The government of the Netherlands on June 9 announced it will temporarily cease issuing new subsidies for wood biomass-fueled low-temperature heating projects until a phase-out plan is established. The government said the action will not impact currently approved subsidies.

The announcement, issued by the Netherlands Ministry of Economic Affairs and Climate, also discussed the cost of decarbonation, noting biomass is one of the cheapest energy resources for heating applications.

According to the government announcement, phasing out the use of biomass before 2030 would result in significant increases to heating costs. If biomass subsidies for heat were stopped right now, expenditures for heating could increase by EUR 2.7 billion ($3.27 billion). The closer to 2030 the subsidies are phased out, the lower the associated costs will be, the government said.