the sxith-highest offshore wind capacity in the world and is pushingfor additional development. However, Belgium has limited territorial waters and offshore
wind must compete with numerous other uses and respect environmental constraints.

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The TSO is responsible for the development and cost of the network to connect Belgium’s
offshore wind generation. The TSO finished the first phase of Belgium’s Modular Offshore
Grid, which connected the last project in the first offshore wind zone and will be expanded
and upgraded to connect the second offshore wind zone. It is critical that the necessary
onshore transmission investments are completed in time to support the offshore projects.
No major issues have been identified with the Modular Offshore Grid; however, the TSO
is having difficulties obtaining the necessary construction permits for the needed onshoretransmission infrastructure, with the underlying risk of not being able to connect the newoffshore wind farms in time. Wind farm developers have indicated they could commission
their projects by 2025, but current permitting delays do not support this and could pushcommissioning past 2026. Given the critical need for additional generation capacity in linewith the nuclear phase-out, strong efforts should be made to accelerate the deployment of
infrastructure supporting offshore wind.

5. RENEWABLE ENERGY

Development beyond the second offshore wind zone will be difficult and Belgium is
exploring the option of interconnection with or developing new offshore wind capacity inthe waters of other countries.
In February 2021, Belgium and Denmark signed a memorandum of understanding for thedevelopment of an electricity interconnector from an energy island Denmark plans to buildin the North Sea. The interconnector could connect Belgium to large offshore wind farms
off the Danish coast. Power from the wind farms would be transmitted to both countries.
Denmark is already co-operating with Germany and the Netherlands, looking into similarinternational connections from the energy island. If the electricity interconnection between
Denmark and Belgium becomes a reality, it will pass through the offshore waters of four
different countries, and will probably be the one of the world’s longest DC high-voltage
cables.
Belgium’s goals to greatly increase generation from wind and solar PV require strong
interconnections and domestic networks. Investments in the grid should be given priority
to facilitate the necessary trade and prevent network congestion. The TSO is making
regular investments to ensure adequate interconnection capacity. The Nemo Link
high-voltage direct current (HVDC) subsea cable linked Belgium to the United Kingdom
in 2019, and in 2020 an HVDC underground cable linked Belgium to Germany. Belgium isalso examining the possibility of a second subsea interconnector with the United Kingdom(Nautilus) that connects the grids of both countries and directly connects offshore windfarms to the mainland. The European Commission selected Nautilus as a project ofcommon interest.
There are permitting and public acceptance issues that the federal and regional
governments need to address to ensure that renewables deployment (onshore wind andlarge-scale PV) and grid development can move forward as envisaged in the NECP. Given
the likely need to increase renewable energy targets, efforts should be made to clearlyalign renewables deployment with the development of supporting infrastructure, taking into
account environmental impacts and public acceptance.
The NECP also recognises the importance of energy storage for increasing the integrationof renewable energy and improving overall system flexibility. Belgium currently has around1.31 GW of pumped storage capacity, which plays an important role in system balancing.
However, there is limited opportunity for further development of pumped hydro storageand Belgium has only limited deployment of battery storage. The governments should
ensure that legal, regulatory or other barriers to storage deployment are removed and thatstorage is able to fully and effectively participate in all electricity markets.

Belgium’s dense population is ideal for the development of district heating. However, very
little heating demand in Belgium is covered by direct supply of heat. In 2019, district
heating covered just 1% of energy demand from service sector buildings and just 0.2% ofenergy demand from residential buildings. Belgium should take actions to promote district
heating. District heating can easily be decarbonised with renewables like biomass
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The regional governments are responsible for most policies related to renewable heating
and cooling and have established a variety of support programmes (tenders, direct
payments, building codes) to encourage the development of both distributed solutions(heat pumps and bioenergy) and renewable district heating. Wallonia has introduced asupport scheme providing payment to projects that inject biomethane into the natural gas
grid.

co-generation, solar thermal or geothermal, large heat pumps, and excess heat. Moreover,waste heat from Belgium’s large industrial complexes can be used for residential heating.
Belgium should place a strong focus on the renewable heating option in less dense areas(especially to eliminate the use of oil-based heating). Heat pumps and solar heat can beused for heating in rural areas, and combined with renewable generation from solar PVs
with batteries. Belgium should also take steps to increase the sustainable production of
biogas and biomethane, which can support renewable heating through direct use and grid
injection.
Renewable energy in transport is mainly supported through a federal biofuels blending
mandate, which requires all companies selling road transportation fuels to blend a certain
share of biofuels by energy content. The blending obligation was 9.55% for 2020 and 2021.
The NECP proposes annual increases in biofuel blending from 2020 to reach 13.9%
by 2030. Under the RED, a certain share of transport biofuels must be advanced biofuelsthat meet sustainability criteria. Belgium should consider expanding the biofuel blending
obligation to cover inland shipping.
In Belgium, transportation biofuels are taxed at the same rate as fossil fuels. The
government should examine biofuels taxation in the upcoming fiscal policy review andconsider decreasing or eliminating taxes on advanced biofuels, to limit price impacts andfurther promote biofuels deployment in the transport sector.
Belgium is also aiming to increase the share of renewable energy in transport through the
deployment of EVs, in tandem with increased electricity generation from renewables. A
strong deployment of EVs requires a clear strategy on charging infrastructure deployment
and co-ordination with system operation to ensure that grids are expanded as needed tosupport charging. Smart charging and other strategies such as dynamic pricing should be
developed across all of Belgium to ensure that EVs can be rapidly deployed with secure
grid operations.

ENERGY SYSTEM TRANSFORMATION

5. RENEWABLE ENERGY

Recommendations
The government of Belgium should: Co-operate with the regional governments to evaluate the support measures forrenewable energy, expand effective support measures, and update or replace
ineffective measures to accelerate renewable deployment.

 Ensure that infrastructure planning, approval and permitting processes allow for thetimely expansion of transmission and distribution systems needed to support a rapid
and sustained renewables deployment, especially for the second offshore wind zone.

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 Increase renewable energy targets in line with the EU’s 55% emissions reduction
target and expected revision of the Renewable Energy Directive, and together with theregional governments agree on a transparent road map with clear milestones toachieve these targets.

5. RENEWABLE ENERGY

References
Finnish Government (2021), Finland and Belgium have signed the agreement on statisticaltransfers of renewable energy, https://valtioneuvosto.fi/en/-/1410877/finland-and-belgiumhave-signed-the-agreement-on-statistical-transfers-of-renewableenergy#:~:text=By%20means%20of%20the%20agreement,18%2C582%2C750%20on%20
30%20September%202021.
EC (European Commission) (2021a), Belgian Integrated National Energy and Climate Plan,
https://energy.ec.europa.eu/system/files/2020-09/be_final_necp_parta_en_0.pdf.
EC (2021b), Agreement between the Republic of Lithuania and the Brussels-Capital Region
on the Statistical Transfers of Energy from Renewable Energy Sources for Target
Compliances Purposes,
https://lrv.lt/uploads/main/meetings/docs/2134893_imp_add4c18040395414f6c2f9ce78da6
17f.pdf.
EC (2021c), Assessment of the Final National Energy and Climate Plan of Belgium,https://ec.europa.eu/energy/sites/default/files/documents/staff_working_document_assess
ment_necp_belgium_en.pdf.
Elia (2022), MOG-II, https://www.elia.be/en/infrastructure-and-projects/infrastructureprojects/mog-ii.
Eurostat (2022), Energy from Renewable Sources (database),https://ec.europa.eu/eurostat/web/energy/data/shares (accessed on 18 February 2022).
Government of Belgium (2021), The competences of the federal authorities (web page),https://www.belgium.be/fr/la_belgique/pouvoirs_publics/autorites_federales/competences_autorites_federales.
IEA (International Energy Agency) (2022), World Energy Balances (database),https://www.iea.org/data-and-statistics/data-product/world-energy-balances (accessed on
18 February 2022).

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The Brussels Times (2020), Belgium will not reach its renewable energy goal for 2020,
https://www.brusselstimes.com/news/belgium-all-news/141197/belgium-will-not-reach-itsrenewable-energy-goal-for-2020-energy-minister-tinne-van-der-straeten-house-committeeflanders-brussels-wallonia-marie-christine-marghem-wind-farms-n-va-bert-wollants.

Key data
Public energy R&D spending (2020): EUR 285.4 million
Public energy R&D share of GDP (2019): 0.050% (IEA median:* 0.035%)* Median of 27 IEA member countries for which 2019 data are available.

Overview
Between 2012 and 2017, Belgium’s public spending on energy research and development(R&D) fell from EUR 210 million to EUR 160 million. Since then, public spending on energy
R&D has increased rapidly to reach EUR 285 million in 2020 (Figure 6.1). In 2020, thelargest shares of public spending on energy R&D went to nuclear energy (41%, primarily
for nuclear fission) and energy efficiency (41%, mainly for efficiency in transport andindustry), followed by renewables (6.9%), other power and storage technologies (6.5%),hydrogen and fuel cells (1.7%), other cross-cutting technologies and research (1.8%), andfossil fuels (1.2%).

ENERGY SYSTEM TRANSFORMATION

6. Energy research, development andinnovation

Figure 6.1 Public spending on energy R&D by sector in Belgium, 2011-2020
300

Fossil fuels

EUR million (nominal)

Hydrogen and fuel
cells
Other

250
200

100

Other power andstorage technologies
Renewables

50

Energy efficiency

150

0

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Nuclear
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Source: IEA (2022), Energy Technology RD&D Budgets (database), https://www.iea.org/data-and-statistics/dataproduct/energy-technology-rd-and-d-budget-database-2.

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Public spending on energy R&D increased significantly between 2017 and 2020,
especially for nuclear energy and energy efficiency.

6. ENERGY RESEARCH, DEVELOPMENT AND INNOVATION

In 2019, Belgium’s public spending on energy R&D equalled 0.05% of its GDP, theeighth-highest spending among IEA member countries and above the IEA average of
0.037% of GDP. According to Belgium’s R&D survey, private sector research expendituresin energy-producing sectors averaged EUR 117 million per year between 2012 and 2017.
Responsibility for energy R&D policy is divided between the federal and regional
governments based on their energy policy competencies. The federal government is
responsible for R&D covering nuclear energy, offshore energy, transportation fuels,
security of energy supply and network balancing. The regional governments are
responsible for R&D related to energy efficiency, renewables and for public-private
co-operation on R&D. The governments of the Flemish, French and German-speaking
Communities organise the R&D conducted by Belgium’s universities.

R&D targets
Under the Europe 2020 strategy, Belgium committed to supporting the target for combined
public and private spending on R&D to reach 3% of the EU’s GDP by 2020. This EU target
was not achieved, with the share reaching just above 2% of the EU’s GDP in 2020. Most
EU member countries (including Belgium) fell short of spending levels needed to support
the 2020 target. In September 2020, the European Commission issued a communication
reaffirming the target for 3% of GDP to be invested in R&D, but with the deadline extended
to 2030. The EU also set a 2030 target for 5% of each EU member country’s public R&D
funding to support R&D undertaken through co-operative European partnerships(EC, 2020).
Belgium is committed to achieving the 2030 EU R&D targets. Belgium’s NECP commits toincreasing total R&D spending to at least 3% of GDP (1% public, 2% private) by 2030 andplaces a strong focus on European co-operation. The government of Flanders has
committed to reaching the target of 3% of GDP for R&D by 2024. To reach this target,
Flanders will support R&D with a one-off allotment of EUR 194 million and a
EUR 250 million increase in its annual R&D budget. This is on top of a EUR 500 million
increase in the annual R&D budget from 2014 to 2018. Wallonia has also committed toreach the 3% of GDP invested in R&D by 2030, and wants to see the EU target increased
to 4% by 2035 and 5% by 2050. The Brussels-Capital Region also supports the 3%
by 2030 target.
Belgium’s Inter-federal Energy Pact recommends that as of 2020, 5-10% of Belgium’s
public R&D spending supports projects related to decarbonising the economy. The federal
government has indicated that as of 2020, 5-10% of its R&D budget will be earmarked forclimate and energy projects. Belgium’s NECP notes that Wallonia has set a target for
public spending on energy and climate R&D to reach EUR 110 million per year by 2030.

Energy R&D policy and support measures in Belgium are divided between the federal andregional governments based on their energy competencies. Given the significant role ofenergy-intensive industries in Belgium’s economy, R&D policy places a strong focus on
maintaining industrial competitiveness while helping industry to support energy transition.

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Energy R&D policy and support measures

Federal government
At the federal level, a key R&D priority is maintaining nuclear expertise, particularly in
relation to the responsible management of radioactive waste and spent nuclear fuel tosupport the safe operation and decommissioning of nuclear power plants. The NECP
reaffirms federal support for fusion R&D and for fission R&D in relation to the responsible
management of radioactive waste and spent nuclear fuel.
Belgium seeks to maintain expertise in nuclear RD&D and is making a major investmentin this area through the MYRRHA research facility that will support a range of nuclear R&D,
including work related to the long-term management of high-level radioactive waste. The
total budget for MYRRHA is estimated at EUR 1.6 billion, of which EUR 558 million arecommitted by the federal government. The federal government also places a priority on
R&D related to security of electricity supply, especially in relation to the phase-out of mostof Belgium’s nuclear generation. In 2022, Belgium commited EUR 100 million over four
years for research supporting the development of small modular nuclear reactors.
One of the main mechanisms supporting federal energy R&D is the Energy Transition
Fund. Established in 2016, the fund is financed through a fee of EUR 20 million per year
through 2025, paid by the operator of the Doel 1 and 2 nuclear reactors. The fund finances
innovative energy projects falling under the responsibility of the federal government,
including projects related to nuclear energy guaranteeing security of energy supply(particularly energy production and storage and demand-side management), offshore windand biofuels. The Energy Transition Fund also provides funding for R&D infrastructuresand innovation by SMEs.
The Energy Transition Fund provides support as grants issued through competitive calls
for proposals organised by the Directorate-General for Energy. The topics of each call are
determined based on input from the Minister of Energy. The fund supports a wide rangeof R&D, including fundamental research, industrial research, feasibility studies,
experimental development and other areas across a range of technology readiness levels.
The first three calls (issued in June 2017, December 2017 and August 2018), resulted in
EUR 57 million of grants to 35 projects. Calls issued in October 2019, November 2020 andNovember 2021 offered a total budget of EUR 75 million. The government has announced
that a seventh call for proposals will be issued in November 2022.

ENERGY SYSTEM TRANSFORMATION

6. ENERGY RESEARCH, DEVELOPMENT AND INNOVATION

Belgium’s tax code allows for a deduction of income related to a wide range of investments,
with increased deductions for investments related to patents and green R&D. Belgium also
provides a refundable tax credit targeting green R&D investments. There is also a tax
exemption related to employing researchers with a masters or doctoral degree. A
deduction for income related to intellectual property was abolished August 2016; however,this deduction could be applied through June 2021 for income related to intellectual
property that was registered before July 2016. In place of the intellectual property
deduction, Belgium established a tax deduction for innovation-related income in July 2016.

In Flanders, energy R&D policy is part of science, technology and innovation (STI) policy.
The main STI policy document sets six top-level priorities, including a priority for innovation
supporting climate-neutral solutions for industry. In 2016, the Flemish government
approved a decree establishing support for spearhead innovation clusters. The objectiveof the clusters is to increase the competitiveness of Flemish companies through81

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Flanders

6. ENERGY RESEARCH, DEVELOPMENT AND INNOVATION

partnerships between companies and co-operation with public R&D entities. Five of theclusters focus on energy-related technologies and in 2019, a new cluster was establishedto focus on hydrogen. The Flemish government has also set a goal to become afrontrunner in hydrogen technologies and published a Regional Hydrogen Strategy inNovember 2020. The strategy sets general goals for research and innovation aiming toaccelerate the production and use of low-carbon hydrogen, with a focus on international
co-operation and securing EU funding for projects of common interest.
Flux50, one of the spearhead clusters, aims to support Flanders in gaining internationalrecognition as a Smart Energy Region. Flux50 facilitates cross-sector collaboration
between energy, information technology and building companies to enhance thecompetitiveness of the Flemish smart energy industry in the transition towards low-carbon
systems. Flux50 brings together relevant players from industry, academia and government
and provides them with project support, networking opportunities and a knowledge-sharing
platform. To bring innovative and fully integrated energy products and services to market,
Flux50 sets up and co-ordinates living labs in five innovator zones: 1) energy harbours;2) micro-grids; 3) district-level multi-energy solutions; 4) energy cloud platforms; and5) intelligent renovation (Flux50, 2021).
The Flanders Industry Innovation Moonshot Programme was established in 2019 with abudget of EUR 20 million per year through 2040. It supports co-operation between Flemish
universities, research institutes and industrial companies on R&D to develop technologies
for new climate-friendly processes and products by 2040, to achieve the 2050 objective ofa carbon circular industry in Flanders. The Moonshot Programme identifies four themes
based on R&D expertise in Flanders: 1) bio-based chemistry; 2) circularity of carbon inmaterials; 3) electrification and process transformation; and 4) energy innovation.
Energy R&D in Flanders is also supported through EnergyVille, a collaboration between
several research entities working on sustainable energy and intelligent energy systems.
EnergyVille develops the technologies and knowledge to support public and private
stakeholders in their transition to an energy-efficient, decarbonised and sustainable urban
environment (EnergyVille, 2021).

Wallonia
Wallonia’s Regional Policy Statement 2019 defines its overall investment policy, including
for R&D. Under the Regional Policy Statement, Wallonia intends to support energy R&D
focused on climate change, including new low-carbon energy carriers, power-to-gas, direct
air capture, PV windows and micro-grids.

Wallonia is also working with industry to reinforce private R&D efforts in areas most
relevant to energy transition. Wallonia will establish target-based contracts withcompetitive clusters in line with the innovation goals of the Smart Specialization Strategy.
The competitive clusters are groups of companies and public or private R&D entities

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Wallonia’s Smart Specialisation Strategy defines a strategic framework for R&D andindustrial policy. It defines five strategic innovation areas as priorities for R&D based on
an analysis of local strengths. The five strategic innovation areas are: 1) circular materials;
2) innovations for health; 3) innovations for manufacturing; 4) energetic systems andsustainable housing; and 5) food processing and innovative management of theenvironment.

In 2021, Wallonia introduced an Intelligent Specialisation Strategy that identifies five
strategic innovation domains. One of these domains, sustainable energy systems andhousing, defines ambitions and strategic areas for energy research. It will drive European
Structural Funds calls and regional calls of projects (Economie Wallonie, 2021).

Brussels-Capital Region
The R&D policy of the Brussels-Capital Region, set in its Regional Innovation Plan, aims
to drive R&D that supports a 2050 carbon neutrality. The Regional Innovation Strategy(2021-2027) identifies six strategic innovation domains: 1) digital technology;2) climate-resilient infrastructure; 3) optimal use of resources; 4) urban flows; 5) health;and 6) social innovation. In the context of this plan, R&D will aim to support varioustransition paths towards a low-carbon, circular and inclusive economy
The Brussels Regional Program for a Circular Economy (PREC 2016-2020) was adopted
in 2016. One of its objectives is to stimulate technological and organisation innovations
linked to the urban circular economy. The PREC stresses the need for funding innovation
projects and living labs. It supported the creation of the Greenbizz incubator. The PREC
is followed by the current Regional Strategy of Economic Transition, which aims to achieve
the transition towards a circular and decarbonised economy, namely through targetedindustrial R&D and employment policies.

International collaboration
Belgium co-operates on R&D with the EU and other EU member states through thenumerous R&D initiatives and programmes organised by the EU. Belgium is committed to
R&D as a means to support the EU’s energy and climate policy objectives for sustainability,
energy security and competitiveness. The federal and regional governments aim for their
R&D policies to align with overall EU R&D policy, and Belgium’s overall R&D efforts areclosely linked with the priorities of the European Strategic Energy Technology Plan (SETPlan). Belgium participates in the SET Plan covering key actions in the following sectors:
renewables, energy systems, energy efficiency, sustainable transport, CCUS and nuclear
safety.
Within the framework of the SET Plan, Belgium’s federal and regional governments areworking with other EU member countries to define the strategic objectives of the plan’s ten
key actions. Defining these objectives will be followed by R&D activities towards achieving
these objectives through Belgium’s federal and regional R&D support programmes andco-financing of EU programmes, such as ERA-NET. Responsibility for R&D co-operation
with the EU is shared between the federal and regional governments. Co-operation on the
EU SET Plan takes place through the BELSET platform. Besides the SET Plan, ERA-NETand Horizon 2020, Belgian stakeholders also participate in various EU initiatives, notably
the European Joint Technology Initiatives (e.g. Fuels and Hydrogen 2 Joint Undertaking)and the European Institute of Technology (EIT KICs).
The EU funds R&D in all member states (including Belgium) through a research andinnovation framework programme that is updated every seven years. Horizon 2020, theresearch and innovation framework programme for 2014-2020, provided a total of83

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focused on a particular market, technology or scientific field. These clusters play a key roleas they inform R&D policy discussions and issue calls for proposals for R&D projects.

