The energy transition is entering its second phase. The Netherlands is not yet keeping pace.
For a decade, the European energy transition has been a story of growth. More wind. More solar. More gigawatts. That story worked: renewable capacity is now a substantial share of generation across most Western European grids.
But its success has exposed the next problem. When the wind blows hard and the sun is overhead, prices go negative and curtailment kicks in. On still winter evenings, the same system tips into scarcity and the marginal molecule of gas sets the price for everyone. In the Netherlands, grid congestion is no longer a peripheral concern — businesses now wait years for a connection, and the country faces the prospect of billion-euro EU fines for missing its renewable targets.
The reflex answer — build more wind and solar — is the answer to the last phase of the transition. The countries pulling ahead are already focused on the next one: building an energy system that is not only larger and cleaner, but stable, balanced, and resilient.
The international term of art for what is missing is “firm renewables” — clean energy sources that deliver predictable, continuous power. And among them, one category remains strikingly under-deployed in the country best positioned to build it: energy from water.
Why this matters to Aquius. Energy from water sits directly inside our third investment pillar — the water–energy nexus and blue energy. We do not invest below TRL 7+, so most of what we describe below is not yet investable for us today. That is precisely why we are following it carefully: this is the category where Dutch engineering depth, EU policy pressure, and grid economics are converging into what we believe will be the next investable wave of firm renewables.
What “energy from water” actually means
Energy from water is not one technology.
It is a family of complementary technologies, each at a different stage of readiness, that share a defining feature absent from wind and solar: predictability.
Tidal stream energy. Vertical-axis turbines integrated into existing infrastructure — storm-surge barriers, sluice gates, lock bypasses. Output follows lunar cycles and is therefore predictable to the hour, decades ahead. Dutch developers operate fish-safe designs at TRL 6–7 today.
Wave energy. Offshore converters that frequently peak precisely when solar drops off — at dusk, in winter, during storms. Modern designs target 35–40% capacity factors, with modular scalability that allows shared cabling and balance-of-system economics with offshore wind. Most credible designs sit between TRL 5 and 7.
Salinity gradient power (Blue Energy / Reverse Electrodialysis). Electricity generated from the mixing of fresh and salt water at river mouths and pumping stations. It runs continuously — 365 days, 24 hours — without chemical additives, and is compatible with ecologically sensitive areas. Dutch theoretical potential alone is roughly 1,750 MW of firm capacity. Pilot operations are running; commercial-scale deployment is the next step.
Offshore energy storage. Isothermal compressed-air systems integrated within offshore wind farms, using seawater as a heat sink. Cost is increasingly competitive with lithium-ion at €200–€300/kWh — with environmental and spatial advantages, and crucially, no dependence on critical raw materials.
Pumped and hybrid hydro storage. The oldest and most proven form of grid-scale storage — already firmly investable at TRL 9 — with renewed relevance through bidirectional turbines and integration with delta infrastructure.
Each technology has its own profile, but together they answer the question wind and solar alone cannot: where does firm, low-carbon, domestically produced power come from when the variable sources are not generating?
How we read investability in this category
Aquius invests at the intersection of mature engineering, scalable industrial opportunity, and policy unlock. For a sector to clear our gate, three conditions have to hold simultaneously. Today, in energy from water, two of the three are clearly in place. The third is moving — but not yet there for most sub-segments.
1. System value is finally being priced — in our favour
For years, renewables were ranked on a single metric: levelised cost of energy (LCoE). That metric flatters technologies that are cheap behind the fence but expensive at system level — they require backup, storage, balancing services, and grid reinforcement. As congestion costs and balancing-market premia grow, the system value of firm renewables — what they avoid in network and balancing spend — is becoming visible in regulator filings and tender criteria across Europe. Energy from water sits squarely on the right side of that revaluation. This is structural and we expect it to hold.
