Go to content

Reduction obligation

Companies that deliver fuels to the transport sector in the Netherlands are obliged to reduce the greenhouse gas emissions from their fuels by 6%. This applies to reducing the life-cycle greenhouse gas emissions from extraction up to and including use for transport. Similar to the annual obligation, the reduction obligation is also expressed in HBEs.

Reference value

Greenhouse gas emissions must be reduced by 6% in relation to the European baseline value for 2010 of 94.1 g CO2 equivalents per megajoule (CO2-eq/MJ). This means that from 2020 onwards, the average greenhouse emissions from the company’s mix of fuels must amount to 88.45 grammes CO2-eq/MJ or less.

Output standard for 2010 94.1 gram CO2-eq/MJ
Reduction requirement (%) 6%
Objective 88.45 gram CO2-eq/MJ

Reduction obligation in HBEs

The reduction obligation applies to the energy content of fuel deliveries coming under the scope of the reduction obligation, i.e. taxed deliveries released for consumption in the transport sector (see below).

In order to express the level of the reduction obligation in HBEs:

  • The taxed deliveries released for consumption in the transport sector, as entered by the companies in litres, are converted to an amount of energy. This conversion takes place automatically in the REV, using the net calorific value of each fuel (taken from the Renewable Energy Directive).
  • For each fuel, the amount of energy is then multiplied by the standard emission factor for the relevant fuel (93.3 grammes of CO2eq/MJ for petrol and 95.1 grammes of CO2eq/MJ for diesel). The quantity of CO2 determined in this manner is the total ‘current’ emission for the relevant year.
  • This is compared with the maximum allowed emission, which is the total amount of energy multiplied by 88.45 g CO2-eq/MJ.
  • The difference represents the commitment to reduce emissions in kilograms of CO2-eq.

Companies can fulfil their reduction obligation using HBEs. This is because each HBE does not only represent 1 GJ of renewable energy but also a specific reduction of greenhouse gas emissions. This reduction per HBE is referred to as the HBE reduction contribution. Before 1 July of each year, the NEa determines the value of the HBE reduction contribution applicable the following year.

The HBE reduction contribution for 2023 is set at 44 kg of CO2-eq. per HBE.

According to the NEa’s calculations, this value means companies subject to:

  • the annual obligation
  • the reduction obligation
  • having the required number of HBEs

to meet their annual obligation for 2023, will automatically meet the reduction obligation for 2023.

The HBE reduction contribution for 2024 is set at 49 kg of CO2-eq. per HBE.

According to the NEa’s calculations, this value means companies subject to:

  • the annual obligation
  • the reduction obligation
  • having the required number of HBEs

to meet their annual obligation for 2024, will automatically meet the reduction obligation for 2024.

The required number of HBEs is the outcome of dividing the reduction obligation by the HBE reduction contribution. Similar to the annual obligation, the reduction obligation imposes a minimum share of HBE-G and maximum shares of HBE-C and HBE-B.

Better fossil fuels reduce the reduction commitment

Suppliers of petrol and diesel that also deliver so-called better fossil fuels to the Dutch transport sector – LNG, LPG or CNG – can use this to reduce their reduction obligation. This is because the greenhouse gas emissions of these fuels are lower than the reduction target of 88.45 g of CO2-eq/MJ. The emission reduction achieved when using these better fossil fuels compared to the reference value for petrol and diesel is subtracted from the reduction obligation. What this means is that better fossil fuels can be used as a type of deductible item. The emission reduction achieved in this way cannot be banked or traded.

Better fossil fuels must have been delivered by the company that is subject to the reduction obligation. When entering deliveries of fossil fuels, a company must be able to provide at least an invoice and a payment receipt as proof of the delivery.

Companies that exclusively deliver ‘better’ fossil fuels (LPG, LNG or CNG) are not subject to the reduction obligation. After all, it is assumed that these fuels have not been delivered to a transport customer subject to an obligation in the Netherlands. In addition, the greenhouse emissions from these fuels comply with the reduction target of 6% in relation to the baseline value for 2010.

The effect of entering a delivery of better fossil fuel is shown in the sample calculation at the bottom of this page.

Understanding the level of the obligations
From April 2023 onwards, companies can use the REV to gauge the level of the obligations for 2023. They can do this by entering the expected fuel deliveries for 2023 in the REV. Using the fuels entered, the mandatory percentages and limits related to the annual obligation and the HBE reduction contribution, the REV will calculate the number of HBEs required for both the annual obligation and the reduction obligation. This allows companies to see which of the two obligations will require the most effort.

Companies can obtain this information under ‘Indication of annual obligation / obligation to reduce emissions’ or ‘Home’ in the REV menu. Companies that do not have access to the REV yet, or wish to know the level of the obligations sooner can use this document (Dutch) to establish this. They can obtain an indication by filling in the expected fuel deliveries for 2023.

Documents