ENERGY SYSTEM TRANSFORMATION

6. ENERGY RESEARCH, DEVELOPMENT AND INNOVATION

6. ENERGY RESEARCH, DEVELOPMENT AND INNOVATION

EUR 80 billion for R&D in the EU. Horizon 2020 awarded funding through a competitive
process open to all public and private R&D entities in the EU and aimed to increase
public-private partnerships and international co-operation.
Horizon 2020 provided EUR 3.1 billion of funding for R&D in Belgium, around 5.5% of total
awarded funding (while Belgium accounts for only around 3.5% of the EU’s GDP).
Belgium’s applicants for Horizon 2020 funding had a 17.3% success rate compared to the
EU average of 12%. Around a quarter of Belgium’s Horizon 2020 funding(EUR 782 million) went to energy and climate-related R&D, including EUR 245 million for
smart, green and intelligent transport; EUR 238 million for secure, clean and efficientenergy; EUR 177 million for advanced manufacturing and processing; EUR 122 million forclimate action, environment, resource efficiency and raw materials; and EUR 0.6 million
for nuclear energy (Horizon 2020, 2021).
Horizon Europe, the EU research and innovation framework programme for 2021 to 2027,
was launched in February 2021. It aims to provide a total of around EUR 100 billion in R&D
funding, will continue to support energy-related R&D and sets goals to increaseinternational R&D co-operation (Horizon Europe, 2021). Belgium’s NECP and the regional
governments’ R&D strategies show clear interest to support Belgium’s R&D entities inwinning funding from Horizon Europe.
In 2020, the European Commission approved the CO2TransPorts project as an EU projectof common interest. The CO2TransPorts project aims to develop CO2 transportation
infrastructure connecting the Port of Antwerp, the North Sea Port and the Port ofRotterdam. Belgian companies are also participating in the Northern Lights EU project ofcommon interest, which aims to support carbon capture and storage projects in Belgium,
France, Ireland, the Netherlands, Sweden and the United Kingdom by developing
infrastructure to transport captured CO2 by ship to a storage site on the Norwegiancontinental shelf. A consortium consisting of Air Liquide, BASF, Borealis, ExxonMobil,
INEOS, Fluxys, the Port of Antwerp and Total are investigating the technical and economic
feasibility of building CO2 infrastructure in the Port of Antwerp. Under the Antwerp@C
project, the consortium aims to reduce the CO2 emissions from the port by up to 50% by
2030 (see Chapter 3).

In 2020, 23 experts from Belgium were participating in the following 14 technology
collaboration programmes: energy technology systems analysis, buildings andcommunities, district heating and cooling, energy storage, heat pumping technologies,
smart grids, user-centred energy systems, hybrid and electric vehicles, bioenergy,hydrogen, ocean energy systems, photovoltaic power systems, solar heating and cooling,
and wind energy. Belgium also participates in the IEA Committee on Energy Research andTechnology, which co-ordinates and promotes the development, demonstration anddeployment of technologies to meet challenges in the energy sector. Belgium is not partof Mission Innovation or the Clean Energy Ministerial.

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Belgium participates in IEA technology collaboration programmes, a multilateralmechanism established by the IEA to support global collaboration to advance co-operation
on research and the application of specific energy technologies. The programmes arecomposed of thousands of experts across government, academia and industry in
55 countries that co-operate on 38 technology-specific programmes. Experts can beofficially appointed by governments or join privately from industry and research entities.

Assessment
The federal and regional governments all incorporate energy R&D into their R&D policies;
however, there is a lack of a clear national vision on energy R&D. The IEA encourages thefederal and regional governments to increase co-operation on designing and implementing
energy R&D policy and support measures, with a focus on areas were national-level coordination and sharing resources can support R&D aligned with Belgium’s energy andclimate goals and R&D capacities.
The federal and regional governments should consider establishing an inter-governmental
R&D platform that creates economies of scale and increases sharing of knowledge andresearch infrastructure. The platform should be closely monitored and updated as needed
to ensure it is effective in driving better R&D co-operation across Belgium and deliveringresearch results aligned with the energy sector’s most pressing challenges. The
EnergyVille initiative in Flanders also serves as a replicable model for institutional
collaboration that could be extended across regions and include federal research entities.
Belgium’s overall R&D policy places a strong focus on maintaining industrial
competitiveness while helping industry play a role in supporting energy transition. There
are regional programmes for co-ordination with industry on R&D including Flanders’
spearhead innovation cluster programmes and Wallonia’s Smart Specialisation Strategy.
These programmes are driving R&D efforts on electrification, hydrogen, carbon capture,bio-based industry and other areas key to maintaining Belgium’s industry competitiveness.
However, there appears to be limited interregional collaboration on industrial R&D policy
and support programmes.
The federal and regional governments should examine how R&D collaboration withindustry could be conducted with a more national-level approach. The development of aninter-governmental R&D platform that identifies national-level R&D priorities would send
clear signals to industry on which R&D investments are aligned with Belgium’s climate andenergy policy goals. The federal and regional governments should also examine how R&D
funding to industry could be better co-ordinated at the national level to align with Belgium’s
most pressing energy and climate challenges.

ENERGY SYSTEM TRANSFORMATION

6. ENERGY RESEARCH, DEVELOPMENT AND INNOVATION

The federal government and Flanders have both developed hydrogen strategies that detailareas were R&D on hydrogen should be directed to support the development of ahydrogen value chain in Belgium (see Chapter 2). Wallonia is in the process of developinga Hydrogen Strategy. The regions support hydrogen R&D and industrial pilot projects,
while the federal government is focusing on the transport infrastructure needed to support

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There is also a need to increase the support for public-private co-operation on energy
R&D, as several public research institutes have noted that even when they havesuccessful projects with high technology readiness levels, they cannot find private partners
for demonstration projects. There also seem to be barriers stemming from government
requirements, e.g. in Wallonia R&D public-private partnerships must involve SMEs, but
SMEs often lack the capacity and resources to enter into such partnerships. The federal
and regional governments should work with all R&D actors to address these issues at anational level to increase the opportunity for promising products, services and technologies
to reach commercial development. The regional cluster approaches could serve as amodel for a national-level programme.

6. ENERGY RESEARCH, DEVELOPMENT AND INNOVATIONa market for hydrogen. Belgium’s private sector is also supporting R&D efforts onhydrogen, including a pilot project that will test blending of 10% hydrogen with natural gas
at a co-generation plant.
There is very limited use of geothermal energy in Belgium. However, several studies haveshown that there is a promising potential for geothermal energy to play a greater role inBelgium’s energy transition. Additional research analysing geothermal resources, andsupport for pilot projects to confirm resources and test heating and generation applications,is needed. This is especially relevant given the limited progress in introducing renewable
heating and cooling in Belgium. There has been some recent progress in this area.
Flanders has started research and analysis on the exact role of geothermal in Belgium andin July 2021 Wallonia launched a call for projects on shallow geothermal energy.
Belgium had notable success in attracting funding from Horizon 2020, which provided
EUR 3.1 billion of funding for R&D in Belgium, around 5.5% of total awarded funding (while
Belgium accounts for only around 3.5% of the EU’s GDP). Belgium’s applicants for
Horizon 2020 funding had a 17.3% success rate, compared to the EU average of 12%.
Belgium’s NECP and the R&D strategies of the regional governments show clear interest
to support Belgium’s R&D entities in winning funding from Horizon Europe. The federal
and regional governments should continue to support Belgium’s R&D entities indeveloping competitive proposals that are aligned with Belgium’s energy and climate
goals.

Recommendations:
The government of Belgium should:
 Develop a long-term energy R&D agenda to align the energy R&D policies of thefederal and regional governments with Belgium’s decarbonisation goals.
 Foster greater co-operation between all of Belgium’s R&D entities to boost knowledge
sharing and create economies of scale.

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 Incentivise public-private partnerships on energy R&D, especially to support
commercial development for promising research projects and technologies.

EC (European Commission) (2020), A new European Research Area: Commission sets
new plan to support green and digital transition and EU recovery,
https://ec.europa.eu/commission/presscorner/detail/en/IP_20_1749.
Flux50 (2021) Flux50 Energising the Future, https://flux50.com/about/who-we-are.
EnergyVille (2021), Energy Ville website, https://www.energyville.be.
Economie Wallonie (2021), S3 Wallonne: Roadmap of the DIS “Sustainable energy
systems and housing”, https://economie.wallonie.be/content/s3-wallonne-feuille-de-routedu-dis-syst%C3%A8mes-%C3%A9nerg%C3%A9tiques-et-habitat-durables%C2%A0.
Horizon 2020 (2021), H2020 country profile, https://ec.europa.eu/info/research-andinnovation/statistics/framework-programme-facts-and-figures/horizon-2020-countryprofiles_en.
Horizon Europe (2021), What is Horizon Europe? (web page),https://ec.europa.eu/info/research-and-innovation/funding/funding-opportunities/fundingprogrammes-and-open-calls/horizon-europe_en.
IEA (International Energy Agency) (2022), Energy Technology RD&D Budgets (database),https://www.iea.org/data-and-statistics/data-product/energy-technology-rd-and-d-budgetdatabase-2.

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References

ENERGY SYSTEM TRANSFORMATION

6. ENERGY RESEARCH, DEVELOPMENT AND INNOVATIONKey data (2020)
Electricity generation: 87.9 TWh (nuclear 39%, natural gas 30%, wind 15%, biofuels andwaste 7%, solar 6%, coal 2%), -2% from 2010 to 2019, -5% from 2019 to 2020
Electricity demand: 80.9 TWh (industry 50%, commercial 25%, residential 23%,transport 2%), -3% from 2010 to 2019, -3% from 2019 to 2020

ENERGY SECURITY

7. Electricity

Electricity net exports: 0.3 TWh (14.0 TWh exports, 13.7 TWh imports)

Electricity generation
From 2010 to 2020, Belgium’s electricity generation experienced notable annual
fluctuations, with a maximum generation of 94.5 TWh in 2010 and minimum of 68.7 TWhin 2015 (Figure 7.1). The main driver of these fluctuations was temporary closures atseveral of the country’s nuclear reactors for major maintenance. In 2020, all seven of
Belgium’s reactors were back in operation and accounted for 39% of total electricity
generation of 87.9 GWh.
Figure 7.1 Electricity generation by source in Belgium, 2000-2020
100

TWhNuclear

90
80

Oil

70

Hydro

60
50

Coal

40

Natural gas

30

Bioenergy and waste

20
10

Wind

0

Solar
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Source: IEA (2022), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances.

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From 2010 to 2020, Belgium’s electricity generation experienced notable variations, driven
mainly by maintenance on nuclear reactors.

7. ELECTRICITY

Belgium’s last large-scale coal-fired electricity plant closed in 2016. One small-scale(10 MW) co-generation plant using coal and other fuels is in operation, but 95% ofBelgium’s remaining coal-related electricity generation is based on gases recovered fromtwo blast furnaces used for steel production. Generation from renewables has grownsignificantly: from 2010 to 2020, generation from solar PV increased from 0.56 TWh to
5.0 TWh, and wind from 1.3 TWh to 12.9 TWh.

Electricity trade
Belgium has historically been a net importer of electricity, primarily from France and more
recently from the Netherlands. Belgium has consistently been a net importer of electricity
since 1991, but was a net electricity exporter in 2009 and again in 2019 and 2020
(Figure 7.2). Belgium’s electricity trade experienced notable fluctuations from 2010 to2020, driven primarily by lower availability of nuclear generation resulting from temporary
closures for maintenance and safety investments. In 2019, a high level of generation from
nuclear, along with increasing generation from wind and solar PV, and the commissioningof Belgium’s first interconnection with the United Kingdom, contributed to high net
electricity exports (1.9 TWh), while in 2020 exports decreased to 0.3 TWh.

Net imports

Figure 7.2 Belgium’s electricity imports and exports with neighbouring countries,
2000-2020
25

TWh
Germany

20

United Kingdom

15

Luxembourg

10

Netherlands

Net exports

5

France

0

Other

-5

Total net trade- 10

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Belgium’s electricity trade experienced notable fluctuations, driven primarily by changes in
the available level of nuclear generation.
Source: IEA (2022), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances.

Since 2011, Belgium’s electricity demand has been relatively stable, at around 84 TWh,and was 83.7 TWh in 2019 (Figure 7.3). In 2020, electricity demand dropped by 3% to80.9 TWh as a consequence of the Covid-19 pandemic. From 2010 to 2020, the industry
sector covered around half of total electricity demand, while the share of demand from theservice sector was stable at around one-quarter. The share of residential buildings was
also stable, at around 23%. The transport sector covered the remaining 2%.

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Electricity demandFigure 7.3 Annual electricity demand by sector and peak load in Belgium, 2000-2020
90

GW

TWh

80

14.5
14

70

13.5

60
50

13

40

12.5

30

12

20

11.5

10
0

11

Transport
Residentialbuildings
Servicesectorbuildings
Industry
Peak load(right axis)

IEA. All rights reserved.

Since 2011, electricity demand has been relatively stable, at around 84 TWh, and dropped to
81 TWh in 2020. Electricity demand is almost evenly divided between industry and buildings.

ENERGY SECURITY

7. ELECTRICITY

Source: IEA (2021a), World Energy Statistics and Balances (database), https://iea.org/statistics.

From 2009 to 2020, Belgium’s peak electricity demand experienced notable fluctuation,from a high of 13.9 GW to a low of 12.7 GW and was 13.3 GW in 2020. Peak demandconsistently occurs from December to January between 5:00 pm and 7:00 pm. Peakdemand is well below Belgium’s total generation capacity (23.85 GW in 2020), while
maximum import capacity was 6.5 GW in 2020.

Electricity policy
The federal government’s electricity policy is focused on increasing the share of renewableelectricity generation, increasing cross-border interconnection capacity, a securephase-out of nuclear generation by 2025, ensuring security of electricity supply, lowering
electricity costs and increasing the competitiveness of the electricity markets. The federal
government has several measures to increase the deployment of offshore wind
generation, including a competitive auction process to drive the deployment of a newoffshore wind zone (see Chapter 5).
Regional electricity policy focuses on increasing electricity generation from renewables,
distribution system flexibility and the participation of consumers in electricity markets
through smart meters, DSR, energy storage and distributed renewables (including selfconsumption).

Nuclear phase-out and capacity remuneration mechanism
Belgium’s federal Law of 31 January 2003 requires the phase-out of all nuclear electricity
generation in the country. The law was amended in 2013 and 2015 to allow the Tihange 1
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Belgium is also an active member of the multilateral Pentalateral Energy Forum, which
includes Austria, Belgium, France, Germany, Luxembourg, the Netherlands andSwitzerland. The Pentalateral Energy Forum continues to successfully pursue ever further
integration of the cross-border electricity markets of its members through the developmentof common rules and market mechanisms that promote energy security and efficient
markets.

7. ELECTRICITY

and Doel 1 and 2 reactors to remain operational until 2025. In light of the Russian invasionof Ukraine and goals to reduce fossil fuel dependency, the federal government decided in
March 2022 to take the necessary steps to extend 2 GW of nuclear capacity by ten years.
The government will amend the 2003 law to allow for this extension (see Chapter 8).
The 2021 adequacy and flexibility study conducted by the Belgian electricity TSO
estimated that Belgium’s nuclear phase-out in combination with the accelerated phase-outof thermal generation in neighbouring countries will require the deployment of 2.0-3.6 GWof new generation capacity in Belgium by 2025 and 3.2-4.1 GW by 2030. To ensure
security of electricity supply as nuclear generation is reduced, Belgium created a CRM thatuses competitive auctions to award payments for availability of capacity to encourage thedeployment of new generation, DSR and energy storage assets and theretention/upgrading of such assets already in operation. Two auctions will be held for eachdelivery year (one auction four years ahead of the delivery year and one auction one year
ahead). The first delivery year is set from November 2025 to October 2026. The electricity
TSO is responsible for running auctions and reporting on auction results in relation tosecurity of supply.
To participate in a CRM auction, a project must hold a production permit from the federal
government and a combined building and environment permit from the relevant regional
governments and present a plan covering project financing, electricity network connections
and, for gas plants, gas network connections. Projects receiving any other subsidies from
Belgium cannot participate in the CRM auctions unless they give up these subsidies.
Capacity providers selected in an auction receive monthly payments for a period of 1-15
years, with the duration of payments depending mainly on investment costs (larger more
expensive projects can submit bids for longer payment periods). Payments are based theselected bid price (EUR/MW/year) and a technology-specific derating factor.
For the first CRM auction, fossil thermal generation had the most favourable derating,e.g. combined-cycle gas turbines (CCGT) had a 91% derating (payments are based on
91% of actual plant capacity). DSR and storage deratings were based on the duration of
capacity availability and range from 11% for one hour to 65% for seven to eight hours and100% for unlimited availability (DSR only). Deratings were much lower for renewablegeneration, solar PV (4%), onshore wind (6%), offshore wind (15%) and run-of-river hydro(34%). Derating factors are reviewed annually and can be adjusted. Small changes weremade in the derating factors for CRM auctions planned in 2022, but fossil generation still
has the most favourable derating (mostly between 90% and 96%) while renewables
generation still has the least favourable derating (1% for solar to 41% for run-of-riverhydro).

The first CRM auction was conducted in October 2021 for capacity that must be operatingby 1 November 2025. The auction selected 4.4 GW of derated capacity, mainly natural
gas CCGT plants (2 GW existing and 1.6 GW from two new plants) and also 0.36 GW ofexisting co-generation, 0.29 GW of existing DSR and around 0.1 GW of other technologies,
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The availability of capacity from projects selected in an auction is monitored and subject
to testing by the electricity TSO. Penalties are applied if contracted capacity is unavailable.
The CRM is financed through a federal excise duty that is charged to all electricity
consumers (the duty also finances other programmes). The federal excise duty is set at alevel guaranteeing that the federal component of electricity bills remains the same or
decreases.

including some new battery storage (40 MW). The average price for selected bids wasaround 32 000 EUR/MW/year, while the highest selected bid was around
50 000 EUR/MW/year. The two new CCGT plants (one in Vilvoorde and one in Les Awirs,
both with award capacity around 0.8 GW) have CRM contracts for 15 years. Payments tothese plants from 2025 to 2040 are estimated to total between EUR 750 million and
EUR 1.2 billion. The total cost of the CRM will depend on the number of future auctions
and the prices and capacities awarded in those auctions.
The regional environmental permit of the proposed new gas plant at Vilvoorde was refusedby Flanders in November 2021. In March 2022, the federal government cancelled thecontract for the Vilvoorde plant and instructed the electricity TSO to reopen the October
2021 auction to select additional projects from already submitted bids to ensure electricity
adequacy in the 2025 delivery year. It is expected that this will result in a new CRM contract
with a gas-fired power plant of similar capacity (around 0.8 GW) that has all the needed
permits in place.

ENERGY SECURITY

7. ELECTRICITY

Social tariff
To address energy poverty and ensure energy access, Belgium has a social tariff thatlowers the electricity and natural gas bills of residential consumers that meet certain
socio-economic requirements. The cost of the social tariff is coved by a fee charged to allenergy consumers in Belgium (see Chapter 2). From 2017 to 2019, there was a steadyincrease in the number of electricity consumers receiving the social tariff (Table 7.1).
In 2020, eligibility for the social tariff was expanded in response to the Covid-19 pandemic,
resulting in a large increase in the number of electricity consumers receiving the social
tariff (CREG, 2021a).
Table 7.1 Electricity social tariff in Belgium, 2017-2020
Electricity social tariff
Year

Consumers covered
NumberShare of consumers

Reduction versus averageretail tariff

2017

426 2998.8%-36.4%

2018

434 161

9.0%-34.2%

2019438 3099.1%-33.6%

2020

470 305

9.7%-30.5%

Belgium’s electricity market has been liberalised and fully open to competition since 2007.
There is legal separation between commercial activities and network operations. Use of
the electricity networks is open to any company wishing to supply electricity to end users.
Consumers are free to choose the supplier of their choice and prices are determined bymarket forces.
Regulatory responsibility over the Belgian electricity market is divided between the federal
regulator, the Commission for Electricity and Gas Regulation (CREG), and the three
regional regulators: the VREG in Flanders, the CWaPE in Wallonia and the Brugel in the93

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Market structure

7. ELECTRICITY

Brussels-Capital Region. The regulatory authorities are independent, both from market
players and from policy makers. The CREG is responsible for the electricity transmission
system, including approval of transmission tariffs, and also advises the federal government
on gas and electricity markets. The VREG, CWaPE and Brugel approve distribution tariffs
and regulate electricity distribution and compliance with regional public service obligations.
They also advise each regional government on the operation of the gas and electricity
markets. The regional regulators monitor retail market competition in their respective
regions, while the CREG monitors wholesale market competition.

Wholesale market
Belgium is part of a wholesale electricity market that links over 20 European countries.
This market has been consistently expanded and more tightly integrated as part of theongoing project to create a single European internal electricity market. The wholesalemarket manages day-ahead and intraday electricity trading between interconnected
European bidding zones. Most bidding zones are correlated with national borders andBelgium is a single bidding zone.
In 2019, 19 companies were able to participate as wholesale electricity suppliers in
Belgium (down from 21 in 2018). The wholesale electricity market in Belgium is highly
concentrated with limited competition. In 2019, Electrabel alone had 72% of the market
share in terms of electricity generated, followed by EDF Luminus (16%) and T-Power (4%).
The Herfindahl-Hirschmann Index (HHI) score for the Belgian wholesale market was
5 450 points in 2019, down from 6 868 in 2009, but still reflecting high market
concentration.

Retail market

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Flanders, Wallonia and the Brussels-Capital Region each have separate retail electricity
markets, overseen by their respective energy regulators, with different tariff structures andmarket rules. Belgium’s retail electricity markets are more competitive than the wholesalemarket. In 2019, Belgium’s combined retail electricity markets had HHI scores of 2 440,
down from 2 735 in 2018, indicating a moderate to high level of market concentration.
In 2019, 36 retail electricity suppliers were active in Flanders, 36 in Wallonia and 21 in theBrussels-Capital Region, with the 4 largest suppliers having dominant market shares(72-82%) in all 3 regional markets (Table 7.2).

Table 7.2 Share of electricity supplied by the main retail electricity suppliers in
Belgium’s regions, 2019
Electricity suppliers

Flanders

Wallonia

Brussels-Capital
RegionElectrabel

39.9%

39.9%

51.7%

Luminus

18.9%

24.1%

16.0%

Lampiris

5.1%

10.9%

12.6%

Eneco Belgium

8.0%

6.7%

6.7%

Others

28.1%

18.4%

19.7%

Between 2017 and 2019, the rate for retail electricity consumers switching suppliers
increased from 18.6% to a record high of 23%, which was the highest switching rate among
European countries (ACER, 2020). By region, while the switching rate in Flanders andWallonia in 2019 was relatively high, at 25.8% and 22.0% respectively, in theBrussels-Capital Region, the rate was 6.4% for households and 10.6% for SMEs.