2. Technology is approaching, but mostly not yet at, our investment floor
Our investment criterion is TRL 7+ with commercial traction. Most projects in this sector still sit at TRL 5–7 — closer than the public conversation assumes, but not uniformly across our floor. Water2Energy operates a pilot turbine at the port of Vlissingen. REDstack has verified Blue Energy in real live conditions on the Afsluitdijk and is expanding into Spain and Italy. Dutch Wave Power has a TRL 6 prototype scheduled for the offshore test site near The Hague. FLASC is deploying its first onshore pilot of offshore-storage technology in Rotterdam with EIC Accelerator support. The cost trajectories are credible: salinity gradient power starts around €0.12/kWh and is projected to reach €0.05–0.07/kWh at deployment scale — fully competitive with offshore wind once system value is included.
We are tracking each of these companies and their peers closely. The question is not whether they reach our threshold but which ones do, when, and on what commercial terms. When they cross it — demonstrated by reference deployments with utilities, ports or grid operators and with a pipeline of potential orders for follow up projects — we expect to be among the first specialist water investors in a position to act.
3. Capacity factor changes the math — once the gate opens
A continuous baseload source produces roughly four times the annual energy output of a wind park with identical installed capacity. That reshapes cost-per-MWh and grid-utilisation analysis — particularly for industrial offtake, hydrogen production, and infrastructure-anchored projects. It is also the reason a relatively small ticket from a specialist fund can compound disproportionately once a technology is past the engineering hurdle.
The honest position. Aquius is not deploying capital into pre-commercial water-energy ventures. We invest at TRL 7+ with proven commercial traction. What we are doing is building the conviction, the ecosystem relationships and the policy groundwork now — so that when individual technologies cross our threshold, we move quickly and from a position of insight rather than discovery.
The Dutch paradox — and why we are leaning in
For a country that has built its identity, economy and physical existence around water management, the Netherlands’ under-deployment of water-based energy is almost surreal. Dutch firms hold deep expertise in offshore engineering, maritime construction, hydrodynamics and dredging. The North Sea and the delta system offer some of the highest-quality deployment sites in the world. The country’s storm-surge barriers, lock systems, pumping stations and estuaries are essentially purpose-built infrastructure for multi-use energy applications.
And yet projects are stuck. The Flakkeese Spuisluis tidal demonstration was delayed three years on permitting alone, despite the financing being in place and positive ecological validation. The new pumping station at the Noordzeesluis could be designed as a power-generating asset using salinity-gradient technology — but there is no institutional mandate at Rijkswaterstaat to make that choice. Subsidy frameworks (SDE++) reward only fully commercial (TRL 9) generation, leaving a structural funding gap precisely where most of the sector currently sits.
The barriers are not engineering. The roundtable Aquius co-hosted in The Hague in February 2026 with the Netherlands Water Partnership (NWP) and the Dutch Energy from Water Association (EWA) brought this into focus: developers, financiers and specialists agreed that the technology is ready or close to ready, the system need is acute, and capital is available. What is missing is a coordinated policy response.
Tidal energy — the Netherlands has the infrastructure others are still building
Tidal energy is the longest-proven form of marine power, with more than half a century of grid-connected operating history. The world’s first tidal power station opened at La Rance in Brittany in 1966, inaugurated by President Charles de Gaulle. Its 240 MW barrage across the Rance estuary was a purpose-built piece of civil engineering — a kilometre of concrete dam erected specifically to harvest the tidal range — and it has run continuously ever since, supplying enough power for roughly 225,000 French households on an output profile that has barely degraded after six decades. La Rance answered the first-order question about tidal at the time it was built: does it work, is it durable, does it sit comfortably inside a national grid? The answer to all three was yes.
For more than four decades La Rance remained the world’s only large-scale tidal plant. That changed in 2011 when South Korea commissioned the Sihwa Lake Tidal Power Station — a 254 MW facility integrated into the seawall of an existing artificial lake near Incheon, edging past La Rance as the world’s largest. Sihwa demonstrated something equally important: when a usable piece of marine civil infrastructure already exists, the marginal cost of turning it into a power station is a fraction of building one from scratch. The Korean turbines were retrofitted into a barrier that had originally been built for water management, not for energy.
