SDE++

The SDE++ (The Sustainable Energy Production and Climate Transition Incentive Scheme) provides multi-year operating subsidies for certain climate investments. These are installations for large-scale renewable energy generation and/or CO₂ reduction. These must be projects of a certain size. Examples include projects with a large scale grid connection, special permits and a feasibility study for the plans.

There are five submission phases, which are opened on the basis of successive subsidy intensities. Applicants are primarily ranked on a first-come, first-served basis. On the day that the SDE++ budget is exhausted, successful applications are selected on the basis of their subsidy intensity.

Submission phases for the SDE++ tender 2025

The total budget for the 2025 tender is EUR 8 billion. This total budget comprises three sub-budgets of EUR 750 million, covering projects in three areas: low-temperature heat (LT), high-temperature heat (HT) and molecules.

Technologies classified in the three domains are eligible for the first draw from their sub-budget of EUR 750 million. If the sub-budget is exhausted and the project does not fall within the range of allocated subsidy intensities, it will automatically be added to the main tender (‘remaining budget’) and will compete again for the budget (amounting to EUR 5.75 billion) on the basis of subsidy intensity.

The decision on the choice of subsidy intensity and phase requires strategic insight, as the (sub)budget may be exhausted at some point. In this process, applicants are still maximized at a certain subsidy intensity based on their published category values.

Tip: PNO Innovation’s SDE++ Intelligence Report can help you determine a bidding strategy.

The SDE++ changes for 2025

The SDE++ scheme for 2025 has now been published. The scheme is open to most categories that were already eligible in 2024 (such as solar, wind, geothermal and aquathermal energy, electric boilers, hydrogen and CCS). New categories have also been added:

• Vertically mounted east-west orientation solar energy systems, which offer a favourable generation profile by producing electricity mainly in the morning and late afternoon hours, thereby reducing grid congestion around midday.
• In the field of carbon removal, Direct Air Capture (DAC) is eligible for the first time, particularly in applications where captured CO₂ is used directly on site by greenhouse operators to support the decarbonisation of horticulture.
• A new category has been opened for the production of hydrogen from the gasification of residual waste, under strict conditions that ensure that only non-recyclable waste streams are used.
• In response to a growing operational challenge, a new category is being introduced specifically for electric boilers that only require support for operational costs.

How much does the SDE++ subsidy yield?

The SDE++ reimburses the difference between the cost price of the sustainable energy or the CO₂ emissions to be reduced and the (potential) revenues. The subsidy is granted over a period of 12 or 15 years. The number of years you receive the subsidy depends on the technology you use. The amount of the subsidy depends on the technology used and the CO₂ reduction you ultimately achieve with it:

• Phase 1 – For projects with a subsidy intensity of up to EUR 75 per tonne of CO₂
• Phase 2 – For projects with a subsidy intensity of up to EUR 150 per tonne of CO₂
• Phase 3 – For projects with a subsidy intensity of up to EUR 225 per tonne of CO₂
• Phase 4 – For projects with a subsidy intensity of up to EUR 300 per tonne of CO₂
• Phase 5 – For projects with a subsidy intensity of up to EUR 400 per tonne of CO₂

An SDE++ application round consists of five phases. During the first phase, you can only apply for subsidies for projects with a subsidy requirement up to a certain subsidy amount per tonne of CO₂. During the subsequent phases, this maximum subsidy amount per tonne of CO₂ is gradually increased. You may also submit projects with a subsidy requirement lower than the maximum set for the technology in question. This encourages market parties to submit projects at a lower price, thereby increasing their chances of receiving a subsidy.