ENERGY SECURITY

7. ELECTRICITY

The regional governments created public service obligations that prevent consumers who
are unable to pay their electricity or gas bills from being disconnected. The details of the
public service obligations vary between the regions, but in general consumers who cannot
pay their energy supplier (dropped consumers) receive gas or electricity from a supplier oflast resort. Flanders and the Brussels-Capital Region have assigned the role of supplier oflast resort to distribution system operators (DSOs). In Wallonia, the supplier of last resort
is set by the DSO based on which supplier is designated as the historic incumbent, thoughanother supplier can be given this role by the DSO. Different systems, including prepaid
meters and regulated tariffs, are used to ensure dropped consumers continue to receive
electricity and gas while paying their debts to energy suppliers.
From 2017 to 2019, the share of dropped electricity consumers increased from 81 012(1.7% of electricity consumers) to 85 332 (1.8% of electricity consumers). In response to
the Covid-19 pandemic, changes were made to increase protection for dropped
consumers and it is expected that the number of dropped consumers increased in 2020.

Retail prices and taxes

Belgium’s industry electricity price declined notably in 2014-15, but has since increased
and remains higher than prices in France, the Netherlands and Luxembourg. Belgium’s
household electricity price declined notably from 2013 to 2015, but has since experienced
a sharp increase, almost reaching the price in Germany, which has the highest household
electricity price among IEA member countries. The higher electricity prices in Belgium
result mainly from the high level of public service obligations, surcharges and levies
compared to most of its neighbouring countries. The notable increase in household
electricity prices from 2015 to 2019 resulted mainly from increases in network tariffs(CREG, 2021b).
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Retail electricity prices in Belgium are composed of wholesale electricity costs, network
tariffs, federal taxes and VAT. In 2019, Belgium’s average retail electricity price forindustrial consumers was the sixth-highest among IEA member countries (135 USD/MWh,with a tax rate at 25%), while the average retail electricity price for household consumers
was the third-highest among IEA member countries (316 USD/MWh, with a tax rate of59%). Belgium has relatively high electricity prices compared to the countries it iselectrically interconnected with (Figure 7.4).

7. ELECTRICITY

Figure 7.4 Electricity prices in Belgium and neighbouring IEA countries, 2009-2019
Industry
180

Household

USD/MWh

400

160

350

140

300

120

250

100

200

80
60
2009

USD/MWh2011

2013
Belgium

2015
France20172019

Luxembourg

150
2009
Netherlands

2011

2013

2015

2017

United Kingdom

2019

Germany
IEA. All rights reserved.

Belgium has relatively high electricity prices compared to countries it is electricallyinterconnected with.
Source: IEA (2021b), Energy Prices and Taxes 2020 (database), https://iea.org/statistics.

Infrastructure
Belgium has a well-developed and highly interconnected electricity system serving
domestic demand and supporting the European electricity market. Belgium’s electricity
network is one of just a few networks in the world to make extensive use of dynamic line
rating (DLR). DLR uses distributed sensors to provide real-time monitoring of high-voltage
electricity lines. DLR allows the TSO to better determine actual line capacity and improveoverall system performance. In 2020, the TSO was using DLR on 28 high-voltage lines
and estimated that DLR had increased Belgium’s import and export capacity by around
10%, resolved congestions issues, and reduced redispatching costs and curtailment of
renewable generation (Renewables Grid Initiative, 2018).

Generation and storage capacity

Most of Belgium’s generation capacity is composed of large-scale generation assets(centralised plants or large wind and solar PV parks) connected to the electricity
transmissions system (around 16 GW in 2020). However, a notable share of capacity(around 8 GW in 2020) is connected at the distribution level and this capacity has been
increasing, especially small-scale distributed solar PV systems connected to the
low-voltage networks.
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In 2020, Belgium’s total electricity generation capacity was 23.85 GW, with Belgium’s two
nuclear plants accounting for 25% of total capacity, followed by natural gas (24%), solar
PV (23%), wind (20%), hydro (6%), and small shares from bioenergy and oil (Table 7.3).
Ownership of Belgium’s generation capacity is highly concentrated. From 2013 to 2020,
there was an increase in total installed capacity (+2.9 GW) and a notable shift in the mixof generation assets, with a large increase in wind and solar PV capacity offset by reduced
capacity for natural gas, coal, oil and biomass. In 2019, Electrabel owned 69% of the total
generation capacity, followed by EDF Luminus (16%) and T-Power (1.7%).

Table 7.3 Electricity generation capacity by type in Belgium, 2013 and 2020
Capacity (GW)

2013

2020

Change

Total

20.95

23.85

+2.9

Nuclear

5.94

5.94

0

Natural gas

6.63

5.76

-0.87

Solar PV

2.90

5.50

+2.60

Wind (total)

1.78

4.76

+2.98

Offshore wind

0.71

2.26

+1.55

Onshore wind

1.07

2.50

+1.43

Hydro (total)

1.43

1.41

-0.02

Pumped storage

1.31

1.31

0

Coal

0.76

0

-0.76

Oil

0.29

0.18

-0.11

Biomass

0.72

0.60

-0.12

Other

0.98

0.92

-0.06

ENERGY SECURITY

7. ELECTRICITY

Belgium’s pumped hydro storage (1.31 GW in 2020) plays an important role in systembalancing. Belgium has limited battery storage capacity. There are no official consolidated
data on battery storage, as this is not yet part of the mandatory energy statistics. A firstunverified compilation of operational battery projects used for grid balancing was
conducted in September 2021 and estimated capacity around 32.5 MW/30 MWh.
However, the government indicated that this estimate is likely well below the actual
capacity of operational battery storage. Belgium’s battery storage capacity is expected toincrease, as a 25 MW/100 MWh system is planned for 2022 (Renews, 2021). Flanders
aimed for at least 5 000 home battery systems with a combined storage capacity of around
25 MWh will be installed by the end of 2021.

Transmission
The private company Elia is the Belgian electricity TSO. Elia is owned by the Elia Group,
which also owns the German TSO 50Hertz. Around 48% of the shares of the Elia Groupare held by two public holding companies (Publi-T and Publipart), which are owned by
Belgium’s municipalities. The remaining shares are traded on the Euronext Brussels Stock
Exchange (Elia Group, 2021).

Interconnections
In 2020, Belgium had interconnections to France, Luxembourg and the Netherlands via
12 high-voltage alternating current (AC) lines; with the United Kingdom via the Nemo Link
HVDC subsea cable; and with Germany via the Aachen Liège Electricity Grid Overlay
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Elia operates the high-voltage electricity transmission network (30-380 kilovolts [kV]) that
supports transmission of electricity across Belgium and electricity trading via the crossborder interconnectors. The part of the network from 70 kV to 380 kV is regulated by the
CREG and the federal government. The part of the network from 30 kV to 70 kV isregulated by the regional regulators and governments. Most of the electricity supplied by
the high--voltage transmission network is delivered via transformer substations to
Belgium’s electricity distribution networks, which serve the majority of consumers.
However, the transmission system also directly supplies a large number of heavy industrial
consumers.

7. ELECTRICITY(ALEGrO) HVDC underground cable (Figure 7.5 and Table 7.4). Belgium’s maximum
technical interconnection capacity was 6.5 GW in 2020. Projects under development will
expand Belgium’s interconnection capacity with the Netherlands and increase maximum
technical interconnection capacity to 8.4 GW.
Figure 7.5 Electricity infrastructure in Belgium

Table 7.4 Belgium’s electricity interconnectors, 2020
Location

Substation 2
Name

LocationLine rating
Kilovolts

Amps

Monceau

Chooz

220 AC

1 058

Aubange

Schifflange

220 AC

1 037

220 AC

1 037

220 AC

1 160

Moulaine

220 AC

1 160

Lonny

380 AC

1 999

380 DC

1 520

380 AC

2 186

380 AC

1 999

380 AC

2 499

Rilland

380 AC

2 499

Mastaing

380 AC

1 999

380 AC

2 322

380 DC

1 555

AubangeAubangeAubange

Wallonia,
Belgium

AcheneSanem

AlegroOberzier

Van Eyck

Maasbracht

Van Eyck

Maasbracht

Zandvliet
Zandvliet
Avelgem

Flanders,
Belgium

FranceMoulaine

Germany

Netherlands

Rilland

AvelgemAvelinGezelleKent

FranceUnited Kingdom

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Substation 1
Name

Elia operates the interconnections in co-operation with TSOs in the connected countries,
with cross-border capacity allocated under common European market rules. Under EU
rules, Belgium has binding targets for cross-border electricity interconnection capacity.
The target is based on the ratio of interconnection import capacity and domestic generation
capacity. Belgium met its 2020 target of 24% and has a 2030 target of 33%.

Distribution
Belgium’s distribution system is composed of medium- and low-voltage networks (below
30 kV) and serves the majority of electricity consumers, with 4 825 659 connection points
in 2020. Belgium’s municipalities have a legal monopoly on electricity and gas distribution
and own the electricity and gas distribution networks. Nearly all municipalities havetransferred responsibility for electricity and gas distribution to inter-municipal companies,
which are the DSO for the assigned section of the network. In 2019, there were
16 electricity DSOs in Belgium, 10 in Flanders, 5 in Wallonia and 1 (Sibelga) in theBrussels-Capital Region.

ENERGY SECURITY

7. ELECTRICITYElectricity security
Belgium has electricity crisis management policies in line with national, regional andEU-level obligations. The Directorate-General for Energy (DGE) of the Federal PublicService Economy (FPS Economy), under the guidance of the federal Minister for Energy,
is working on the implementation of the EU Risk Preparedness Regulation for theelectricity sector (EU Regulation 2019/941). The Risk Preparedness Regulation provides
a framework for EU member states to establish risk preparedness plans, enhancing rules
for co-operation between member states to prevent, prepare for and manage electricity
crises. Accordingly, at the national level, the Risk Preparedness Plan of Belgium which is
being prepared pursuant to the Risk Preparedness Regulation will offer a framework forexisting contingency procedures and measures and will serve as a starting point for further
actions concerning the prevention, preparation for and mitigation of electricity crises. The
first version of the Belgian Risk Preparedness Plan for the Electricity Sector was finalisedin January 2022. The majority of the identified measures and procedures have alreadybeen implemented. Work to implement the remaining measures started in mid-2021.

•

the Royal Decree of 22 April 2019 on the technical regulation concerning the operation
and access to the transmission network (the Federal Grid Code)•the Ministerial Decree of 3 June 2005 on the establishment of the load-shedding planof the electricity network.

The Federal Grid Code creates a legal basis for the Ministerial Decree of 3 June 2005 on
the establishment of the load-shedding plan. In turn, the load-shedding plan as defined in
the ministerial decree is embedded in the System Defence Plan developed by theelectricity TSO, Elia. To ensure a level of risk preparedness at the level of the TSO, thefederal Minister for Energy is granted approval authority concerning the TSO’s System
Defence Plan, the Restoration Plan and the Test Plan, pursuant to the Federal Grid Code.

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In addition to the EU Risk Preparedness Regulation, the core national legal framework forelectricity crisis management in Belgium consists of two key documents:

7. ELECTRICITY

Emergency response and management
Belgium has a comprehensive electricity security framework in place to manage short-term
emergency situations and to assure the resilience of its infrastructure against disruptions.
In line with requirements imposed by the EU Risk Preparedness Regulation, Belgium hasdeveloped numerous electricity crisis scenarios to assist in identifying the necessary
emergency response measures to deal with electricity shortfalls. The procedures for
dealing with very short-term, sudden shortfalls have to be updated in light of structuralchanges in the crisis management legal framework.
In the event of an emergency situation within the Belgian electricity system, aload-shedding plan can be activated as a central element of Belgium’s short-term
electricity emergency response measures. The load-shedding plan, established inaccordance with the Federal Grid Code as already discussed, is developed by Elia, whichis responsible for implementing the plan to address disruptions of the electricity system.
The Decree of 3 June 2005 sets rules on the order for disconnecting and reconnecting
consumers.
The current load-shedding plan can be activated both automatically, in the event of asudden frequency drop on the high-voltage grid, or manually, as a last-resort measure incase of an anticipated power shortage. If regular measures taken by Elia to address asystem disruption are not sufficient, Elia must notify the federal Minister for Energy and
the National Crisis Centre of the threat of an electricity shortfall. If the initially proposed
measures are insufficient, Elia will be required by the government to activate the manualload-shedding plan to reduce the energy demand of a limited number of consumers for thetime necessary. This involves disconnecting DSOs’ substations from the grid to keep thesystem balanced and prevent a general blackout across all of Belgium. If this plan is
activated, various high-voltage substations belonging to a single load-shedding group will
have to be disconnected simultaneously.
Furthermore, since 2018, Elia has contracted a strategic reserve to ensure security ofsupply at times of short-term problems with nuclear power plants, as well as the envisaged
phase-out of nuclear by 2025, discussed later. The strategic reserve aims at meeting peakdemand during winter periods when the market fails to do so. It takes two forms: thestrategic reserve delivered by generation units (SGR) and the strategic reserve deliveredby a reduction in the offtake on the demand side (SDR). Each year the Minister for Energy
may instruct Elia to define the strategic reserve for the upcoming winter period, specifying
the required strategic reserve volume in MW.

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After a tender process based on rules set by Elia in consultation with the market players,
the CREG and the federal government, the volumes and prices of the reserves can be
imposed on the selected tenderers for the required period. The remuneration varies,
depending on whether the suppliers are offering SGR or SDR. The remuneration for the
SGR covers the expenses incurred by the supplier for keeping available and generating
the energy at Elia’s request, taking account of the cost of the fuels and overheads, and forthe period of activation and the volume injected in MWh. For the SDR, suppliers are
remunerated for the availability of the contracted capacity and for the activation of the SDR.

Electricity system performance
The Belgian electricity transmission and distribution networks are supported throughnotable investments by the TSO and DSOs to minimise the number, duration and impact
of system disruptions and level of losses. In this context, the system average interruption
frequency index (SAIFI: average number of unplanned power system outages per year),the system average interruption duration index (SAIDI: average number of minutes of
unplanned power system outages per year) and energy not supplied (ENS: MWh ofelectricity demand requested but not supplied per year) are good parameters of thereliability of the grid.
In 2020, the SAIDI and ENS value for the transmission network sharply declined compared
to 2019 while the value for SAIFI increased (Table 7.5). The TSO indicates that in 2019
there was one big customer interruption of around 500 MWh caused by the customer,in 2018 there was an interruption of around 450 MWh at a substation due to a third party
and in 2017 a customer lost around 1 500 MWh due to a fault at their installation. SAIFI
and SAIDI for the distribution network declined in 2020 compared to both 2019 and thefive-year average (Table 7.6). In 2020, the average SAIFI and SAIDI indicators in the
EU-27 were 0.92 and 1.01, which indicates that the electricity distribution network in
Belgium is relatively reliable among EU member countries.

ENERGY SECURITY

7. ELECTRICITY

Table 7.5 Change of values by supply indicators for transmission networks in
Belgium, 2016-2020
Indicator

2016

2017

2018

2019

2020

5-yearaverage

SAIFI (interruptions)

0.09

0.06

0.09

0.07

0.14

0.09

SAIDI (minutes)

40.14

245.92

62.28

93.25

25.80

93.48

ENS (MWh)451.65

1927.80711.25732.15417.10847.99

Table 7.6 Change of values by supply indicators for distribution networks in Belgium,
2016-2020
2016

2017

2018

2019

2020

5-yearaverage

SAIFI (interruptions)

0.57

0.53

0.43

0.66

0.41

0.52

SAIDI (hours)

0.5

0.5

0.4

0.6

0.4

0.5

Indicator

The Belgian electricity sector will be subject to major changes in the next decade. First,
the share of renewables in the electricity generation mix is expected to almost double, froman estimated 20.9% in 2020 to more than 37% in 2030. Second, Belgium’s nuclear power
plants, which currently produce almost half of the electricity generated in the country, will
be phased out under current law before the end of 2025.

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Assessment

7. ELECTRICITY

To ensure electricity supply during the nuclear phase-out and beyond, Belgium hasdeveloped a CRM. The CRM represents a notable change, as Belgium has an energy-only
electricity market (payment only for generation delivered to consumers). The first CRM
auction took place in October 2021 and awarded payments to 4.4 GW of capacity, mainly
natural gas (2.0 GW existing and 1.6 GW new). The regional environmental permit of oneof the proposed gas plants was refused. In March 2022, the federal government cancelled
the contract for this plant and instructed the electricity TSO to reopen the October 2021
auction to select additional projects from already submitted bids to ensure electricity
adequacy in the 2025 delivery year. It is expected that this will result in a new CRM contract
with a gas-fired power plant of similar capacity (around 0.8 GW) that has all the needed
permits in place.
The auction results raise some concerns on the ability of all technologies to compete in
the auction process and on increasing carbon intensity of generation. The CRM aims to
be technology neutral, but in the first auction, a single technology (natural gas CCGT)
accounted for 87.2% of submitted bids and 80.6% of selected capacity (3.6 GW). Almost
all support for the construction of new projects also went to gas CCGT (1.6 GW). The only
other new projects winning support were around 40 MW of battery storage. The auction
did award support to 0.4 GW of existing DSR capacity (9.8% of selected capacity). The
auction did not attract any bids from renewable generation (new or existing) or new DSR
capacity. The federal government should examine the auction rules and consider revisions
that would increase the technological diversity of bids and awarded support in future
auctions.
The results of the first CRM auction also show that natural gas will play a much larger rolein Belgium’s energy system and this will increase the carbon intensity of electricity supply
and increase GHG emissions. Belgium has rules requiring that new gas-fired power plants
achieve certain emissions reductions by 2035 and by 2045, and that they arecarbon-neutral by 2050. The IEA emphasises the need to develop a clear vision on thelong-term role of gas-fired plants in the Belgian electricity system, especially in the context
of Belgium’s goals for renewable generation and decarbonisation. The IEA recommends
developing a clear plan to reduce the climate impacts of gas-fired generation, to provide
guidance to investors and avoid stranded assets.

CRMs can have high costs and distort electricity markets and price formation. They should
therefore only be implemented as a last-resort measure, after the expectation of adequacy
problems has been convincingly established. Additionally, CRMs should be designed tominimise market distortions and harness competitive pressures as much as possible tolower the overall costs of the CRM. As Belgium moves forward with implementing its CRM,
it should pay close attention to these potential impacts and be ready to make adjustments
to the CRM as needed.

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The federal government has expressed concerns over the timely deployment of new
projects selected in the CRM (e.g. delays in regional permits, legal challenges, etc.). The
federal government should closely monitor the CRM results, including progress on the
deployment of new projects selected in the auctions, and work with the regional
governments to identify and mitigate risks to timely deployment. This includes ensuringthat permitting requests are processed and delivered in a transparent and timely mannerand that supporting infrastructure (electricity and gas networks) is in place.

In light of the Russian invasion of Ukraine and goals to reduce fossil fuel dependency, thefederal government decided in March 2022 to take the necessary steps to extend 2 GW ofnuclear capacity by ten years. The extension of the 2 GW of nuclear capacity requires
notable investments at Belgium’s two nuclear plants and completion of complex regulatory
processes. It is expected that no nuclear generation will be available the winter of 202526 and that the steps needed to complete the extension of the 2 GW of capacity will not
be completed until 2026 or later.
Belgium’s electricity system is highly interconnected with its neighbouring countries. Two
new cross-border connections have been constructed in recent years and the Belgian
electricity system is now connected to all four neighbouring EU member states and theUnited Kingdom. Total interconnection capacity has increased to 6.5 GW (compared topeak demand of 13.8 GW in 2019) and a corresponding interconnection level of 24%(based on the ratio of interconnection import capacity and generation capacity), whichmeans Belgium has met its EU 2020 interconnection target (24%). Belgium has set a 2030
interconnection target of 33% that will require a continued commitment to interconnection
investments and co-operation with its neighbouring countries.

ENERGY SECURITY

7. ELECTRICITY

The wholesale electricity market in Belgium remains highly concentrated. In 2019, one
generation company (Electrabel) covered 72% of the generation market, similar toprevious years. Nonetheless, competitive pressure in the wholesale electricity market has
most likely increased due to increased interconnection capacity enabling cross-border
trade. The future development of the level of concentration is uncertain and highly
dependent on the outcome of the CRM, and to a lesser extent on the outcomes of theauctions for offshore wind generation and developments in distributed generation anddemand response.
The electricity switching rate for households in Belgium was 23% in 2019, the highest
switching rate in Europe. Furthermore, steps have been taken in recent years to improvethe efficient functioning of the retail market. Specifically, customer-oriented provisions of
the EU Clean Energy Package are in the process of being implemented by regional
governments, the roll-out of smart meters has continued and a new law has been proposed
to address the high share of inactive customers with high-priced energy contracts.
However, the Belgian retail market for electricity has remained moderately to highly
concentrated and important barriers and distortions remain.

As the Belgian energy system decarbonises and electrification increases, the importanceof the efficient functioning of retail markets for electricity grows. Increasingly, electricity
retail customers will evolve from simple consumers with predictable consumption patterns
to active participants with increasingly diverse and less predictable consumption andgeneration patterns. Existing trends and research confirm growth in small-scale solar, EV
fleet, increasing electrification of residential heating and installation of small-scale
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The IEA highlights the recommendation from its 2016 energy policy review of Belgium toevaluate the possibilities to improve price signals and to remove cost elements that are
unrelated to the supply of electricity. Since the 2016 review, the non-supply related part ofthe electricity bill has remained high. Analysis by the CREG shows that approximately
one-third of the electricity price paid by households is made up of taxes and levies. Of theremaining two-thirds, a substantial part is earmarked for public service obligations charged
through both the retail price and the TSO and DSO tariff. High electricity prices hamper
electrification of hard to decarbonise sectors like transport and residential heating.