The United Kingdom has been working on similar logic for two decades. A succession of tidal lagoon and barrage proposals — the Severn Barrage, Swansea Bay Tidal Lagoon, more recently the Mersey Tidal Power scheme — has carried the same headline number: gigawatt-scale, multi-decade firm renewable supply. But each scheme has run into the same hard problem: the lagoon or barrage itself must be built first, at multi-billion-pound capital cost and with a permitting horizon measured in decades. The technology is not the obstacle; the civil engineering is.
This is where the Dutch position is unique — and uniquely under-used. The Delta Works programme, executed in response to the 1953 North Sea flood, gave Zeeland and South Holland a network of storm-surge barriers, dams and sluice complexes that are, in marine-engineering terms, the most expensive infrastructure to build and the cheapest to retrofit. The Oosterscheldekering, the Brouwersdam, the Grevelingendam, the Bathse and Flakkeese sluices and a series of smaller spui-structures already span the highest tidal-energy resource in north-western Europe. They were built for flood defence, not for power. But the openings through which water moves in and out twice a day are precisely the locations where modern fish-safe tidal turbines belong.
The technology to put turbines in those locations is operationally ready. Water2Energy — the Dutch tidal developer most embedded in the Zeeland infrastructure — has had its WaterLion vertical-axis turbine grid-connected at Vlissingen since 2021, with fish friendlyness independently validated (against roughly 20% harm rate for the Kaplan-style designs that dominated earlier installations). Its next-generation D150 is in fabrication for the Flakkeese Spuisluis under the Offshore-for-Sure Interreg programme; the larger D500 platform, designed for the storm-surge-barrier pier openings themselves, is moving through engineering toward 2027–2029 deployment. These are not laboratory devices — they are scaled iterations of a machine that has been running in Dutch water for fifteen years, with a foundational patent lineage stretching back to 1999 and continuous deployment experience across the Lek, the Scheldt, Antwerp, Cameroon and Vlissingen.
Independent technical analysis prepared for Water2Energy puts the Zeeland Delta’s tidal-energy potential at 65–107 MW of installed capacity, generating 198–314 GWh per year. The Oosterscheldekering alone accounts for 20–35 MW (70–95 GWh/year); the Brouwersdam adds another 15–25 MW (50–75 GWh/year); the Grevelingendam — which is in any case scheduled for renovation under the Grevelingen restoration plan — adds a further 10–15 MW. In household terms that is 70,000–110,000 Dutch homes powered annually — between a third and just under half of Zeeland’s entire electricity consumption, delivered from a generating profile that is forecastable to the hour, decades ahead, and immune to weather.
The build-out timeline is not measured in decades. The barriers exist. The turbines exist. The permitting framework, once unblocked, is the binding constraint — not the engineering. With a coordinated mandate to Rijkswaterstaat and a financing track sized for the gap between innovation grants and full SDE++, a meaningful share of that 65–107 MW could be installed and generating inside the second half of this decade. The same question that took the United Kingdom forty years of barrage and lagoon debate, and South Korea a major piece of new construction, the Netherlands could answer by retrofitting infrastructure that has already been paid for, built and operated for the better part of two generations.
What the policy unlock looks like
Together with NWP and EWA, we have argued in our parliamentary policy brief and our recent press piece for five concrete measures that would convert latent capability into deployed capacity:
- A dedicated CfD or feed-in-tariff track for energy from water, with starting tariffs around €0.12/kWh and a degression path toward €0.05–0.07/kWh, over 15–20 year contracts. This mirrors what unlocked offshore wind in the UK — the single most consequential lever available.
- Fast-track permitting for pilots up to 5 MW, with standardised ecological protocols, a one-year maximum decision window, and a single coordination desk across ministries — aligned with the EU Net-Zero Industry Act.
- A TRL 4–7 bridge-financing instrument combining grants, guarantees and risk insurance, sized to span the valley of death between innovation budgets and large-scale exploitation regimes. This is the instrument most likely to move technologies into our investment range.