7. ELECTRICITY

batteries. These developments underscore the importance of a market design that sends
appropriate price signals to drive the behaviour of retail customers, minimise distortions
and cross-subsidies, and incentivise the market to develop new and innovative retailpropositions.
The presence of smart meters is a precondition to an efficient retail market. Each of theregional governments has targets for the installation of smart meters. Flanders is aimingfor 80% of connections to have smart meter by the end of 2024 (100% by 2029). In
Wallonia and the Brussels-Capital Region, complete or near-complete coverage is notexpected until after 2030. The IEA emphasises smart meters are enablers of retail market
development, not simply a technology to accompany market developments already taking
place. The timeline for smart meter installation in Wallonia and the Brussels-Capital Region
can impede retail market development and should be accelerated. The Brussels-Capital
Region has indicated that the revision of its electricity ordinance could lead to an
accelerated roll-out. Wallonia has indicated it will not accelerate the roll-out, but thatincentives are provided for switching to a smart meter.
Flanders, Wallonia and the Brussels-Capital Region have separate retail electricity
markets. This results in important regulatory differences between the regions, for instancewhen it comes to supply licensing and compliance, regulations on data access, rules on
dynamic pricing, and DSO tariff structures. Furthermore, disparate implementation ofprovisions in the EU Electricity Directive on active customers, citizen energy communities
and aggregation is likely to impede interregional participation in energy communities,
aggregation of flexibilities and exchange of electricity through peer-to-peer platforms.
Although the IEA understands and respects the inter-governmental division ofcompetencies, disparate market frameworks create major impediments to suppliers andother market participants that want to develop innovative retail propositions. A February
2021 report by the European Commission on retail markets similarly emphasises thenegative effects of this regulatory divergence.
Belgium has a well-developed, highly interconnected and reliable electricity network. At
regular intervals, the TSO and DSOs publish network development plans (NDP) outlining
their planned infrastructure expansions and reinforcements. Timely and sufficient
expansion and reinforcement of electricity grids and the use of flexibility instruments is
crucial to allow for effective expansion of renewable electricity generation, electrification ofindustrial demand, a growing EV fleet, small-scale solar PV, demand-side management,
and new import and export flows.

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For this purpose it is essential that NDPs are based on the most up-to-date information,
have an appropriate forward horizon and take developments in other connected networks
into account. Currently, the TSO develops a new NDP every four years and considers aten-year forward horizon. The NDPs of DSOs have varying, much shorter forward
horizons, and are established every year or two. More frequent revision of the transmission
NDP, a longer forward horizon for distribution NDPs and a harmonisation of planning
cycles for NDPs would reduce the risk of future market developments being impeded bylagging network development. Flanders has drawn up the legal framework to meet thisrequirement.

Recommendations
The government of Belgium should: Work with the regional governments to ensure the lifetime extension of 2 GW ofnuclear generation and projects selected in the capacity remuneration mechanism canbe completed in a timely and cost effect manner.
 Assess without delay the need to extend the strategic reserve beyond 2022 up to the
expected implementation of the capacity remuneraatin mechanism in 2025 and, if theneed is established, promptly start notification procedures.
 Together with the regional governments, evaluate possibilities to improve price signals
in the electricity retail market by removing cost elements that are unrelated to the
supply, distribution or transmission of electricity.
 Encourage a more ambitious roll-out of smart meters in Wallonia and theBrussels-Capital Region.

ENERGY SECURITY

7. ELECTRICITY

 Together with the regional governments, work to minimise barriers to retail market
development by harmonising regional market regulations, in particular when
implementing the revised EU Electricity Directive.

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 Revise the transmission network development plan more frequently and encourageregional governments to pursue a more harmonised approach for establishing
distribution network development plans with longer outlooks.

7. ELECTRICITY

References
ACER (European Union Agency for the Cooperation of Energy Regulators) (2020), ACER
Market Monitoring Report 2019,https://documents.acer.europa.eu/Official_documents/Acts_of_the_Agency/Publication/AC
ER%20Market%20Monitoring%20Report%202019%20%20Energy%20Retail%20and%20Consumer%20Protection%20Volume.pdf.
CREG (Electricity and Gas Regulatory Commission) (2021a), Tarif social [Social tariff](web page), https://creg.be/fr/consommateur/tarifs-et-prix/tarif-social (accessed on 7 May2021).
CREG (2021b), A European Comparison of Electricity and Natural Gas Prices for
Residention, Small Professional and Large Industrial Consumers,
https://www.creg.be/fr/publications/etude-f20210517 .
Elia Group (2021), Legal structure (web page), https://eliagroup.eu/en/investorrelations/legal-structure.
IEA (International Energy Agency) (2022), World Energy Balances (database),https://www.iea.org/data-and-statistics/data-product/world-energy-balances (accessed on
18 February 2022).
IEA (2021b), Energy Prices and Taxes 2020 (database), https://iea.org/statistics (accessedon 7 May 2021).
Renewables Grid Initiative (2018), Dynamic Line Rating (DLR) (web page),https://renewables-grid.eu/activities/bestpractices/database.html?detail=198&cHash=9d594b40e43e87d5925daaa33276a974.

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Renews (2021), Clean power newbie reveals 25 MW Belgian battery plan (web page),https://renews.biz/65615/clean-power-newbie-reveals-25mw-belgian-battery-plan.

ENERGY SECURITY

8. Nuclear
Key data (2020)
Number of reactors: seven reactors, two power plants
Installed capacity: 5.94 GW
Electricity generation: 34.4 TWh, -28% since 2010
Share of nuclear: 17.8% of total energy supply, 39.2% of electricity generation

Overview
Nuclear energy has historically provided over half of Belgium’s electricity generation(Figure 8.1). Belgium has seven nuclear reactors located at two nuclear power plants: Doelin Flanders (four reactors) and Tihange in Wallonia (three reactors), with a combined
generation capacity of 5.94 GW (Table 8.1). From 2012 to 2020, electricity generation from
nuclear experienced notable annual variations resulting from a combination of technical,
regulatory, policy and external factors, and leading to an average capacity factor of 68.3%.
In 2020, all seven of Belgium’s reactors were once again fully operational, with nuclear
availability reaching up to 92% in 2021.
Figure 8.1 Electricity generation from nuclear and share of total in Belgium,
2000-2020
60

TWh

60%

50

50%

40

40%

30

30%

20

20%

10

10%

0

0%

NuclearShare ofelectricity
generation(right axis)

Nuclear covered almost half of total electricity generation in Belgium in 2020. Startingin 2012, strong fluctuations of nuclear energy resulted from temporary shutdowns of reactors.
Source: IEA (2022), World Energy Balances (database), https://www.iea.org/data-and-statistics/data-product/worldenergy-balances.

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8. NUCLEAR

All seven of Belgium’s reactors are operated by the private company Electrabel, a wholly
owned subsidiary of ENGIE. Electrabel owns 50% of Tihange 1, 89.8% of Tihange 2 andTihange 3, 100% of Doel 1 and 2, and 89.8% of Doel 3 and 4. The private company
Luminus owns 10.2% of Tihange 2 and 3 and Doel 3 and 4. EDF Belgium owns a 63.5%
stake in Luminus, and also holds a 50% stake in Tihange 1.
Table 8.1 Nuclear capacity in Belgium in 2020 and connection dates
Doel 1
Doel 2
Doel 3
Doel 4
Doel total
Tihange 1
Tihange 2
Tihange 3
Tihange total
Nuclear total

Reference unit power (GW)

Started commercial operation

0.45
0.45
1.01
1.04
2.93
0.96
1.01
1.04
3.01
5.94

1975
1975
1982
1985
1975
1983
1985

Nuclear policy
The federal government is responsible for Belgium’s nuclear energy policy, which is
focused on phasing out most nuclear electricity generation in a secure manner by 2025;
ensuring safe disposal of nuclear waste and spent reactor fuel; and maintaining expertisein nuclear energy RD&D. The Federal Agency for Nuclear Control is the regulatory bodyin charge of nuclear safety, licensing and delicensing, under the supervision of the Ministerfor the Interior.

Following a decision of the Court of Justice of the European Union, the Belgian
constitutional court ruled that the law passed in 2015 to grant ten-year extensions to Doel 1
and 2 should have been preceded by environmental impact assessments. The Belgian
court concluded that it would allow the law to remain in force until the end of 2022 foradoption of a new law enabling extended operation of these units that is properly precededby the needed environmental impact assessment. Following this ruling, the federal
government and Electrabel initiated preparation of the environmental impact assessmentwith independent environmental experts. All affected parties within a radius of 1 000 km of
the Doel plant were notified in 2020. National and transboundary consultations with thegeneral public and relevant competent authorities were carried out in 2021. Consultations
with affected parties are still ongoing.
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Belgium’s federal Law of 31 January 2003 requires the phase-out of all nuclear electricity
generation in the country. The law was amended in 2013 and 2015 to provide for the
Tihange 1, Doel 1 and 2 reactors to remain operational until 2025. In light of the Russian
invasion of Ukraine and goals to reduce fossil fuel dependency, the federal government
decided in March 2022 to take the necessary steps to extend 2 GW of nuclear capacity(Tihange 3 and Doel 4) by ten years, including modifying the 2003 law. Under this new
arrangement, most of Belgium’s nuclear generation capacity will be phased out by 2025
(Figure 8.2).

Figure 8.2 Planned reductions in nuclear generation capacity in Belgium, 2021-2025
6

GW

Doel 3-1.01 GW

5

Tihange 2-1.01 GW

4Doel 1-0.45 GW

3

Tihange 1-0.96 GW

2

Doel 2-0.45 GW

1
0

2021

Oct-22

Apr-23

Feb-25Oct-25

Dec-25IEA. All rights reserved.

ENERGY SECURITY

8. NUCLEAR

To ensure electricity supply during the nuclear phase-out and beyond, the federal
government has developed a CRM that uses auctions to support the deployment ofadditional generation capacity and retention of existing capacity. The first CRM auction
was conducted in October 2021 and awarded payments to 4.4 GW of capacity, mainly tonatural gas – both existing plants (2.0 GW) and for two new plants (1.6 GW) – and smaller
amounts to existing co-generation, DSR and other technologies. The regional
environmental permit of one of the proposed new gas plants was refused in November
2021. In March 2022, the federal government cancelled the CRM contract for this plantand instructed the electricity TSO to reopen the October 2021 auction to select additional
projects from already submitted bids to ensure electricity adequacy in the 2025 delivery
year. It is expected that this will result in a new CRM contract with a gas-fired power plantof similar capacity (around 0.8 GW) that has all the needed permits in place.

Nuclear fuelBelgium has no mining, conversion, enrichment, reprocessing or fuel manufacturing
activities. In the past, Belgium operated two fuel manufacturing facilities in Dessel, whichceased operations in 2006 and 2015. The private company Synatom provides Electrabelwith the enriched uranium to manufacture new fuel assemblies for the Doel and Tihange
reactors. Synatom secures the supply of uranium through medium- and long-term
contracts with several uranium exporters and negotiates enrichment contracts with thecompanies Urenco (the Netherlands), Orano (France) and Tenex (Russian Federation).
Synatom holds strategic stocks of uranium to accommodate potential adjustments
depending on price fluctuations and technical constraints arising at the reactors.

Nuclear waste management

In 2016, a ministerial decree approved the first National Programme for the Managementof Spent Fuel and Radioactive Waste, which provides a strategic framework for the
management of Belgium’s radioactive waste and spent fuel that is in line with EU directives
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The National Agency for Radioactive Waste and Enriched Fissile Materials(NIRAS/ONDRAF) is entrusted by law with the safe transportation, treatment, conditioning,storage and disposal of all radioactive waste produced in Belgium. It works under thesupervision of the Minister of Energy and the Minister of the Economy. TheNIRAS/ONDRAF performs its activities through the industrial subsidiary Belgoprocess.

8. NUCLEAR(Kingdom of Belgium, 2011). In 2013, the NIRAS/ONDRAF applied to the Federal Agency
for Nuclear Control for a licence to build and operate a new disposal facility for low-level
nuclear waste in Dessel, Belgium. The permitting process is still ongoing. To addressconcerns of the local community, the two local partnerships (STORA and MONA, involving
the municipalities of Dessel, Mol and NIRAS/ONDRAF) are participating in the process for
issuing the environmental licence.
In 2020, the NIRAS/ONDRAF conducted a public consultation on a draft plan for long-term
management of high-level and long-lived waste, proposing a geological disposal system
in Belgium (ONDRAF, 2018). The government plans to adopt a national programme forthe long-term management of high-level and/or long-lived nuclear waste and spent fuelmanagement that meets EU obligations.

Decommissioning
According to federal regulations, the decommissioning of nuclear power plants, andfacilities handling nuclear fuel and radioactive waste, is subject to prior authorisation by
the Federal Agency for Nuclear Control, which develops specific regulatory processes toensure safe decommissioning and monitors each step of the process. Belgium gained
experience in decommissioning nuclear facilities as of 1987, with several projects alreadycompleted (e.g. the Thetis reactor, Eurochemic’s main building and the Belgonucléaire fuelmanufacturing facility), while others are still ongoing (e.g. the Franco-Belge de Fabricationde Combustible fuel manufacturing facility).

Funding system of decommissioning and waste management
In Belgium, all costs arising from the decommissioning and handling of radioactive waste
generated in nuclear reactors are fully borne by the nuclear operator, Electrabel, with nolimitation in time. Synatom is in charge of collecting Electrabel’s contributions and also of
the management of the associated funds to finance decommissioning and waste
management activities for Belgium’s reactors. Synatom’s funds are split into two different
compartments:•

Decommissioning Fund: to cover all the activities from final facility shutdown to
final site release, including costs for all waste categories except spent nuclear fuel.

•Spent Nuclear Fuel Fund: to finance all costs associated with spent nuclear fuelassemblies, from interim storage to final disposal, as well as its conditioning andreprocessing. ONDRAF will manage the final disposal of all radioactive waste via
payments from this fund.

Every three years, Synatom submits the basic characteristics and cost calculations ofdecommissioning and waste management to the Commission for Nuclear Provisions,which verifies the long-term adequacy and availability of the funding of these activities.

In 2020, nuclear RD&D accounted for a large share of the federal spending on RD&D
(around 41%). The main areas of nuclear RD&D include spent fuel management, waste
management, decommissioning, nuclear medicine and fusion. The federal government
places a priority on maintaining nuclear energy RD&D expertise, particularly in relation to
responsible management of radioactive waste and spent nuclear fuel to support the safe
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Nuclear energy RD&D

operation and decommissioning of nuclear power plants in Belgium and abroad. Belgium’s
NECP reaffirms federal support for RD&D on nuclear fission and fusion.
Belgium is making a major investment in nuclear RD&D through the (Multi-purpose hYbrid
Research Reactor for High-tech Applications) MYRRHA research facility. MYRRHA is theworld’s first large-scale accelerator-driven system that consists of a subcritical nuclear
reactor driven by a high-power linear accelerator. MYRRHA will support a range of nuclear
RD&D, including work related to the long-term management of high-level radioactive waste
such as partitioning, transmutation, accelerator technology and fusion. In 2018, the federal
government decided to have MYRRHA built at the SCK CEN site in Mol, Belgium. The
total budget for MYRRHA is estimated at EUR 1.6 billion, of which the federal government
has already committed to fund EUR 558 million. The rest will have to be funded by otherEU countries and international partners. The project is planned in three phases to becompleted between 2026 and 2036 (World Nuclear News, 2018).
Belgium seeks to maintain expertise in nuclear RD&D and in 2022, commited
EUR 100 million over four years for research supporting the development of small modular
nuclear reactors.

ENERGY SECURITY

8. NUCLEAR

Assessment
Belgium’s nuclear reactors have historically provided over half of Belgium’s electricity
generation. In 2019, the Belgian nuclear fleet generated 46 TWh and 47% of the total
electricity generation. Current nuclear energy policy is focused on phasing out mostnuclear electricity generation in a secure manner by 2025. In light of the Russian invasionof Ukraine and goals to reduce fossil fuel dependency, the federal government decided in
March 2022 to take the necessary steps to extend 2 GW of nuclear capacity (Tihange 3
and Doel 4) by ten years.Phasing out most nuclear electricity generation will have a large
impact on the Belgian electricity system, including higher GHG emissions and potential
challenges to maintaining security of electricity supply.

Belgium has developed a CRM that aims to ensure security of electricity supply during andbeyond the nuclear phase-out. The October 2021 CRM auction awarded payments to
4.4 GW of capacity, mainly to natural gas generation. The regional environmental permitof one of the proposed new gas plants was refused in November 2021. In March 2022, thefederal government cancelled the CRM contract for this plant and instructed the electricity
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Achieving a timely extension of 2 GW of nuclear capacity will be challenging, given theregulatory and technical constraints associated with lifetime extensions of nuclear
reactors. The government has indicated that the extension cannot be completed by thewinter of 2025, but hopes to have the 2 GW operational in 2026. The experience from thelifetime extensions of Belgium’s Tihange 1 and Doel 1 and 2 reactors shows that at least
four to five years are necessary for reactors undergoing lifetime extensions to be fully
operational. The Federal Agency for Nuclear Control in open to postponing non-essential
upgrades to secure a realistic schedule. In addition, legal challenges (e.g. the need of a
new environmental impact assessment for licence extensions), potential delay inregulatory processes, project risks and/or other unforeseen events could delay thecompletion of the lifetime extension. Unless swift action is taken, it is unlikely thatnecessary investments and regulatory procedures will be completed in time to allow
Tihange 3 and Doel 4 to continue operations beyond 2025.

8. NUCLEAR

TSO to reopen the October 2021 auction to select additional projects from alreadysubmitted bids to ensure electricity adequacy in the 2025 delivery year. It is expected that
this will result in a new CRM contract with a gas-fired power plant of similar capacity(around 0.8 GW) that has all the needed permits in place.
Nuclear power is the main low-carbon source of electricity generation in Belgium,
representing 70% of the low-carbon electricity generation. It is likely that pahing out mostnuclear generaiton will result in increased gas-fired generation and higher CO2 emissions.
To limit this increase in emissions, the deployment of clean technologies such as wind,solar PV and decarbonised gases, as well as electricity system flexibility and energy
efficiency measures, should be intensified. At the same time, nuclear lifetime extensions
are an affordable low-carbon option (IEA, 2020). Electrabel invested USD 1.4 billion in the
refurbishment of Tihange 1 and the Doel 1 and 2 units (USD 750 per kilowatt electrical
capacity, kWe) for a 10-year extension of operations (Engie-Electrabel).
In the latest five-year inventory report published in 2018, NIRAS/ONDRAF concluded that
additional funding is needed to ensure the safe and secure decommissioning of Belgium’s
reactors and management of spent fuel. Taking into account these inputs and the revised
scenario for the decommissioning of the Belgian nuclear fleet, the Commission for Nuclear
Provisions estimated an increase of EUR 2.1 billion in necessary funding (EUR 6 billion
for the Decommissioning Fund and EUR 7.8 billion for the Spent Nuclear Fuel Fund).
These outcomes show that the governance system in place effectively identifies potential
cost increases and enables the implementation of necessary corrective measures.
Until 2020, up to 75% of the Spent Nuclear Fuel Fund could be lent back to Electrabel(upon credit rating and solvency requirements). This practice ended in 2020 and Electrabel
is committed to reimburse the loans related to the provisions for the spent fuelmanagement by 2025 (EUR 4.7 billion). This will considerably improve the reliability andavailability of funding by decreasing the fund’s degree of risk exposure with a significant
margin.

Electrabel is responsible for the decommissioning of Belgium’s entire nuclear fleet. An
immediate dismantling strategy has been considered, with first licensing and preparatory
works underway. Since 1987, Belgium has acquired valuable experience in thedecommissioning of fuel reprocessing facilities and experimental reactors. Nevertheless,
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As a result, Synatom will become one of the largest fund managers in Belgium by 2025,with capital surpassing EUR 10 billion (Synatom, 2021). A new investment policy andgovernance framework will be required, since capital management will play a more
dominant role in Synatom. Electrabel has already announced that the governancestructure of Synatom will be overhauled to increase its capability, with the upcoming hiringof two external fund administrators with financial expertise (NEA, 2021). In parallel, thefederal government is examining the possibility of using Synatom funds (without taking
over responsibility) to support the energy transition, while taking measures to ensure theavailability and adequacy of these funds in the future. Such government intervention, if notproperly managed, could impact on the future availability of funds and therefore thedecommissioning and waste management activities. It increases the risk exposure of
Electrabel and eventually Belgian taxpayers. The federal government already holds a
golden share in Synatom, giving it the right to veto any decision against the country's
energy policy interest and the adequate management of the decommissioning and waste
management funds.

these activities have been carried out by other organisations such as SCK CEN and
Belgoprocess, with limited involvement of Electrabel. Decommissioning of nuclear powerreactors will be a first-of-kind project in Belgium and for Electrabel. The various actors
responsible for decommissioning should take a programmatic approach that capitalises on
lessons learnt to progressively reduce the cost for decommissioning Belgium’s reactors as
the nuclear phase-out proceeds. In addition, the decommissioning of the nuclear fleet isan opportunity for Belgium to develop valuable industrial know-how that could be used forthe decommissioning of other reactors around the world.
Timely availability of storage facilities for nuclear waste and spent fuel is essential for the
successful decommissioning of the Belgian nuclear fleet. Expansion of the waste storage
facilities to accommodate higher volumes of low- and mid-level waste was approvedin 2018. This expansion should be completed by 2022. The construction of additional
waste storage facilities at the sites of Doel and Tihange for dry interim storage of the spent
fuel should be completed by 2023 (Tihange) and 2025 (Doel). These timelines are
consistent with the nuclear phase-out plans and should not inhibit the immediate
dismantling of the plants.

ENERGY SECURITY

8. NUCLEAR

In 2020, ONDRAF conducted a public consultation on its draft national policy for the
long-term management of high-level waste, proposing a geological disposal system on
Belgian territory. The government has indicated that it plans to adopt a national policy forthe long-term management of nuclear waste. Given that the decommissioning of thereactors will begin shortly after the first closures in 2022, the government should accelerate
its efforts to establish a permanent site for long-term storage of nuclear waste and spent
fuel from Belgium’s reactors.

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A large share of federal spending on energy RD&D is directed to nuclear energy. In thelight of the nuclear phase-out, the federal government should maintain (or even increase)nuclear energy RD&D efforts to sustain workforce capabilities in Belgium, mainly
leveraging the MYRRHA nuclear research facility. The nuclear phase-out could result in a
net loss of know-how which, if not properly managed with long-term policies, could havedetrimental consequences for Belgium’s ability to perform nuclear activities in the future.
In 2022, Belgium announced EUR 100 million in funding for research on small modular
reactors.

8. NUCLEAR

Recommendations
The government of Belgium should: Take quick action to ensure that the extension of 2 GW of nuclear capacity by ten
years can be completed in a timely and cost-effective manner.
 Ensure that envisaged reforms of the management and investment policy of thedecommissioning and waste management funds do not hamper the timely availabilityof these funds.
 Finalise the national long-term strategies for high-level waste management. Next steps
include the definition of key milestones and identification of a disposal site, withassociated preliminary studies, while ensuring timely involvement of relevant
stakeholders and local communities.

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 Develop a national nuclear sector plan that provides long-term visibility on remaining
nuclear activities and fosters collaboration among national and internationalorganisations in key areas (especially decommissioning and long-term managementof high-level radioactive waste) and ensures the continued availability of a skilledworkforce.

References
IEA (International Energy Agency) (2022), World Energy Balances (database),https://www.iea.org/data-and-statistics/data-product/world-energy-balances (accessed on
18 February 2022).
IEA (2020), Projected Costs of Generating Electricity 2020,
https://www.iea.org/reports/projected-costs-of-generating-electricity-2020.
Kingdom of Belgium (2011), National Programme for the Management of Spent Fuel andRadioactive Waste, https://economie.fgov.be/sites/default/files/Files/Energy/Nationalprogramme-courtesy-translation.pdf.
Montel News (2021), Engie writes down Belgian assets by EUR 2.9 billion,
https://www.montelnews.com/news/1198985/engie-writes-down-belgian-assets-by-eur29bn.
NEA (Nuclear Energy Agency) (2021), Ensuring the Adequacy of Funding for
Decommissioning and Radioactive Waste Management, OECD, Paris, https://www.oecdnea.org/jcms/pl_59705/ensuring-the-adequacy-of-funding-for-decommissioning-andradioactive-waste-management?details=true.

ENERGY SECURITY

8. NUCLEAR

ONDRAF (2018), Avant-projet d’arrêté royal établissant le processus d’adoption de lapolitique nationale relative à la gestion à long terme des déchets radioactifs conditionnésde haute activité et/ou de longue durée de vie et définissant la solution de gestion à longterme de ces déchets [Preliminary draft royal decree establishing the process for adopting
the national policy relating to the long-term management of conditioned high-level and/or
long-lived radioactive waste and defining the solution for the long-term management of thiswaste], https://www.ondraf.be/sites/default/files/2020-04/Projet%20de%20Plan_FR_def.pdf.
Synatom (2021), Annual Report 2020, https://synatom.be/uploads/files/rapports/rapportactivite-2020-EN.pdf.

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World Nuclear News (2018), Belgian government approves funding for MYRRHA,
https://world-nuclear-news.org/Articles/Belgian-government-approves-funding-for-Myrrha.

Key data (2020)
Domestic production: 6 mcm
Net imports: 18.2 bcm (21.7 bcm imports, 3.4 bcm exports), +4% since 2009
Share of gas: 0% of domestic energy production, 28% of TES, 27% of electricity generation,
26% of TFC

ENERGY SECURITY

9. Natural gas

Gas consumption by sector: 18.5 bcm (industry 40%, power generation 26%,
residential 22%, commercial 12%, other energy 6%), +1% since 2009

Overview
From 2010 to 2020, the shares of natural gas in TES and TFC increased overall, but withnotable annual variations driven by changes in heating demand, industrial gas demandand gas-fired electricity generation (Figure 9.1).

Share of gas

Figure 9.1 Share of natural gas in the energy system in Belgium, 2000-2020
35%
33%

Electricity
generation

31%
29%
27%

Total energy
supply

25%
23%
21%
19%

Total final
consumption

17%
15%
2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020 IEA. All rights reserved.

The share of natural gas in electricity generation experienced large fluctuations, driven by
nuclear reactor shutdowns, the growing share of renewables and electricity imports.

The share of gas in TES ranged from 24% to 30%, while the share of gas in TFC ranged
from 23% to 27%. The share of gas in electricity generation experienced larger
fluctuations, from 25% to 33%, driven mainly by temporary shutdowns of Belgium’s nuclear
reactors as well as market competition with growing renewable generation and electricity
imports.
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Source: IEA (2021a), World Energy Statistics and Balances (database), https://iea.org/statistics.

9. NATURAL GASStructural changes in the gas market in Belgium and its neighbouring countries forced
adjustments of Belgium’s natural gas policy, notably to convert the L-gas network tohigh-calorific natural gas (H-gas). This change is needed as a result of the upcoming endof gas supplies from the Groningen gas field in the Netherlands. Another challenge for thefederal and regional governments is to address decarbonisation of the gas sector and theintroduction of low-carbon gases.

Supply and demand
Almost all of Belgium’s gas supply is imported and it has only a very small gas production(just 6 million cubic metres [mcm] in 2020, compared to 18.5 billion cubic metres [bcm] of
demand). Most of Belgium’s natural gas imports are used to cover domestic gas demand,
but a notable share of gas imports transits though Belgium’s gas network to other countries(Figure 9.2). Gas trade is supported via cross-border pipelines with France, Germany and
the Netherlands; subsea pipelines with Norway and the United Kingdom; and Belgium’s
only LNG terminal located in Zeebrugge. From 2010 to 2020, the majority of Belgium’s
natural gas supply (70-94%) was imported via pipeline (mainly from the Netherlands andNorway), with the remainder imported via the LNG terminal (mainly from Qatar). In 2020,
Belgium’s net gas imports where 18.2 bcm (21.7 bcm imports and 3.4 bcm exports).

Net exports

Net imports

Figure 9.2 Belgium’s natural gas net trade by country, 2000-2020
GermanyTWh
20
15

RussianFederation
Qatar

10

NorwayFrance5Netherlands
0

Other

-5

Total net trade
IEA. All rights reserved.

The Netherlands and Norway are Belgium’s main sources of gas imports. The Groningenphase-out reduced imports from the Netherlands in 2019, leading to higher LNG imports.

A significant share of Belgium’s gas imports is covered by L-gas produced from theGroningen gas field in the Netherlands, which will stop production in mid-2022, although
under current plans, parts of the field will be kept open as a backup gas source with fullclosure likely between mid-2025 and mid-2028 (Platts, 2021). L-gas is delivered toconsumers (primarily households) through a dedicated L-gas network that extends fromthe Netherlands through Belgium and parts of northern France and Germany. The supplyof L-gas will be maintained at a reduced level after the closure of Groningen via stationsin the Netherlands that convert H-gas to L-gas. Belgium is adapting its L-gas infrastructure
to support H-gas and expects to complete this process by 2024. As a result of theGroningen phase-out, the share of Belgium’s gas imports from the Netherlands fell notably
from 44% in 2018 to 29% in 2019 and 30% in 2020, and is expected to continue to decline.
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Source: IEA (2021a), World Energy Statistics and Balances (database), https://iea.org/statistics.

The reduction of imports from the Netherlands in 2019 resulted in a notable increase in
LNG imports from Qatar and the Russian Federation.
Belgium’s gas demand peaked in 2010 at 20.6 bcm, mainly because of exceptionally cold
weather that increased demand for gas heating in residential buildings. After 2010, gas
demand returned to historically normal levels and experienced a slight increase until 2014,
when there was a major drop in demand for gas heating and gas-fired electricity
generation. Since then, gas demand has steadily increased again, reaching 18.4 bcm
in 2020 (Figure 9.3). Industry is the largest natural gas consuming sector (41% of gas
demand in 2020), followed by electricity and heat generation (27%), residential buildings(20%), and service sector buildings (12%). There is a small demand for natural gas intransport (0.1 bcm in 2020).
Figure 9.3 Natural gas demand by sector in Belgium, 2000-2020

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9. NATURAL GAS

bcm
20

Electricity andheat generation

15

Residentialbuildings

10Servicesbuildings
Industry

5

Transport

0

IEA. All rights reserved.

Belgium’s natural gas demand has increased steadily since 2014, after an annual drop in
demand for gas heating and gas-fired electricity generation in 2014.
Source: IEA (2021a), World Energy Statistics and Balances (database), https://iea.org/statistics.

Gas policy
Belgium’s energy policy supports the efficient use of natural gas. In line with the target to
reduce Belgium’s GHG emissions by at least 35% by 2030 versus 2005 levels, Belgium is
working to reduce natural gas demand, especially in the residential sector, where natural
gas is the main source of heating. There is also support for reducing gas demand inindustry through various energy efficiency programmes.

The phase-out of most nuclear generation and the CRM will likely lead to increased gasfired electricity generation and higher gas demand. Belgium will have to anticipate how
increased gas demand will impact energy security and costs, and the achievement of
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The federal government is committed to phasing out most nuclear electricity generation by2025 (see Chapter 8). To ensure security of electricity supply as nuclear generation is
reduced, Belgium created a CRM to support the deployment of new capacity andretention/upgrading of existing capacity. The first CRM auction was conducted in October
2021 and awarded payments to 4.4 GW of capacity, mainly to natural gas (2.0 GW forexisting gas plants and 1.6 GW for two gas new plants) (see Chapter 7).

9. NATURAL GAS

Belgium’s GHG emissions reductions targets. In the longer term, Belgium aims tosignificantly reduce natural gas demand in line with energy transition and climate neutrality
goals. According to the federal government, natural gas will only play a marginal role in
the gas mix for electricity production in Belgium towards 2050; however, Belgium does nothave a clear strategy on how to decarbonise the gas sector.
The regional governments are taking notable steps to reduce gas demand. Flanders aims
to increase the rate of replacing and optimising existing natural gas boilers in residentialbuildings and has set an obligation that gas heating appliances must be serviced every
two years by a qualified engineer. Flanders has also taken measures to discourage further
expansion of its natural gas distribution network. A decree of 10 March 2017 removed thetarget requiring gas DSOs to reach a degree of gas connection of 95-99% by 2020. A
decree of 10 October 2020 states that gas DSOs will only provide a gas connection to newlarge housing projects to support district heating with co-generation, or when renewableenergy is the main heating source. Flanders is preparing strategies to decarbonise its gas
supply, with a road map for industry released in 2020 (Deloitte, 2022).
There are no legal restrictions on gas connections in Wallonia, but a gas DSO may refuse
a connection request if it is uneconomic for the DSO. Wallonia has announced that it will
evaluate support for renewable gases to support a phased decarbonisation of the gas
sector. The Brussels-Capital Region plans to gradually phase out natural gas startingin 2030, and is considering a ban on new cooking and heating appliances using naturalgas, butane and propane starting in 2030.
Belgium’s energy policy also sees a role for low-carbon hydrogen in decarbonising the gas
supply. In November 2021, the Council of Ministers approved the federal Hydrogen
Strategy, which lays out the federal government’s vision for low-carbon hydrogen in
Belgium’s economy and energy sector through 2050 (see Chapter 2). The focus is mainly
on becoming on import and trading hub, and on using hydrogen to decarbonise industry
and heavy transport (and potentially other sectors in the long term). The strategy contains
specific targets for expanding hydrogen transport infrastructure, including commissioning
a minimum of 100-160 km of new hydrogen pipelines by 2026, partly supported by
EUR 95 million from Belgium’s EU-funded National Recovery and Resilience Plan. Thereis also a 2030 target for hydrogen interconnections with all its neighbouring countries. The
strategy emphasises the opportunity to repurpose natural gas infrastructure, especiallyinfrastructure that will no longer be used after the conversion from L-gas to H-gas.

The Heat Plan approved by the Flemish government in 2017 encourages support forbiomethane, with an annual budget of EUR 10.5 million. In Wallonia, significant progress
for the Biomethane Strategy was realised during 2020, as three biomethane production
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The regional governments have introduced strategies and support schemes for the
production of biomethane and hydrogen and are supporting several EU projects ofcommon interest on hydrogen. Flanders has a detailed regional Hydrogen Strategy
covering production and demand. It includes targets for large- and small-scale electrolysis
with combined capacity of at least 221 MW by 2025 and 560 MW by 2030. It also targets
decarbonising current natural gas hydrogen production and greatly expanding hydrogen
import and transport infrastructure. It provides 2025 and 2030 goals for increased use ofhydrogen in industry, transport and buildings. In October 2021, Flanders and the European
Investment Bank signed a memorandum of understanding to collaborate on financing andimplementing hydrogen projects in Flanders.

(and injection) facilities have applied for certification to be eligible for guarantees of origin.
The first injections of biomethane started successfully in October 2020. Wallonia is also
considering establishing a support mechanism to encourage the construction ofhydrogen-related infrastructure, and the taxation of hydrogen vehicles will be reviewed tofine-tune the Walloon objectives in terms of developing alternative fuels.

L-gas to H-gas conversion
Belgium’s energy policy places a strong focus on maintaining security of supply. In
particular, Belgium is ensuring that the phase-out of production from the Groningen gas
field does not impact gas supply. Belgium is co-operating with France, Germany and theNetherlands through the Pentalateral Gas Platform, which allows the Netherlands toprovide timely and detailed information on the reduction in L-gas supply and supports
collaborative efforts to reduce L-gas demand by switching supply and gas infrastructure to
H-gas and by lowering overall gas demand.

ENERGY SECURITY

9. NATURAL GASIn Belgium, the planning and implementation of the L-gas to H-gas conversion is
co-ordinated by the Federation of Electricity and Gas Network Operators (Synergrid) under
the supervision of the DGE. Synergrid has developed a plan to complete the conversionof all L-gas infrastructure to H-gas, which is based on repurposing as much of the existing
Belgian infrastructure as possible with a view to reducing costs and the time needed(Fluxys, 2021a). The plan identifies regional L-gas clusters to be converted in phases andincludes detailed estimates of the number of connections and corresponding gas demandthat will be transferred to H-gas. Evaluations carried out by Fluxys Belgium indicate thatthe existing H-gas entry capacity is sufficient to absorb the L-gas market into the H-gas
transport network. The required adaptations of the network to enable the conversion havebeen identified and integrated into the Conversion Plan.

Progress on conversion is reported to the L-Gas Market Conversion Monitoring Task
Force, established in 2019 to monitor and co-ordinate the conversion projects in Belgium,
France, Germany and the Netherlands. The task force supervises the production of areport compiled twice a year assessing the adequacy of L-gas supply from theNetherlands. The report is produced by the IEA, the European Network of Transmission
System Operators for Gas, Gasunie Transport Services (GTS, the gas TSO of theNetherlands), and the Dutch Ministry of Economic Affairs and Climate Policy. The third
edition of the report was published in February 2021 and covers market developments
through the gas year 2019/20; provides an update on the progress of the conversion
programmes, with a special focus on the impact of the Covid-19 induced lockdowns
in 2020; and details planned conversion activities through the gas year 2021/22 (IEA et al.,2021).

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The Conversion Plan is updated annually to account for optimisation opportunities and isformally approved for a period of two years to enable timely communication to all
stakeholders. Synergrid handles communication with gas suppliers. The TSO and DSOs
handle communication with their end users, who must receive a letter at least two years
before the actual conversion. Consumers are responsible for having the compatibility of
their gas appliance checked by a professional. The Belgian natural gas association(Gas.be) informs and provides training to gas appliance installers and professionals and a
website (www.gaschanges.be/en) has been established to provide detailed information on
the Conversion Plan.

9. NATURAL GAS

Due to a faster than expected progress on infrastructure conversion, Belgium now aims
for the full conversion of its gas supplies and infrastructure to H-gas by 2024. This requires
converting more than 1.6 million connections. As of 2020, around 130 000 connections
had been converted.

Social tariff
To address energy poverty and ensure energy access, Belgium has a social tariff thatlowers the gas and electricity bills of residential consumers that meet certain
socio-economic requirements. The cost of the social tariff is coved by a fee charged to allenergy consumers in Belgium (see Chapter 2). From 2017 to 2019, there was a steadyincrease in the number of gas consumers receiving the social tariff (Table 9.1). In 2020,
eligibility for the social tariff was expanded in response to the Covid-19 pandemic, resulting
in a large increase in the number of gas consumers receiving it (CREG, 2021).
Table 9.1 Natural gas social tariff consumers covered and cost reduction in Belgium,
2017-2020Year

Natural gas social tariff
Consumers covered

Reduction versus averageretail tariff

NumberShare of consumers

2017

251 855

9.4%-40.7%

2018

260 4619.7%-48.2%

2019266 3469.9%-37.6%

2020

295 937

10.0%NAMarket structure
Belgium’s gas market has been liberalised and opened to competition since 2007. Thereis legal separation between commercial activities and network operations. Use of the gas
networks is open to any company wishing to supply gas to end users; consumers are free
to choose the supplier of their choice and prices are determined by market forces.

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Regulatory responsibilities over the Belgian gas market are divided between the federal
regulator, the CREG, and the three regional regulators: the VREG in Flanders, the CWaPE
in Wallonia and the Brugel in the Brussels-Capital Region. The regulatory authorities are
independent, both from market players and from policy makers. The CREG is responsible
for the natural gas transmission system, including approval of transmission tariffs, and also
advises the federal government on gas and electricity markets. The VREG, CWaPE and
Brugel approve distribution grid tariffs and regulate natural gas distribution and compliancewith regional public service obligations. They also advise each regional government on theoperation of gas and electricity markets. The regional regulators monitor retail market
competition in their respective regions, while the CREG monitors wholesale market
competition.

The private company Fluxys Belgium is the Belgian gas TSO. Fluxys Belgium also owns
and operates Belgium’s only large-scale gas storage facility at Loenhout. Fluxys LNG (a100% subsidiary of Fluxys Belgium) owns and operates the Zeebrugge LNG facility(Fluxys, 2021b). The private company Fluxys Holding owns 90% of the shares in Fluxys
Belgium, while the Belgian state holds a golden share, which is able to outvote all othershares in certain specified circumstances. The remaining shares are traded on theEuronext Brussels Stock Exchange.

Wholesale market
In 2015, Belgium and Luxembourg merged their wholesale gas markets into the single
BeLux market. BeLux is composed of the integrated H-gas market in Belgium andLuxembourg and the L-gas market in Belgium. Under BeLux, the Belgian and Luxembourg
gas networks form a single entry/exit zone, with Belgium’s ZTP hub as the virtual trading
point. In 2019, there were around 70 participants active on the ZTP hub and around
220 TWh of natural gas was traded, twice as much as in 2017 (110 TWh). In 2019, spot
products (day-ahead, intraday, etc.) made up 39% of traded volumes at the ZTP hub.
Medium-duration contracts (monthly, quarterly and seasonal) represented 55% andlong-duration products accounted for 6%. The churn rate of the ZTP hub was 1.9 in 2019,notably lower than the churn rate of up to 5 seen in recent years and indicating low liquidity(ACER and CEER, 2020). The interconnection between Belgium and Luxembourg is nolonger a commercial point (no interconnection tariffs are charged) and a new capacity
product manages flows on the Remich interconnection between Luxembourg andGermany and links the ZTP with the German NCG trading hub (Horslen, 2015).

ENERGY SECURITY

9. NATURAL GAS

To support the operation of the BeLux market, Belgium amended its gas law permitting
Fluxys to devolve its commercial balancing activity to an operator for the combined market
and extending the CREG’s jurisdiction to cover the new operator. In June 2020, the energy
regulators of Belgium (CREG) and Luxembourg (ILR) assigned the role of BeLux balancing
market operator to the private company Balansys, which is owned 50% by Fluxys Belgium
and 50% by Luxembourg’s gas TSO (Creos Luxembourg). Balansys’ main responsibility
is market-based balancing of the BeLux area, including aggregating the balancing
positions of the network users, purchasing and selling gas for balancing purposes, andinvoicing balancing charges to the network users (Balansys, 2021). The BeLux market isoverseen by both the CREG and ILR.

The HHI is an indicator for market competition. It ranges between 0 for an infinite number of small firms (maximum
competition) and 10 000 for one firm with 100% market share (no competition). An HHI above 2 000 signifies a highly
concentrated market with a small number of firms.
3

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In 2019, 26 companies were authorised to participate as suppliers in the BeLux wholesalegas market. BeLux is a dynamic and competitive wholesale gas market. Only two suppliers
have a market share above 9%: Engie-Electrabel (26.2%) and EDF Luminus (12.9%); 15
have market shares ranging from 8.8% (Eni) to 1%; while 8 suppliers have a market shareless than 1%. In 2019, the HHI 3 score for the BeLux market was 1 367 points, the thirdlowest in the EU after the United Kingdom (834 points) and France (1 221 points),
indicating a competitive market (ACER and CEER, 2020).

9. NATURAL GASRetail market
Flanders, Wallonia and the Brussels-Capital Region each have separate retail gas markets
overseen by their respective energy regulators, with different tariff structures and market
rules. Belgium’s retail gas markets are less competitive compared to the BeLux wholesalemarket. In 2019, the household and industry segments of Belgium’s combined retail gas
markets both had HHI scores close to 2 000 points (the seventh-lowest score forhouseholds and the tenth-lowest for industry in the EU), indicating a moderate level ofmarket concentration (ACER and CEER, 2020). The HHI scores of Belgium’s gas retailmarkets show significant regional differences: 1 945 in Flanders, 2 377 in Wallonia and4 433 in the Brussels-Capital Region.
In 2019, 42 retail gas suppliers were active in Belgium, with the largest suppliers having
dominant market shares in all three regional markets (CREG, 2020). In Flanders, the top
four retail gas suppliers accounted for 69.6% of gas supplied in 2019: Electrabel (37.9%),
Luminus (13.7%), Eneco Belgium (10.6%) and Lampiris (7.4%). These companies also
dominate the retail gas supply in Wallonia, accounting for 75.2% in 2019: Electrabel(35.1%), Luminus (18.4%), Lampiris (15.3%) and Eneco Belgium (6.4%). In theBrussels-Capital Region, the market is even more concentrated, with Electrabel
accounting for 54.3% of the gas supply in 2019, followed by Lampiris (17.1%) and Luminus(10.2%).
The annual switching rate of gas retail customers in 2019 was 17%, up from 13% in 2018.
However, the rate has been variable over the past decade, fluctuating between 12% and19%. The switching rate in Flanders in 2019 was 28.5% (one of the highest rates in
Europe), while the rate in Wallonia was only 5.6%. In the Brussels-Capital Region, the rate
was 7.3% for households and 12.3% for SMEs in 2019.

Retail prices and taxation
Retail natural gas prices in Belgium are composed of wholesale gas costs, network tariffs,
federal taxes and VAT. In 2019, the average retail gas price for household consumers(excluding VAT) consisted mostly of wholesale gas costs (60.5%), followed by distribution
tariffs (32.5%), transmissions tariffs (3.5%) and federal taxes (3.5%). In 2020, Belgium’s
natural gas industry price was the fifth-lowest among IEA member countries(22.6 USD/MWh, with a low tax rate of 6%), while the household gas price was thetenth-lowest among IEA member countries (57.4 USD/MWh, with a 21% tax rate)(Figure 9.4).