- Explicit recognition of system value in market design — pricing in avoided balancing costs, stable-supply premia, and incentives for storage integration in offshore wind tenders.
- A National Roadmap to 2035, with priority sites (Zeeland, Rotterdam estuary, Scheveningen, Noordzeekanaal, Waddenzee), capacity targets per technology, and explicit linkage to export and industrial policy.
These are not exotic asks. They are variations on instruments the Netherlands has already used successfully for offshore wind, geothermal and hydrogen. The opportunity is to apply them, deliberately and quickly, to the next generation of renewables before deployment leadership — and the industrial value — migrates to the UK, France or further afield.
What we are watching, and the signals that would move us
We hold a live watchlist across each sub-segment and update it against the Aquius investment framework. The specific signals that would move a venture from “monitor” to “active diligence” are concrete:
- Reference deployment with a Tier-1 utility, port authority, or grid operator under a multi-year offtake or service contract.
- Commercial unit economics demonstrated on operating assets — not modelled — within striking distance of the SDE++ ceiling or its successor instrument.
- Clear regulatory path — ideally a dedicated CfD or analogous mechanism — sufficient to underwrite the first commercial cohort.
- Defensible IP and a credible scale partner (engineering EPC, infrastructure investor, or strategic acquirer) already engaged on the next phase.
- Ecological and permitting validation portable across multiple jurisdictions, materially reducing single-site risk.
Several portfolio candidates in our pipeline of 71 actively screened EEA ventures sit within one or two of these gates. None today clear all five. We expect that to change inside our deployment window.
Why we are paying attention now
At Aquius, our conviction is that the most asymmetric opportunities in energy-transition capital sit where three forces meet: a real system need, a technology past the engineering hurdle, and a policy environment on the cusp of moving. Energy from water is exactly that intersection — and exactly the kind of category where being early in conviction, ecosystem and relationships matters more than being early in capital.
The Netherlands has a narrow, time-limited window to convert its water-management leadership into industrial leadership in the next wave of renewables. A coordinated policy response within the next 12–24 months will decide whether the country becomes a deployment hub for firm marine renewables — or remains, once again, an exporter of know-how that scales somewhere else.
We are putting our work, our convening power and — when the gate opens — our capital behind closing that gap. Energy from water deserves a serious place in the Dutch and European energy mix. Not as a niche curiosity, but as a system-critical pillar of the firm-renewables build-out.
What comes next — second Expert Roundtable, 15 June 2026
Together with the Netherlands Water Partnership (NWP), the Dutch Energy from Water Association (EWA) and the Province of Zuid-Holland, Aquius is convening the second Expert Roundtable on Energy from Water on 15 June 2026, hosted by the Province of Zuid-Holland. The session builds directly on the February 2026 roundtable in The Hague and on the conversations we have had since with policymakers, Members of Parliament and provincial leadership.
The agenda is organised around three threads that translate the policy unlock described above into concrete next steps:
- Budget and financing. Closing the scale-up gap between the innovation tracks (DEI+/MOOI) and the SDE++ exploitation regime, including a proposed carve-out within SDE++ for system-cost-reducing innovations.
- Status of national interest. Anchoring energy from water formally in the National Strategy on Spatial Planning (NOVI), the North Sea Programme and the project-coordination route under the Environment and Planning Act.
- Demonstration space. Securing a clear mandate for the Ministry of Infrastructure and Water Management and Rijkswaterstaat to host pilots on Dutch infrastructure, with monitoring-based ecological frameworks rather than pre-emptive testing.
The roundtable feeds directly into the Dutch preparations for ICOE 2026 — the International Conference on Ocean Energy — which the Netherlands hosts in The Hague in October 2026, and into the joint position paper Energy from Water — Dutch Strategy 2026–2030 that EWA, NWP and the Province of Zuid-Holland will publish later this year.
The session is invitation-only and convened under Chatham House rules. Stakeholders working on energy-from-water policy, finance or deployment who would like to engage with the agenda are invited to get in touch ahead of the date.