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From 2009 to 2019, Belgium’s industry and household natural gas prices followed trends
similar to those of its neighbouring countries (Figure 9.5). The industry price for gas in
Belgium fell sharply from 2013 to 2016, spiked in 2018, and in 2019 was close to prices
seen in Luxembourg, the Netherlands and the United Kingdom. Household gas prices in
Belgium followed a similar trend to industry prices and in 2019 were below the median
price among Belgium’s neighbouring countries.

Figure 9.4 Industrial and household gas prices in IEA member countries, 2020

USD/MWh

Industry
Tax component

70
60
50
40
30
20
10
0

IEA. All rights reserved.

USD/MWhHouseholds
140
120
100
80
60
40
20
0

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9. NATURAL GAS

Tax component

IEA. All rights reserved.

Note: 2020 prices are not available for Australia, Finland, Greece, Japan or Mexico.
Source: IEA (2021b), Energy Prices and Taxes 2020 (database), https://www.iea.org/data-and-statistics.

Figure 9.5 Industrial and household gas prices in selected IEA member countries,
2009-2019
Industry Household
USD/MWh

105

50

USD/MWh

95

45

85

40

75

35
30

65

25

55

20
2009

2011

Netherlands

2013

2015
France201745
2019 2009

Germany

2011

United Kingdom

2013

2015
Luxembourg2017

Belgium

IEA. All rights reserved.

Belgium’s industry and household prices both followed similar price trends as its
neighbouring countries and were below the median price of those countries in 2019.
Note: Price data from Belgium are not available from 2000 to 2008.
Source: IEA (2021b), Energy Prices and Taxes 2020 (database), https://www.iea.org/data-and-statistics.

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55

9. NATURAL GASInfrastructure
Belgium has a well-developed and highly interconnected natural gas network that supplies
domestic gas demand and acts as a hub supporting flows between France, Germany,
Luxembourg, the Netherlands and the United Kingdom and to the broader European
market. Belgium has two gas transmission systems: one for receiving, transporting anddistributing L-gas, and another for H-gas. Belgium is in the process of converting its L-gas
network to support H-gas, which is expected to be completed by 2024.
The gas TSO’s indicative investment plan for 2020-29 aims for a total investment of
EUR 644 million in the gas transmission network, the Zeebrugge LNG terminal and the
Loenhout storage facility (Fluxys, 2021c). The main elements of the plan are conversionof the L-gas network to H-gas, infrastructure to support new gas-fired power stations
expected as a result of the nuclear phase-out, the increase in LNG regasification capacity
at the terminal in Zeebrugge, and adaptation and modernisation of the network.

Pipeline interconnection points
The Belgian transmission grid has a high level of interconnectivity with adjacenttransmission grids, offering extensive access to the Northwest European market and its
production facilities (Figure 9.6). Belgium has 17 cross-border pipeline interconnection
points, with 13 serving the H-gas network and 4 serving the L-gas network (Table 9.2).
The H-gas interconnections supply domestic H-gas demand and transit H-gas regionallyand to the broader European market. The Alveringem interconnection point is the mostrecent H-gas interconnection (commissioned in 2015) and connects Belgium’s H-gas
network to the LNG terminal in Dunkirk, France. The L-gas interconnections supply
domestic L-gas demand and transit L-gas to France.
Table 9.2 Belgium’s gas network’s capacity, February 2021
Network

Interconnection
pointsImportExport

13

144

108

H-gas

Maximum capacity (GWh/h)

L-gas

4

27

10

Total

17

171

118

Source: EC (2019), Preventive Action Plan Belgium,https://ec.europa.eu/energy/sites/ener/files/documents/20190808_preventive_action_plan_belgium_2019.pdf.

Belgium has one LNG terminal located in the Port of Zeebrugge, which supplies Belgium
and the European market with H-gas. It is operated by Fluxys LNG, which completed amajor expansion of the terminal in December 2019, adding a fifth storage tank with an
LNG storage capacity of 0.18 mcm. Following the expansion, the terminal’s LNG storage
capacity increased from 0.39 mcm to 0.57 mcm (around 347 mcm of natural gas). The
LNG infrastructure in Zeebrugge has an annual throughput capacity of 9 bcm. Activity at
the terminal reached a record high in 2019, with 90 LNG carriers unloading 11.3 mcm of
LNG (CREG, 2019). The LNG terminal can handle LNG carriers with LNG capacities from0.08 mcm to 0.27 mcm.

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LNG terminal

Figure 9.6 Gas infrastructure in Belgium

ENERGY SECURITY

9. NATURAL GAS

Fluxys LNG is considering increasing the Zeebrugge Terminal regasification capacity
through a further expansion. The Indicative Investment Plan of Fluxys Belgium and Fluxys
LNG 2021-2030 indicates construction of new regasification capacity to increase thestand-alone send out capacity to 8.2 gigawatt hours per hour (GWh/h) and then up to
10.5 GWh/h. The final investment decision for the increased stand-alone send out capacity
was taken by Fluxys LNG in February 2021; the commissioning of the first step is expected
early 2024 and the commissioning of the second step early 2026 (LNG Industry, 2021).

Transmission network
Belgium has two natural gas transmission networks, one for H-gas and another for L-gas,
which are physically separate and operated independently from each other by the gas
TSO (Fluxys Belgium). Belgium’s combined H-gas and L-gas transmission networks arecomposed of 4 000 km of high-pressure gas pipelines that supply gas directly to over
230 large industrial end users and power stations and over 70 receiving stations that
supply Belgium’s gas distributions networks (Fluxys, 2021d). The network has three main
high-pressure pipelines for the transportation of gas within Belgium and to neighbouring
countries. The VTN-RTR H-gas pipeline is bi-directional and runs from the interconnection
with the United Kingdom and the Zeebrugge LNG terminal to interconnections withGermany and the Netherlands. The Segeo H-gas pipeline runs from the Netherlands toFrance. The Poppel-Blaregnies pipeline supplies L-gas from the Netherlands to Belgium
and France (EC, 2019).

Belgium’s distribution network is composed of separate distribution networks for L-gas andH-gas with medium- and low-pressure pipelines and serves the majority of gas consumers
in the residential, commercial, and small and medium-sized industrial sectors. In 2020,
Belgium’s gas distribution system had around 2.7 million connection points. Belgium’s
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Distribution network9. NATURAL GAS

municipalities have a legal monopoly on gas and electricity distribution and own the gas
and electricity distribution networks. Nearly all municipalities have transferred
responsibility for the operation of the gas and electricity distribution networks tointer-municipal companies, which are the DSOs for the assigned section of the gas
distribution network. In 2019, there were 17 DSOs in Belgium: 11 in Flanders; 5 in
Wallonia, with ORES and RESA serving most of the region; and 1 in the Brussels-Capital
Region (Sibelga).

Storage
Belgium has one underground natural gas storage facility connected with the H-gas
transmissions system in Loenhout. The facility is operated by Fluxys Belgium and can beused by any gas supplier. It has a maximum storage capacity of 680 mcm, a maximum
injection capacity of 7.8 mcm per day and a maximum withdrawal capacity of 15.0 mcm
per day. The facility is used for seasonal gas storage and is highly flexible. Consideringthat annual gas consumption was 18.5 bcm in 2019, the gas storage facility can cover theequivalent of around 13 days of Belgium’s average gas demand. Short-term gas storageis also available at the Zeebrugge LNG terminal, which has a capacity of around 347 mcm
of natural gas.
The Loenhout storage facility gives suppliers a flexible source of natural gas and allows
them to ensure the continuity of deliveries to end users. Belgium does not have any
storage for L-gas, other than line-pack. Currently, Belgium uses the Dutch L-gas fields asswing supplier to provide flexibility in L-gas supply.

Gas emergency response policy
Belgium maintains a high degree of natural gas supply security through a combination ofseveral measures, including underground commercial gas storage and well-establishedsafety standards of the supply infrastructure by the TSO and DSOs. Belgium’s natural gas
emergency response policies are in line with EU Regulation 2017/1938 concerning
measures to safeguard the security of gas supply (“the SoS Regulation”).

The DGE is the competent authority for the security of gas supply and co-ordinates
emergency planning and communication with government agencies and supranational
institutions. The TSO has the responsibility to manage the response to a national gas
emergency and is the first one to give practical instructions to the shippers and suppliers
to adjust the gas flows as foreseen in the specific emergency plan.

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The DGE establishes regional and national risk assessments. Moreover, based on those
assessments, the DGE also needs to prepare a National Preventive Action Plan and an
Emergency Plan as parts of the emergency planning at national, regional and EU level, inconcertation with the CREG and the TSO (Fluxys Belgium). These assessments and plans
are revised every four years unless the circumstances warrant a more frequent update.
Also, the Law of 12 April 1965 on the transport of gaseous and other products by pipelines(“Gas Act”) designates the DGE as the competent authority to ensure the implementationof the measures provided for in the SoS Regulation. In the event of (a threat of) a crisis on
the gas market, the Gas Act authorises the implementation of necessary safeguard
measures.

Gas emergency response measures
Gas security in Belgium is supported by a variety of emergency response measures,
including both supply-side and demand-side measures. The Emergency Plan defines
three levels of gas crisis (Table 9.3). The DGE or Fluxys is responsible for declaring an
emergency as well as the crises level. During an emergency, top priority is given to
supplying gas to the protected consumers, mainly residential consumers and otherconsumers providing critical services. Protected consumers made up 62% of peak gas
consumption in 2019.
At the early-warning level, there will likely not be any immediate intervention by thecompetent authority. The event can and should be managed by market-based measuresalone. Network users are required to take measures to help balance the grid, such asincrease imports and/or reduce exports, temporarily suspend storage injections, and calls
on interruptible supply contracts. All measures and procedures available at theearly-warning level are still applicable at the alert level. In addition, in case of an alert level,
the TSO may request network users to voluntarily alter their nominations as far as possible
in order to safeguard the security of gas supply to protected customers in particular.

ENERGY SECURITY

9. NATURAL GAS

Table 9.3 The crisis levels of the gas supply in Belgium
Early-warning level

where there is concrete, serious and reliable information that an event which islikely to result in significant deterioration of the gas supply situation may occur
and is likely to lead to the alert or the emergency level being triggered

Alert level

where a disruption of gas supply or exceptionally high gas demand results insignificant deterioration of the gas supply; the market is still able to manage thedisruption or demand without the need to resort to non-market based
measures

Emergency level

where there is exceptionally high gas demand, significant disruption or
deterioration of gas supply and all relevant market-based measures have been
implemented but the gas supply is insufficient to meet the remaining gas
demand; non-market based measures have to be introduced with a view, inparticular, to safeguarding gas supplies to protected customers

Source: EC (2020), Emergency Plan Belgium,https://ec.europa.eu/energy/sites/ener/files/documents/23062020_emergency_plan_gas_belgium_2020.pdf•

Call to reduce natural gas consumption: the competent authority can issue a call to
end users to voluntarily consume less gas.

•

Constraint on firm capacity or curtailment of non-protected customers (administrative
and/or technical disconnection): the TSO can request that non-protected end users(industrial end users and gas-fired power plants) reduce or stop their consumption.

•

Enforced withdrawal of gas in storage: to safeguard the gas supply to protectedcustomers, the TSO has the right to use gas stored in Belgium. There are no
requirements for Belgian gas companies to keep emergency gas reserves. Companies
with contracts for gas storage in Belgium are obliged to fill at least 90% of contracted
storage volumes by 1 November each year, and to maintain a level of gas storage
above 30% of their contracted volume until 15 February.

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The emergency level will be activated by the TSO when the market-based measures alone
are no longer sufficient to guarantee contracted gas supplies to all end consumers. A
number of measures can be applied:9. NATURAL GAS

Network resilience
As mentioned above, Belgium has two separate gas networks: one for H-gas and one for
L-gas. This division of two networks is an important factor when considering secured gas
supply and network resilience of Belgium. The N-1 indicator 4 is applied by distinguishing
between H-gas and L-gas networks in Belgium. For H-gas, the Belgian network holds
multiple entry points and is fully capable of meeting an exceptional peak demand, even if
the most important injection point (the interconnector Zeebrugge Terminal) is out ofservice, with the N-1 factor at 273% in 2018.
For the L-gas network, there is only one entry point on Belgian territory, just as there is
only one supplier country, the Netherlands, with the N-1 factor at 18% in 2018. However,
the interconnection point supplying the Belgian network with L-gas is, in fact, made up of
two underground pipelines. According to the latest Preventive Action Plan, the probabilityof both pipes being simultaneously taken out of service is fairly limited, even in the eventof a major accident with a rupture of one of the two pipes and an explosion. Applied toeach of the pipes individually and given that both pipes have the same transport capacity,
the N-1 indicator leads to ratios of 81% for 2018 (CREG, 2020).

Assessment
Without domestic natural gas production, Belgium imports natural gas via cross-border
pipelines, subsea pipelines and Belgium’s only LNG terminal located in Zeebrugge.
Natural gas net imports reached 18.8 bcm in 2019, mainly from the Netherlands andNorway. L-gas produced in the Netherlands accounted for 22% of Belgium’s gas supply
in 2020.
Belgian gas demand reached 18.5 bcm in 2019, led by the demand from industry, which
accounted for 40% of total gas demand in 2019, followed by electricity and heatgeneration, residential buildings, and service sector buildings. Until 2030, Belgian gas
consumption is expected to be on the rise, mainly due to an increase in gas-fired electricity
generation as a consequence of the planned phase-out of nuclear electricity generationfrom 2022 to 2025. As regards the anticipated increase of gas demand in the coming
years, the federal government needs to co-ordinate with the regional governments todevelop integrated plans to meet the future gas demand in advance of the planned nuclear
phase-out.
Efficient use of natural gas and reducing GHG emissions are one of Belgium’s key energy
policies. The federal and regional governments are working on gas demand reduction, butwith considerable differences between the regions regarding concrete policy measuresand approaches, such as the regulation on limiting expansion of its natural gas distribution
grid in Flanders and the promotion of renewable gas in Wallonia. The Brussels-Capital
Region is planning a gradual phase-out of natural gas starting in 2030.

The N-1 criterion is an indicator to evaluate the supply resilience of a network. A network complies with this indicator
if it has enough technical capacity to satisfy total demand in the event of disruption of the single largest component of
the infrastructure.

4

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Regional governments have developed some specific policy measures and quantitative
targets towards future decarbonisation of the gas sector with a variety of strategies,
including the production of biomethane and hydrogen. Nevertheless, an integrated

strategy or plan, with specific targets for the share of low-carbon gases in the future gas
mix, has not been presented. The federal and regional governments should work todevelop strategies that clearly support national-level decarbonisation and include
quantitative targets to track progress.
Another issue relevant for gas security in Belgium is the conversion of its L-gas network to
H-gas. As production of L-gas from the Groningen field in the Netherlands is gradually
decreasing and expected to end in mid-2022, the government is taking steps to ensurethat this does not impact security of gas supply. The infrastructure conversion in Belgium
is progressing faster than anticipated, and the federal government intends to complete thetransition to H-gas by 2024, several years ahead of schedule. This timely planning of therelevant mitigation measures should be commended.
Moreover, the progress of the conversion is also discussed by the L-Gas Market
Conversion Monitoring Task Force set up in 2019 with representatives from Belgium,
France, Germany and the Netherlands, which monitors the progress of conversion in allaffected countries. As all four countries are involved in the L-gas market shift, this regional
approach should be continued for maintaining security of gas supply in Belgium. At thesame time, the conversion from L-gas should be used as an opportunity to reduce gas
demand, notably by encouraging consumers to switch from natural gas to electricity,
renewables or other low-carbon sources to achieve the country’s GHG reduction target.

ENERGY SECURITY

9. NATURAL GASAs the Belgian gas market was liberalised in 2007, any company wishing to supply gas
can access the gas networks, and choice of gas supplier is left to the discretion of theconsumer. In 2019, 26 companies were active on the Belgian wholesale market for naturalgas. The top three suppliers (Engie-Electrabel, EDF Luminus and Eni) had a market shareof 48% in 2019, down from 55% in 2018. Wholesale gas prices in Belgium follow thepattern of gas prices in neighbouring countries.
The three regions have separate retail gas markets. Retail gas prices in Belgium in 2019were low compared to IEA member countries, both for industry and for households.
Residential consumers that meet certain socio-economic criteria can buy gas at a social
tariff; the costs for this are borne by all gas consumers via a surcharge. More than 10% ofconsumers are eligible for this social tariff. While the need to protect vulnerable households
is an understandable priority, the IEA points out that policy mechanisms that artificiallyreduce the cost for energy products can distort markets, and can increase energy
consumption and related GHG emissions, and should preferably be ended. There areother measures to combat energy poverty without the risks and limitation associated withdirect payments and a strong focus should be placed on building renovations that reduceenergy demand and costs (see Chapter 2).

Belgium’s gas supply is supported by its well-developed and highly interconnected natural
gas network, which acts as a hub in the European gas network. There are two separate
gas markets and gas transmission systems in Belgium: one for distribution of L-gas andanother for H-gas, both managed by Fluxys Belgium, the national gas TSO. Regional
governments in Flanders, Wallonia and the Brussels-Capital Region have legalmonopolies on gas distribution in each region, where local DSOs are responsible for gas
distribution.

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Supplier switching rates vary significantly between the regions. In 2019, in the Flemish
Region, the switching rate was 28.5% whereas Wallonia and the Brussels-Capital Region
had quite low switching rates (5.56% and 2.3%, respectively).

9. NATURAL GAS

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Gas security in Belgium is supported by a variety of emergency response measures,
including both supply-side and demand-side measures. In the event of a natural gas supply
disruption, the DGE is the lead government department for the sector, while the TSO andthe gas companies are responsible for the operational management of an emergency. In
case of a severe gas emergency, implementation of non-market based measures can be
warranted if gas cannot be delivered through market-based and operational measuresalone. A number of measures such as constraint on firm capacity or curtailment of
non-protected customers and withdrawal of gas in storage can be activated as non-market
measures to mitigate the impact of a gas disruption.

The government of Belgium should:
 Develop integrated plans to meet future gas demand under different scenarios; inparticular, plan for the potential increase of gas consumption in the electricity
generation sector to offset the impact of the planned phase-out of nuclear power
generation.
 Develop strategies and plans for decarbonising the gas sector, including mid- tolong-term targets for low-carbon gases such as biomethane and hydrogen, in close
co-ordination with regional governments, some of which have already introduced theirown strategies.
 Continue sound planning and implementation of the conversion from L-gas to H-gas
in concert with neighbouring countries, taking into account the required flexibility forpeak demand and security of supply, and considering opportunities for electrification.

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Recommendations

ENERGY SECURITY

9. NATURAL GAS

9. NATURAL GAS

References
ACER (European Union Agency for the Cooperation of Energy Regulators) and CEER(Council of European Energy Regulators) (2020), ACER-CEER Market Monitoring Report(MMR) 2019,https://extranet.acer.europa.eu/en/Electricity/Market%20monitoring/Pages/CurrentEdition.aspx.
Balansys (2021), Who we are (web page), www.balansys.eu/la-societe.
CREG (Commission for Electricity and Gas Regulation) (2021), Tarif social [Social tariff],www.creg.be/fr/consommateur/tarifs-et-prix/tarif-social (accessed on 7 May 2021).
CREG (2020), Studie over de prijzen op de Belgische aardgasmarkt in 2019 [Study on
prices on the Belgian natural gas market in 2019] (study report),
www.creg.be/nl/publicaties/studie-f2139.
CREG (2019), Faits marquants tirés du rapport annuel 2019 de la CREG [Highlights of theannual report 2019 of the CREG], www.creg.be/fr/faits-marquants-tires-du-rapport-annuel2019-de-la-creg.
Deloitte (2022), The roadmap to a carbon neutral Flemish industry,
https://www2.deloitte.com/be/en/pages/impact-report-2020/stories/the-roadmap-to-acarbon-neutral-flemish-industry.html.
EC (European Commission) (2020), Emergency Plan Belgium,https://ec.europa.eu/energy/sites/ener/files/documents/23062020_emergency_plan_gas_belgium_2020.pdf.
EC (2019), Preventive Action Plan Belgium,https://ec.europa.eu/energy/sites/ener/files/documents/20190808_preventive_action_plan_belgium_2019.pdf.
Fluxys (2021a), Management and governance (web page),www.fluxys.com/en/company/fluxys-belgium/management-governance.
Fluxys (2021b), Onze infrastructuur [Our infrastructure] (web page),www.fluxys.com/nl/company/fluxys-belgium/infrastructure.
Fluxys (2021c), Indicative Investment Plan Fluxys Belgium & Fluxys LNG 2021-2030,
https://www.fluxys.com/-/media/project/fluxys/public/corporate/fluxyscom/documents/fluxysbelgium/corporate/tyndp/2021/tyndp_flx_be_lng_2021_2030_en_external.pdf.
Fluxys (2021d), Transmission (web page), www.fluxys.com/en/productsservices/activities/transmission.
Horslen, J. (2015), On the agenda: Belgium/Luxembourg set for first EU gas market
merger, ICIS (Independent Commodity Intelligence Services) (web site),www.icis.com/explore/resources/news/2015/09/28/9927198/on-the-agenda-belgiumluxembourg-set-for-first-eu-gas-market-merger.
IEA (International Energy Agency) (2021a), World Energy Statistics and Balances(database), https://iea.org/statistics (accessed on 7 May 2021).

IEA et al. (2021), L-Gas Market Conversion Review – Winter Report 2021,
https://zoek.officielebekendmakingen.nl/blg-925180.pdf.
LNG Industry (2021), Zeebrugge LNG takes FID for additional regasification capacity(web page), https://lngindustry.com/liquid-natural-gas/16022021/zeebrugge-lng-takes-fidfor-additional-regasification-capacity (accessed on 29 July 2021).
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IEA (2021b), Energy Prices and Taxes (database), https://iea.org/statistics (accessed on
7 May 2021).

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Platts (2021), Dutch court approves current production quota for Groningen gas field(web page), https://spglobal.com/platts/en/market-insights/latest-news/natural-gas/072121dutch-court-approves-current-production-quota-for-groningen-gas-field (accessed on
29 July 2021).

ENERGY SECURITY

9. NATURAL GAS

Key data (2020)
Net imports of crude oil: 529.1 kb/d (total imports 578.2 kb/d, total exports 49.1 kb/d), +7.7%
from 2010 to 2019, -22% from 2019 to 2020
Domestic oil products production: 585 kb/d (diesel 45%, other products 14%, motor
gasoline 12%, naphtha 10%, fuel oil 8%, liquified petroleum gas 6%, kerosene 3%), +1.5%
from 2010 to 2019, -21% from 2019 to 2020

ENERGY SECURITY

10. Oil

Net imports of oil products: 12.9 kb/d (total imports 521.5 kb/d, total exports 508.6 kb/d)
Oil consumption by sector: 542.3 kb/d (industry 32%, transport 29%, international bunkers
24%, residential buildings 10%, service buildings 3%), -3% from 2010 to 2019, -14% from2019 to 2020

Overview
Oil is Belgium’s main energy source, covering the largest share of TES and TFC.
From 2010 to 2020, the share of oil in TES fluctuated between a maximum of 62% in 2014
and a minimum of 50% in 2013, while the share of oil in TFC experienced an overall decline
from 49% in 2010 to 46% in 2020 (Figure 10.1).

Share of oil

Figure 10.1 Share of oil in the energy sector in Belgium, 2000-2020
70%
Total energy
supply

60%
50%
40%

Total final
consumption

30%
20%

Electricity
generation

10%

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020 IEA. All rights reserved.

Oil is the main energy source in Belgium, covering the largest shares of total final
consumption and total energy supply.
Source: IEA (2021a), World Energy Statistics and Balances (database), https://www.iea.org/data-and-statistics.

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0%
2000

10. OIL

In 2020, oil products covered 89% of transport energy demand, 40% of industry energy
demand (including feedstock) and 27% of building energy demand, which is notably higher
than the IEA average of 8% in 2019. Oil plays a minor role in electricity generation,accounting for 0.1% of generation in 2020. Belgium has no domestic crude oil production
and no proven oil reserves, relying entirely on imports for its crude oil supply. However,
Belgium has a large refining and petrochemical sector and is a net exporter of oil products.
The federal and regional governments aim to reduce oil demand, notably in the heating
sector, where oil is still used by a large number of households, and in the transport sector.
To reduce oil demand for transportation, the federal government should reduce or
eliminate taxes on advanced biofuels.
Belgium still operates a price-cap mechanism for most oil products. As the mechanism
substantially hinders market penetration of new low-carbon fuels, and thereby thedecarbonisation of the oil sector, the government should consider abolishing it.

Supply and demand
Crude oil trade
In 2019, Belgium’s crude oil net imports, including small shares of natural gas liquids andrefinery feedstocks, was 529 thousand barrels per day (kb/d) (578 kb/d imports and49 kb/d exports). Belgium’s location on the coast of Western Europe near major shipping
routes allows imports from numerous countries (Figure 10.2). Belgium’s crude oil supply
arrives mainly via ship at the Port of Antwerp. In 2020, Belgium’s crude imports cameprimarily from the Russian Federation (31%), followed by Saudi Arabia (19%), Norway(9.3%), Nigeria (8.7%), the United Kingdom (8.7%), the United States (7%) and Iraq
(4.6%), with the remaining 12.8% from other countries. All of Belgium’s crude oil andnatural gas liquids imports are used domestically by the country’s large refining andpetrochemical industry. Belgium exports a small amount of refinery feedstocks, historicallymostly to the United States via ship and since 2016 to the Netherlands via pipeline.

Net imports

Figure 10.2 Belgium’s net oil trade by country, 2000-2020
800

Iraq

kb/d

700

Nigeria600

United Kingdom

500

Norway400

Netherlands

Net exports

300

Saudi Arabia

200

United States100

RussianFederation
Other

0

- 100

Total net trade

Belgium relies entirely on crude oil imports for its supply, and exports a small amount ofrefinery feedstocks to the United States and the Netherlands.
Source: IEA (2021a), World Energy Statistics and Balances (database), https://www.iea.org/data-and-statistics.

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Oil products production and trade
Belgium’s production of oil products fluctuates based on regional demand and market
competition, but was relatively stable from 2009 to 2019, with the lowest production(676 kb/d) in 2013 and the highest (744 kb/d) in 2019 (Figure 10.3). In 2020, the refinery
output decreased to 585 kb/d as demand dropped due to the Covid-19 pandemic. The mixof oil products from Belgian refineries has been relatively stable and in 2019, production
consisted of 45% diesel, 12% gasoline, 10% naphta, 8% fuel oil, 6% LPG, 2% petroleum
coke and 14% other products. In 2020, production dropped especially for kerosene (-62%since 2019), fuel oil (-44%) and gasoline (-27%).
Figure 10.3 Oil products production in Belgium, 2000-2020
1 000

kb/d

Petroleum coke

900
800

Other products

700

Kerosene

600

ENERGY SECURITY

10. OIL

Naphtha500
400

Fuel oil300

Liquefied petroleum gas

200

Gasoline

100

Diesel0

IEA. All rights reserved.

Belgium’s oil products production fluctuates based on regional demand and market
competition, but has been stable since 2009.
Source: IEA (2021a), World Energy Statistics and Balances (database), https://www.iea.org/data-and-statistics.

Net imports

Figure 10.4 Belgium’s oil products net trade by country, 2000-2020
300

Francekb/dLuxembourg

200

Switzerland

100

United States
Germany0

Norway
Other

- 200

Netherlands- 300

RussianFederation
Total net trade

Net exports- 100

IEA. All rights reserved.

Belgium’s oil products trade includes imports and exports to a wide array of countries, andnet trade fluctuated between net imports and net exports, based on market conditions.

In 2020, domestic demand exceeded refinery output for most oil products excluding
gasoline, ethane and petroleum coke. Belgium’s oil products net trade has fluctuatedconsistently between net imports and net exports based on market conditions (Figure 10.4).
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Source: IEA (2021a), World Energy Statistics and Balances (database), https://www.iea.org/data-and-statistics.

10. OIL

From 2010 to 2020, net imports of oil products became more diversified with the traditionalreliance on imports from the Netherlands giving way to a supply also from countries
including the Russian Federation and the United States. Net exports remained focused on
the neighbouring countries of Germany, Luxembourg and France. In 2020, Belgium’s net
oil products trade was 12.9 kb/d of imports (522 kb/d imports and 509 kb/d exports) withmost net exports going to Germany (85 kb/d), France (32 kb/d), and Luxembourg (30 kb/d),and net imports coming from the Russian Federation (76 kb/d), Norway (26 kb/d), theUnited States (14 kb/d), and the Netherlands (13 kb/d).

Oil demand
Belgium’s oil demand peaked in 2008 at 687 kb/d and experienced an overall decline
through 2012 to 575 kb/d. From 2012 to 2018, oil demand experienced a steady increase,reaching 671 kb/d in 2018, before steeply declining in 2019 to 626 kb/d and droppingin 2020 to 542 kb/d as a consequence of the Covid-19 pandemic (Figure 10.5). Belgium’s
oil demand comes mainly from industry (32% of demand in 2020), domestic transportation(29%), and bunker fuels used for international navigation and aviation (26%). A notableshare of oil demand comes from oil-based heating in buildings (13% of demand in 2020),
while electricity generation accounted for just 0.04% of oil demand.
Industry sector oil demand increased from 2007 to a historic peak of 240 kb/d in 2014, but
has since experienced an overall decline to 196 kb/d in 2019 and 176 kb/d in 2020.
Demand for bunker fuels experienced notable fluctuations ranging, from 129 kb/d in 2014
to 209 kb/d in 2018. Domestic transport oil demand, which comes mostly from roadtransport, peaked at 181 kb/d in 2016, decreased slightly to 179 kb/d in 2019, then dropped
to 155 kb/d in 2020 due to the travel restrictions caused by the Covid-19 pandemic. As aresult of unusually cold weather, building oil demand peaked in 2010 at 85 kb/d (64 kb/d
residential and 20 kb/d service sector). Since 2010, oil demand in both residential andservice sector buildings has experienced an overall decline, and in 2020 building oil
demand was at 61 kb/d (52 kb/d residential and 16 kb/d service sector).
Figure 10.5 Oil demand by sector in Belgium, 2000-2020
700

kb/d
International
bunkers

600

Electricity andheat generation

500
400

Residentialbuildings

300

Servicesbuildings

200

Industry

100
Transport0

Belgium’s oil demand has fluctuated, with a peak in 2008, a decrease until 2012 and a steadyincrease until 2018. Demand then decreased by 6% in 2019 and 14% in 2020.
Source: IEA (2021a), World Energy Statistics and Balances (database), https://www.iea.org/data-and-statistics.

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By product, in 2019, diesel has accounted for the largest share of oil products demand(45%), while naphtha, used primarily for chemical industry processes, accounted for thesecond-largest share (19%). LPG accounted for 11% of oil products demand and is mainly
used in industry, with a small share coming from LPG powered vehicles. Motor gasoline
accounted for 10% of oil products demand.

Oil policy
Belgium’s energy policy is focused on reducing oil demand while ensuring security of oil
supply. Belgium does not have a specific oil demand reduction target, but the NECP
defines a wide range of measures that will drive significantly lower oil demand in line with
Belgium’s target to reduce GHG emissions from sectors outside of the EU ETS by 35%
by 2030 versus 2005 levels (see Chapter 2). As oil is used in most sectors of Belgium’s
economy, responsibility for oil policy and demand reduction measures are divided between
the federal and regional governments. The federal government is responsible for the
taxation of oil products, security and quality of Belgium’s oil supply, and transportation
biofuels blending. The regional governments set policy in key areas affecting oil demand,such as vehicle taxation, urban planning, transport policy, and energy efficiency inbuildings and industry.

ENERGY SECURITY

10. OIL

Belgium aims to reform federal taxation to make it more climate- and environmentallyfriendly, following the polluter-pays principle and sending price signals driving
decarbonisation. In support of this tax reform, the federal government will carry out a study
in consultation with the regional governments to be published in 2022 with a goal topropose fiscal reforms by late 2023. The federal government has indicated that this reform
is an opportunity to create price signals that will reduce oil demand. The federal
government is also using tax policy to favour gasoline vehicles over diesel vehicles. The
excise on diesel has been progressively increased to bring it in line with the excise on
gasoline. Since July 2018, the excises on diesel and gasoline are the same (EUR 600.16
per 1 000 litres). The federal government has established a working group analysing thepossibility to further increase the excise duty on diesel.

The regional governments are taking other steps to reduce oil demand from buildings.
Flanders aims to gradually reduce oil heating in buildings. There is a legislative proposal
in the Flemish Parliament to ban the installation of oil heating when there is a possibility ofconnecting to the gas grid. Wallonia is working on a plan to encourage replacing oil heatingwith less carbon-intensive alternatives including renewables, district heating and gas. The
Brussels-Capital Region aims to end all fossil fuel-based heating by 2050. In support of141

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In 2021, Belgium sent the European Commission a required inventory of energy subsidies,including those for fossil fuels. In 2019, the subsidies with the largest forgone tax revenues
were the reduced excises for heating oil (EUR 2.1 billion in forgone federal tax revenue)
and the tax and fiscal treatment of company cars (approximately EUR 2 billion in forgone
federal tax revenue). The federal government will examine options to eliminate fossil fuelsubsidies as part of the reform of taxation to make taxation climate- and environmentallyfriendly, and has committed to developing an action plan to gradually phase-out fossil fuelsubsidies. The regional governments have also taken steps to eliminate support foroil-based heating in buildings.

10. OIL

this goal, it is considering legislation to ban the installation of new oil heating systems
starting in 2025 and subsidies for the replacement of oil heating with more efficient andless emitting options.
The federal government’s Social Heating Fund provides residential consumers that meetcertain socio-economic requirements with direct payments covering a portion of the costs
for oil-based heating (kerosene, propane, heating oil). Payments depend on the price paid
for the fuel and range from EUR 210-300 per year per household. The Social Heating Fundis financed through a federal contribution charge to consumers purchasing oil products
intended for heating. From 2015 to 2019, the number of households receiving paymentsfrom the Social Heating Fund decreased from 96 588 (2% of households) to 85 813 (1.73%
of households).
The main federal measure to reduce transport oil demand is a biofuels blending mandate,
which requires all companies selling road transportation fuels (including diesel andgasoline) to blend a certain share of biofuels by energy content (9.55% in 2021). The
NECP proposes annual increases in the required share of biofuels blending to reach
13.9% in 2030 (see Chapter 5). The federal government is also pushing to reduce oil
demand by changing company car fiscal incentives to favour EVs (see Chapter 4).
Regional governments aim to lower transport oil demand through price signals that favour
the adoption of EVs and low-emission vehicles. The regional governments are responsible
for vehicle taxation, which is proportional to vehicle emissions, while EVs are exempt fromvehicle taxes. This provides financial incentives to purchase lower emission (and more
efficient) vehicles. The regional governments support EVs through the deployment ofcharging infrastructure. They also have a variety of programmes and targets that reduceoil demand though modal shifts away from the use of private cars. These include targets
for electrification of government and public transport vehicles, for reductions in passenger
kilometres, and for phasing out diesel and gasoline cars. The regional governments also
have mobility plans pushing for more public transportation, improved logistics, and more
walking and cycling (see Chapter 4).

Retail market structure

As of March 2021, over 3 000 of service stations were in operation in Belgium. This number
has not significantly changed since 2016. Market shares in terms of the number of filling
stations are competitive, with the top three companies (Kuwait Petroleum,
Etablissementen J. Maes Zonen and Belgian Shell) accounting for only one-fifth of thetotal number of stations. The market for heating gasoil is more concentrated, with morethan two-thirds of the market share in the hands of three major companies: Total (41.4%),
Varo Energy (20.4%) and ExxonMobil (9.6%).

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A number of major companies are involved in oil products supply in Belgium. Market
shares for gasoline and road diesel indicate a competitive market. For both gasoline androad diesel, Total has the largest market share (around 30%). The main suppliers are
Total, Varo Energy, Kuwait Petroleum, ExxonMobil, Lukoil, Shell and Van Raak Distributie
for road diesels, and together account for more than 90% of road fuel sales.

Prices and taxation
Belgium sets maximum prices for most oil products through a price-capping mechanism,with maximum prices based on a contract between the federal government and the Belgian
Petroleum Federation, the official representative of the main oil companies active in thefields of refining, marketing, distribution and storage in Belgium. The contract is reviewed
every three years, but can be terminated at any time by either party. Cancellation of thecontract would result in a return to the previous price-capping mechanism, where prices
are set directly by the federal government (FPS Economy, 2020).
The most recent contract requires maximum prices to be set for gasoline, diesel, heating
gasoil, other kerosene, propane, LPG and heavy fuel oil. Maximum prices are based on
Argus quotations of finished product prices on the Rotterdam market plus a maximum
gross distribution margin per product (set by the contract). The DGE of the Federal PublicService Economy (FPS Economy) calculates maximum prices each workday according to
the contract and publishes these prices on line and communicates them by e-mail and fax
to retail suppliers. Since July 2017, LPG products sold in bottles or other mobile containers
are no longer subject to a maximum price.

ENERGY SECURITY

10. OIL

Taxes and fees on oil products include an excise duty, a special excise duty, an energy
levy, VAT, and federal contributions supporting the oil stockholding entity (APETRA) andthe fund for soil remediation projects at service stations. The prices of oil products intended
for heating (propane, kerosene and heating oil) include a contribution to the Social Heating
Fund. There are notable tax exemptions or reductions for certain uses of oil products,
especially related to industry and agriculture, with the overall effect that industry andbusinesses pay lower tax rates than households.
In the third quarter of 2020, Belgium’s price for automotive diesel was the second-highest
among IEA member countries (1.58 USD per litre [USD/L], with a tax rate of 62%)
compared to the IEA average of 1.24 USD/L and a tax rate of 53%. Belgium’s price forpremium unleaded gasoline (95 RON) was the eighth-highest among IEA member
countries (1.61 USD/L, with a tax rate at 61%), compared to the IEA average of 1.40 USD/L
and a tax rate of 59%. For light fuel (a major source of heating in Belgium), Belgium’s price
was the third-lowest among IEA member countries (0.52 USD/L and a 22% tax rate),compared to the IEA average of 0.77 USD/L and a tax rate of 34%.

Infrastructure

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Belgium has well-developed oil infrastructures, including a large import terminal at the Portof Antwerp, several large refineries, notable oil storage capacity and extensive pipeline
infrastructure (Figure 10.6). Belgium’s oil infrastructure and its central location in Europe
give it an important role in regional oil products trade.

10. OIL

Figure 10.6 Oil infrastructure in Belgium

Oil imports
The Port of Antwerp is Belgium’s main sea terminal for oil trade (both crude and oil
products), and is a major refuelling site for international shipping. The Port of Antwerp isalso home to most of Belgium’s refining and chemical production capacity. The smaller
Port of Zeebrugge is served by two oil products pipelines and has a storage for marine
bunker fuels and a terminal for refuelling of international shipping.
The Rotterdam Antwerp Pipeline (RAPL) is Belgium’s only cross-border pipeline for crude
oil trade. It connects the major crude import terminals and refining facilities of the Port of
Antwerp and the Port of Rotterdam in the Netherlands and has a capacity of 650 thousand
tonnes per year (RAPL, 2021). Historically, the RAPL was used to deliver crude oil fromthe Netherlands to Belgium, but since 2016 it has been used to export refinery feedstocks
from Belgium to the Netherlands.

Transportation

The CEPS is a North Atlantic Treaty Organization (NATO) pipeline network that runs
through Belgium, France, Germany, Luxembourg and the Netherlands, comprising
6 000 km of pipelines and connecting to roughly 8.2 million barrels (mb) of oil storage
capacity. NATO maintains this distribution system primarily to provide fuel supply support
to military bases. However, the pipeline’s surplus capacity is leased for civiliantransportation of oil products. The contracts between NATO and the oil companies using

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Crude oil and oil products in Belgium are mainly transported though pipelines, including
the Central European Pipeline System (CEPS) and the RAPL. Oil products are also
imported and transported via inland waterways, rail and trucks. The Port of Antwerp is
Belgium’s central hub for oil transportation, with over 1 000 km of pipelines for around50 different oil products (Port of Antwerp, 2019).

the CEPS are based on market prices and supervised by Belgium’s Federal Ministry of
Economic Affairs (NATO, 2017).

Refining
Belgium’s four refineries are strategically located near the Port of Antwerp and have a
combined crude distillation capacity of 679 kb/d, equivalent to 33 million tonnes (Mt) per
year. The refinery owned by Total (with a capacity of 353 kb/d) and the refinery owned by
ExxonMobil (with a capacity of 326 kb/d) together account for 85% of Belgium’s refining
capacity. Both can produce a high yield of light and middle distillates, and are among thelargest refineries in Europe. Notable improvements have recently been made in both ofthese refineries. During 2018 and 2019, a delayed coker unit was installed at the
ExxonMobil refinery, greatly improving the thermal cracking-coking capacity andincreasing the output of lighter oil fractions. In the Total refinery, a de-asphalting unit was
installed, allowing transformation of heavy oil fractions into light products. Total also madeinvestments to improve its petrochemical plant and refinery. Refinery gross output in 2020
was 578.2 kb/d, down from 744.0 kb/d in 2019 primarily due to the demand reduction
caused by the Covid-19 pandemic.

ENERGY SECURITY

10. OIL

As a refining hub, Belgium depends to a large extent on imports of crude oil, while therefining sector allows Belgium to produce a large number of oil products within the country.
To bolster the growth of the refining sector by improving refinery-utilisation, and thereforeof the domestic production of oil products, the federal government deems that the refining
industry needs continuous support. In fact, Belgium has a plan to promote investment inrefineries to ensure as much independence as possible, both nationally and internationally,
during the period 2020-30 (EC, 2019).
Belgium has collaborated with the EU Refining Forum in recent years. The aim of the forum
is to provide an opportunity for the industry, EU countries, members of the European
Parliament, the European Commission and other stakeholders to discuss planned andfuture regulatory proposals with potentially significant impacts on the EU oil refining
industry and on the EU’s security of supply of petroleum products. The current discussion
focuses on the role of the EU refining industry in the coming years and how it will address
climate change, the competitive challenges refining and other energy-intensive industries
face, and their contribution to the clean energy transition.

Storage
In 2020, Belgium had 50 oil storage facilities with a total capacity of 110.4 mb, mainly foroil products. All oil storage capacity in Belgium is privately owned and operated and isused mainly to support commercial operations, but also to provide emergency reserves toaddress supply disruptions. The majority of Belgium’s oil storage (44%) is located at thePort of Antwerp to support the large concentration of refineries and petrochemical facilities.

The Petroleum Agency (APETRA) is a public company owned by the federal governmentthat is responsible for purchasing and managing emergency stocks of crude oil and oil
products to ensure Belgium’s security of oil supply and to meet international oil reserve
obligations. APETRA holds oil stocks under long-term contracts in private storage facilities.
It is funded by a fee charged on most oil products consumed in Belgium (APETRA, 2021).
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Oil emergency response and stockholding10. OIL

The National Oil Board (NOB) is responsible for the supply and distribution of crude oil andoil products during an emergency. It has a mandate to restrict demand and share available
supplies in the event of an oil supply shortage. The NOB is also responsible for activities
related to Belgium’s international commitments in energy crisis management. The NOB isan advisory body, comprised of representatives from the DGE, APETRA, the cabinet ofthe minister and the crisis cell of the FPS Economy.
Belgium’s response to oil supply shortages in emergency situations is primarily governedby the 1976 Law Approving the Agreement on the IEA’s International Energy Programme
and the Compulsory Stockholding Act (CSA). The Law Approving the Agreement provides
for a very general legal framework aimed to protect Belgium’s oil supply. The CSA
implements EU Directive 2009/119/EC and lays out a specific legal framework concerning
the protection of Belgium’s energy supply by stockholding crude oil and other petroleum
products. Moreover, new decrees which have been adopted in recent years bolster thelegal framework of Belgian oil emergency response, including Royal Decree of
19 December 2018 concerning the update of the Belgian oil National Emergency Strategy
Organisation (NESO) and Royal Decree of 5 February 2019 establishing measures in an
emergency oil supply.
Oil emergency response policy in Belgium is the responsibility of the federal Minister for
Energy, in consultation with the Council of Ministers. Under the federal Minister for Energy,
the DGE, within the framework of the NOB, serves as the core of the Belgian oil NESO.
The NESO team is responsible for advising the federal Minister of Energy on maintaining
and implementing emergency response measures during a supply disruption. The NOB is
responsible for monitoring domestic oil markets and for data collection.
The NOB has a central role to co-ordinate with the federal Minister for Energy and theCouncil of Ministers in case of an oil supply crisis and to advise the federal Minister for
Energy on the method of the release of stocks and co-ordinates the duration, nature andnumber of stocks to be released. The board also organises emergency response exercises
in collaboration with APETRA and in communication with the oil industry on a regular basis.
A key component of the Belgian oil emergency response is a stock drawdown, and the
CSA lays down the use of oil emergency stocks. According to the law, at the time ofrequiring emergency response, the federal Minister for Energy is entitled to decide to
temporarily use part of the compulsory emergency stocks and may authorise a temporary
reduction of them. In case of potential international or national supply problems, if the DGE
decides that a meeting of the NOB is needed, the NOB will discuss the situation and form
an opinion. Provided that the NOB deems that there is a crisis situation, this advice istransferred by the DGE to the federal Minister for Energy. Upon approval by the minister,
the NOB shall advise on the nature, amount and duration of stocks to be released andimplement crisis measures in close co-ordination with APETRA.

The CSA forms the legal backbone of the Belgian legislation on compulsory oil stocks.
APETRA is the sole manager of the Belgian compulsory oil stocks. According to the CSA,APETRA needs to hold oil stocks equivalent to at least 90 days of net imports, and ofwhich in 2021 at least 30% should be key products that account for more than 75% of oil
product demand (in 2021 key products were diesel, heating oil and gasoline). The CSA
requires that APETRA’s crude stocks be less than 60% of APETRA’s total stocks andproduct stocks held abroad should be less than 30% of total product stocks.
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Emergency oil reserves

Belgium meets its stockholding obligation to the IEA by holding public stocks managed by
APETRA. All Belgian oil emergency stocks are APETRA’s agency stocks; there is nocompulsory stockholding obligation on the Belgian oil industry. Belgium has a strong trackrecord of compliance with the IEA 90-day obligation (Figure 10.7). As of end-December
2021, Belgium held stocks equivalent to 198 days of net imports (101 days of which are
public stocks and 96 days are commercial industry stocks). According to the IEA
methodology, the total volume of stocks held was 56.0 mb, around 30.7 mb in excess ofthe quantity required to meet the 90-day obligation (25.6 mb). As of end-March 2021,
APETRA’s oil stocks on national territory consisted of 98% of middle distillates and 2% of
motor gasoline, while Belgium held 17.1 mb of oil stocks abroad (in France, Germany and
the Netherlands), of which 89% consisted of crude oil stored in caverns in Germany.
Oil stocks owned by APETRA for emergency purposes are stored in storage facilities theagency rents in Belgium and its neighbouring countries. APETRA currently rents storage
capacity in 16 storage facilities in Belgium with a total storage capacity of 11.4 mb, mainly
for middle distillates. All of APETRA’s crude oil storage is in Germany and has a capacityof 15.3 mb. APETRA also uses storage facilities for middle distillates, gasoline and jet fuelin France, Germany and the Netherlands; together these facilitates have a storage
capacity of 2.5 mb. The storage capacities are rented through contracts between 3 and15 years and are allocated through competitive tenders. APETRA does not operate thefacilities and has no responsibility for transporting oil coming from these facilities.

ENERGY SECURITY

10. OIL

Figure 10.7 Emergency oil stocks by type in Belgium, December 2021
250

days of net imports
Abroad public

200
150

Abroadindustry100

Industry
domestic

50

Publicdomestic

090-day net
imports

Belgium’s oil stocks have consistently been above the IEA’s 90-day emergency oil stock level
requirement.
Source: IEA (2021b), Monthly Oil Data Service, https://www.iea.org/data-and-statistics.

Oil is the principal energy source in Belgium, covering the largest share of energy supply
and demand. From 2012, oil demand rose steadily, reaching 670.0 kb/d in 2018, before
steeply declining to 625.4 kb/d in 2019. Belgium’s oil demand comes mainly from industry(29% of demand in 2019), bunker fuels used for international navigation and aviation(30%), and domestic transportation (29%). A notable share of oil demand comes fromoil-based heating in buildings (11% of demand in 2019). Belgium’s oil supply is supported
by its well-developed oil infrastructure, including the import terminal at the Port of Antwerp,
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Assessment

10. OIL

four major refineries, abundant oil storage capacity, and extensive pipeline infrastructure
for domestic and cross-border transportation.
Belgium’s energy policy is focused on reducing oil demand while ensuring security of oil
supply. Belgium’s NECP defines a wide range of measures that will drive lower oil demandin line with target to reduce GHG emissions from non-ETS sectors by 35% by 2030 versus
2005 levels. Belgium’s main measures for reducing oil demand focus on the buildings andtransport sectors. As oil is used in most sectors of Belgium’s economy, responsibility foroil policy and demand reductions measures are divided between the federal and regional
governments.
The regional governments are working to reduce building oil demand. Flanders is planningto ban the replacement of existing oil-based heating systems when a connection to thegas grid is possible from 2022 onwards. Wallonia is working on a plan to encourage
replacing oil heating with less carbon-intensive alternatives including renewables, district
heating and gas. The Brussels-Capital Region plans to gradually phase out oil-basedheating. In 2019, oil covered 24% of building energy demand, which is notably higher thanthe IEA average of 8%. Belgium should accelerate the transition away from oil-basedheating, with a focus on electrification and renewable energy.
Belgium aims to reduce transport oil demand through taxation that favours more efficient
vehicles and EVs, and through the promotion of EV charging infrastructure and a modal
shift away from private cars. The main federal measure to reduce transport oil demand isa biofuels blending mandate, which requires all companies selling road transportation fuels
to blend a certain share of biofuels by energy content (9.55% in 2021). The NECP
proposes annual increases in the required share of biofuels blending to reach 13.9%
in 2030. However, there are no tax incentives to promote the use of biofuels in thetransport sector. The federal government should examine biofuels taxation in theupcoming review of fiscal policy and consider decreasing or eliminating taxes on advanced
biofuels to limit price impacts and further promote biofuels deployment in the transport
sector. This could help support a cost-effective achievement of Belgium’s target for
renewable energy in transport, while limiting the social impacts of transport fuel costs.

The oil demand reduction measures needed to meet climate goals will also have a major
impact on Belgium’s economically critical refining sector. The Belgian authorities should
work with the oil sector to increase efficiency, lower emissions, and support a transition to
the production of low-carbon fuels and feedstocks. It is commendable that Belgium closely
co-operates with its neighbouring countries and collaborates with the EU Refining Forumin this area.
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Implementation of the federal and regional oil demand reduction policies would result in asignificant reduction in Belgium’s oil demand. The Belgian Petroleum Federation estimatesthat if the oil demand reduction measures of the NECP are put in place, fuel demand frompassenger cars would decrease by 45% between 2018 and 2030. The increased EU-wide
55% GHG reduction target could require even stronger reductions in Belgium’s oil demand.
This reduction in fuel consumption will affect economic conditions of fuel distribution;
distribution companies and service stations will need to change their business models. In
this respect, the Belgian authorities should discuss, with the oil industry, including
distribution companies on how to address expected future transformations of the oil
distribution system, and with the business continuity of relevant industries in the medium
and long term.

The federal government sets maximum prices for most oil products through a
price-capping mechanism. Price caps are currently set for gasoline, diesel, heating oil,kerosene, propane, heavy fuel oil and LPG (except LPG sold in bottles or mobile
containers). Price-setting mechanisms have long disappeared in most IEA member
countries, resulting in dynamic retail markets for transport fuels without negative impacts
on consumers. The price-setting mechanism adds administrative burdens and costs forthe federal government and Belgium’s oil companies, while providing no clear benefits. In
the third quarter of 2020, Belgium’s price for automotive diesel was the second-highest
among IEA member countries while the price for premium unleaded gasoline was theeighth-highest. The price-setting mechanism is also a potential barrier to the adoption ofsustainable biofuels and other new low-carbon fuels as they lack a reference price. The
IEA has consistently recommended that Belgium abolish the maximum price mechanism(most recently in the 2016 and 2013 energy policy reviews). The Belgian Petroleum
Federation has also notified the government of its preference for a free market pricing
system. The federal government should abolish the price-setting mechanism.

ENERGY SECURITY

10. OIL

Recommendations
The government of Belgium should: Examine biofuels taxation in the upcoming review of fiscal policy and consider
decreasing or eliminating taxes on advanced biofuels, to limit price impacts and further
promote biofuels deployment in the transport sector.
 Work with the Belgian oil sector to increase efficiency, lower emissions and support atransition to the production of low-carbon fuels and feedstocks.

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 End the maximum price mechanism to promote effective competition in the sector andfacilitate the introduction of renewable fuels.

10. OIL

References
APETRA (2021), General info (web page), https://www.apetra.be/en/general-info (accessedon 16 July 2021)
FPS Economy (2020), Prix maximum des produits pétroliers [Maximum price of petroleum
products] (web page), https://economie.fgov.be/fr/themes/energie/prix-de-lenergie/prixmaximum-des-produits (accessed on 7 May 2021)
IEA (International Energy Agency) (2021a), World Energy Statistics and Balances(database), https://www.iea.org/data-and-statistics (accessed on 7 May 2021)
IEA (2021b), Monthly Oil Data Service, https://www.iea.org/data-and-statistics
NATO (North Atlantic Treaty Organization) (2017), Central Europe Pipeline System (CEPS)(web page), www.nato.int/cps/en/natohq/topics_49151.htm (accessed on 28 June 2021)
Port of Antwerp (2019), Pipelines (web page), www.portofantwerp.com/en/pipelines(accessed on 28 June 2021)

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RAPL (Rotterdam Antwerp Pipeline) (2021), RAPL homepage (web page), www.rapl.nl(accessed on 28 June 2021)

Review criteria
The Shared Goals, adopted by the IEA Ministers at their 4 June 1993 meeting in Paris, provide theevaluation criteria for the in-depth reviews. The IEA Shared Goals are available online.

ANNEXESANNEX A: Review team and supporting stakeholders

Review team and preparation of the report
The IEA’s in-depth review visit of Belgium took place virtually from 26 April to 7 May 2021. The review
team met with government officials, energy suppliers, market participants, interest groups, consumer
associations, research institutions and other stakeholders. This report was drafted based on information
obtained in these meetings, the review team’s assessment of Belgium’s energy policy, the government’s
response to the IEA energy policy questionnaire and subsequent research by the IEA. The members of
the team were

IEA member countries
Mr. Astrid Sontag, Switzerland (team leader)
Ms. Ellen van der Velden, United Kingdom
Ms. Aneta Ciszewska, Poland
Ms. Işın Ünver Baş, Turkey
Mr. René Nastoupil, Czech Republic
Mr. Ermin Kloppenborg, Netherlands
Mr. Morten Anker, Norway

European Union
Ms. Clémence Bruand

Nuclear Energy Agency
Mr. Antonio Vaya Soler

International Energy Agency
Mr. Aad van Bohemen
Mr. Shuto Fukuoka

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Mr. Peter Journeay-Kaler

ANNEXESThe team is grateful for the co-operation and assistance of the many people who supported the review.
Thanks to their hospitality, openness and willingness to share information, the visit was highly informative,
productive and enjoyable. The team expresses its gratitude to Minister Tinne van der Straeten and
Director General for Energy Nancy Mahieu, whose comments helped frame all the discussions during thereview. The team also extends a special thanks to Mr. Lenhard Vanhoorn for his tireless efforts inco-ordinating the review visit, prompt responses to the team’s many requests, and patience throughout
the weeks leading up to and during the review.
The review was prepared under the guidance of Mr. Aad van Bohemen, Head of the Energy Policy andSecurity Division, IEA. Mr. Peter Journeay-Kaler managed the review and is the author of the report.
Mr. Shuto Fukuoka and Ms Kiyomi Hyoe co-ordinated the emergency response component of the review
and contributed to the chapters on oil, natural gas and electricity. Mr. Alessio Scanziani wrote the chapter
on energy efficiency. Mr. Antonio Vaya Soler wrote the chapter on nuclear energy. Mr. Alessio Scanziani,
Ms. Clémence Lizé, Ms. Alan Choi, Ms. Myriam Badri and Ms. Jiyul Shin prepared and drafted thesections relating to energy data contained in each chapter. Helpful comments, chapter reviews andupdates were provided by the following IEA staff: Ms. Sara Moarif, Mr. Kieran McNamara, Ms. Jinsun Lim,
Ms. Vida Rozite, Mr. Simon Bennet, Mr. Pablo Hevia-Kock, Mr. Gergely Molnar and Ms. Toril Bosoni.
Special thanks to the IEA secretariat with regard to the data, publication and editing. Ms. Astrid Dumond,
Ms. Isabelle Nonain-Semelin and Ms. Taline Shahinian managed the layout and publication.
Ms. Roberta Quadrelli, Mr. Steve Gervais, Mr Arnau Risquez Martin and Ms. Laura Mari Martinez
provided support on statistics. Ms. Therese Walsh managed the editing process. Mr. Jad Mouawad and
Mr. Jethro Mullen supported the press launch. Ms. Jennifer Allain was the editor.

Meetings were held with the following organisations
AgoriaBelgian Ambassador OECD-UNESCO Paris
Belgian Biodiesel Board (BBB)
Belgian Bioethanol Association (BBA)
Belgian Competition Authority
Belgian ESCO Association (BELESCO)
Belgian Federation of Fuel Dealers (Brafco)
Belgian Nuclear Research Centre (SCK CEN)
Belgian Petroleum Federation
Belgian Science Policy Office (BELSPO)
Bond Beter Leefmilieu
BrugelBrussels Agency of Innovation (Innoviris)
Cabinet Brussels Minster Maron
Cabinet Federal Minister of Energy
Cabinet Flemish Minister Demir
Cabinet Walloon Minster Henry
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Brussels-Capital administration

Commission for Electricity and Gas Regulation (CREG)
Elia
EnergyVille/Imec
EnergyVille/KULeuven
FEBEG/member Engie-Electrabel
Federal Buildings Agency
Federal Minister of Energy

ANNEXESANNEXES

Federal Planning Bureau
Federal Public Service (FPS) Economy
Federal Public Service (FPS) Environment
Federal Public Service (FPS) FinanceFederal Public Service (FPS) Foreign Affairs
Federation of Belgian Electricity and Gas Companies (FEBEG)
Federation of Belgian Industrial Energy Consumers (FEBELIEC)
Federation of Enterprises in Belgium (VBO/FEB)
Federation of Renewable Energy Producers (EDORA)
Flemish administration
Flemish Regulator for Electricity and Gas (VREG)
FluxysGreenpeaceInter Environnement Wallonie
Organisation for Sustainable Energy (ODE) Vlaanderen
Petroleum Agency (APETRA)
Synergrid
Testaankoop/Test Achats
University of Liège
University of Mons
Walloon administration

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Walloon Commission for Energy (CWaPE)

ANNEXESANNEX B: Glossary and list of abbreviations
In this report, abbreviations and acronyms are substituted for a number of terms used within theInternational Energy Agency. While these terms generally have been written out on first mention, thisglossary provides a quick and central reference for the abbreviations used.

Acronyms and abbreviations
AC

alternating current

CCGT

combined-cycle gas turbine

CCIEP

Coordination Committee for International Environmental Policy

CCUS

carbon capture, utilisation and storage

CEPS

Central European Pipeline System

CREG

Commission for Electricity and Gas Regulation

CRM

capacity remuneration mechanism

CSA

Compulsory Stockholding Act

DGE

Directorate-General for Energy

DLR

dynamic line rating

DSO

distribution system operator

DSR

demand-side response

EC

European Commission

EED

Energy Efficiency Directive

ENS

energy not supplied

ESD

Effort Sharing Decision

ESR

Effort Sharing Regulation

ETS

Emissions Trading System

EU

European Union

EUR

euro

EV

electric vehicle

FEC

final energy consumption

FPS

Federal Public ServiceGDPgross domestic product

GHG

greenhouse gas

GTS

Gasunie Transport Services

H-gas

high-calorific gas

HHI

Herfindahl-Hirschmann Index

HVDC

high-voltage direct current

IEA

International Energy Agency

L-gas

low-calorific gas

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Commission de Régulation de l’Électricité et du Gaz

LNG

liquefied natural gas

LPG

liquefied petroleum gas

LULUCFland use, land-use change and forestry

NATO

North Atlantic Treaty Organization

NCC

National Climate Commission

NDP

network development plan

NECP

National Energy and Climate Plan

NESO

National Emergency Strategy Organisation

NOB

National Oil Board

OECD

Organisation for Economic Co-operation and Development

ONDRAF

National Agency for Radioactive Waste and Enriched Fissile Materials

ANNEXESANNEXES

Organisme national des déchets radioactifs et des matières fissiles enrichies
PEC

primary energy consumption

PHEV

plug-in hybrid electric vehicle

PREC

Regional Program for a Circular EconomyPVphotovoltaics

RAPL

Rotterdam Antwerp Pipeline

R&D

research and development

RD&D

research, development and demonstration

RED

Renewable Energy Directive

SAIDI

System average interruption duration index

SAIFI

System average interruption frequency index

SDR

strategic reserve delivered by a reduction in the offtake on the demand side

SET Plan

Strategic Energy Technology Plan

SGR

strategic reserve delivered by generation units

SME

small and medium-sized enterprise

STI

science, technology and innovation

TES

total energy supply

TFC

total final consumption

TFEC

total final energy consumption

TSO

transmission system operator

UNFCCC

United Nations Framework Convention on Climate Change

USD

United States dollar

VAT

value-added tax

Units of measurebcm

billion cubic metres

GW

gigawatt

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Programme Régional d'Économie Circulaire

GWhgigawatt-hourkb/dthousand barrels per day

kmkilometrekVkilovolt

L

litre

mcm

million cubic metresktoekilotonne of oil equivalentkWekilowatt electricalkWhkilowatt-hourMJmegajouleMt

million tonnes

Mt CO2

million tonnes of carbon dioxide

Mt CO2-eq

million tonnes of carbon dioxide equivalentMWmegawatt

t CO2

tonne of carbon dioxide

TJ

terajouletoetonne of oil equivalentTWhterawatt-hour

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ANNEXESANNEX C: Statistical notes

Statistical notes• Unless otherwise noted, all GDP data are in USD 2015 prices and purchasing power parity.
• Total energy supply (TES) comprises production + imports – exports – international marine andaviation bunkers ± stock changes. This equals the total supply of energy that is consumed
domestically, either in transformation (e.g. power generation and refining) or in final use.

ANNEXESANNEXES• Total final consumption (TFC) is the final consumption of energy (electricity, heat and fuels, such as
natural gas and oil products) by end users, not including the transformation sector (e.g. power
generation and refining).
• Total final energy consumption (TFEC) excludes non-energy use which is counted in TFC. TFEC
provides a more accurate assessment of the share of energy demand covered by renewable energy
and is better aligned with the European Union’s gross final energy consumption metric, which is used
to set EU member states’ renewable energy targets.
• The primary energy equivalent of nuclear electricity is calculated from the gross generation by
assuming a 33% conversion efficiency. The calculation to be carried out is the following: grosselectricity generation in TWh x 0.086/0.33 = primary energy equivalent in Mtoe.
• Bioenergy refers to solid and liquid biofuels, renewable waste, and biogas and excludes nonrenewable waste.
• Buildings includes the energy use of the residential sector (residential buildings) and commercial andpublic service sectors (service sector buildings).
• Transport excludes international aviation and navigation.
• Industry includes both energy and non-energy use of the industry sector, agriculture, forestry andfishing.
• Non-energy use refers to fuels used as raw materials, and not used as fuel or transformed into another
fuel. This comprises typically raw materials used in the chemical and petrochemical sector.
• IEA30 is the equivalent of a weighted average of 30 IEA member countries.

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• “CO2 emissions from fuel combustion” have been estimated using the IPCC Tier I Sectorial Approach
methodology from the 2006 IPCC Guidelines. Emissions from international marine and aviation
bunkers are not included in national totals.

This publication reflects the views of the IEA Secretariat but does not necessarily reflect those ofindividual IEA member countries. The IEA makes no representation or warranty, express or implied, inrespect of the publication’s contents (including its completeness or accuracy) and shall not be
responsible for any use of, or reliance on, the publication.
Unless otherwise indicated, all material presented in figures and tables is derived from IEA data andanalysis.
This publication and any map included herein are without prejudice to the status of or sovereignty
over any territory, to the delimitation of international frontiers and boundaries and to the name of any
territory, city or area.
IEA. All rights reserved.
IEA Publications
International Energy Agency
Website: www.iea.org
Contact information: www.iea.org/about/contact
Typeset in France by IEA - April 2022
Cover design: IEA

Belgium 2022

Energy Policy Review
The International Energy Agency (IEA) regularly conducts in-depth peer reviews of the energy
policies of its member countries. This process supports energy policy development andencourages the exchange of international best practices and experiences to help drive secure,affordable and clean energy transitions.
Belgium’s energy and climate policies push for energy transition through expanding renewableelectricity generation and electrifying energy demand, especially for transport. Policies focus on
maintaining affordable access to energy with the double aim of protecting vulnerable consumers
and ensuring industrial competitiveness.
Belgium has made notable progress on deploying offshore wind and increasing the share ofelectric vehicles. However, fossil fuels still dominate the country’s energy mix, a dependence thatis expected to increase. All sectors have considerable work ahead of them to meet Belgium’s
targets for increasing the share of renewables, lowering energy demand and reducing emissions.
The IEA provides a range of energy policy recommendations in this report to help Belgium
smoothly manage the transition to an efficient and flexible carbon-neutral energy system.