Flemish Solar Mandate for Large Electricity Consumers: Key Compliance Requirements

This article outlines the key aspects of the Flemish PV obligation for large electricity consumers. The article is structured into seven main sections: 1) Regulatory Framework, 2) Scope and Thresholds, 3) Compliance Deadlines and Capacity Requirements, 4) Implementation Options, 5) Exceptions and Deferrals, 6) Enforcement Mechanisms, and 7) Strategic Implementation Guidelines.

1. Regulatory Framework

The PV obligation forms an essential part of Flanders' broader energy transition strategy. Its primary aim is to stimulate local renewable energy production and enhance the region's energy independence. This obligation stems from the Decree of the Flemish Government containing general provisions on energy policy, commonly known as "the Energy Decree of 19 November 2010". The most recent amendments, such as those introduced by the Decree of the Flemish Government of 17 February 2023 (Article 3, effective: 24 June 2023), have further refined and detailed the specific provisions for this PV obligation. The regulation specifically targets large electricity consumers, intending to leverage their significant consumption profiles and available infrastructure for the large-scale implementation of renewable energy.

2. Scope and Thresholds

Entities and Obligated Parties Involved

The mandate applies to buildings with annual electricity consumption exceeding 1 GWh from 2021 onward. Responsibility lies with the owner, long leaseholder (erfpachter), or building right holder (opstalhouder). For properties with multiple such parties, all are jointly and severally liable for compliance.

Consumption Threshold

The obligation applies when annual electricity consumption exceeds 1 GWh (1,000 MWh) per calendar year, with 2021 as the initial reference year[1].

Exemptions from the Obligation

Buildings are exempt if their average electricity consumption over the three preceding calendar years is more than 10% below the 1 GWh threshold. However, this exemption is invalidated if there was zero electricity consumption in any of those three years, preventing temporary shutdowns from qualifying for exemption.

The exemption clause, based on a consumption reduction of more than 10% below 1 GWh, with the exclusion for zero consumption, indicates that the regulation targets genuinely large, continuous consumers. This implies that companies may consider strategic energy management to bring their consumption below the threshold and potentially avoid the obligation. However, such a reduction must be sustainable and not relate to a temporary dip or closure of a location. Companies should meticulously monitor their annual electricity consumption. A sustained reduction in energy demand, for example, through energy efficiency measures, could lead to an exemption. This, however, requires careful long-term planning and verification to ensure consistent compliance with the exemption conditions.

3. Compliance Deadlines and Required Capacity

Installation Deadlines

The Flemish PV obligation has specific deadlines for the commissioning of photovoltaic solar panels:

• Buildings exceeding 1 GWh in 2021/2022: Install PV by April 1, 2026; 
• Buildings exceeding 1 GWh from 2023 onward: Install PV by January 1 of the fourth calendar year after threshold exceedance;
• Deadlines for Building Changes:
  • Increased roof area (new buildings/expansions): Install PV by January 1 of the fourth calendar year after completion. The new horizontal roof area must be taken into account for capacity calculation; 
  • Demolition/reconstruction or roof replacement: Install PV considering new roof area.

Progressive Capacity Requirements

The regulation establishes a three-phase increase in minimum required capacity. Each phase requires full compliance with the higher requirements by the specified date.

The minimum peak power requirements are as follows:

• Phase 1 (by April 1, 2026): 12.5 Watt-peak per m² of horizontal roof area.
• Phase 2 (by January 1, 2030): 18.75 Watt-peak per m² of horizontal roof area.
• Phase 3 (by January 1, 2035): 25 Watt-peak per m² of horizontal roof area.

ACTION TIP: Don't plan for minimum compliance. The stepped increase from 12.5 to 25 Wp/m² requires a long-term investment strategy. Consider immediate installation at higher capacity or design systems with expansion capability. Integrate these requirements into your capital expenditure planning for 2026-2035.

Determining Required Capacity

Base calculation: Horizontal roof area × required Wp/m² (12.5, 18.75, or 25 Wp/m²)

However, the calculated peak power is subject to the following two caps: 

• Cap 1 - Consumption-based: Maximum required capacity = (Annual consumption in kWh × 35%) ÷ 900 full load hours, rounded up to whole kWp
  • Example: If 1.5 GWh (1,500,000 kWh) was consumed, the cap would be (0.35 * 1,500,000 kWh) / 900 full load hours = 583.33 kWp, rounded up to 584 kWp.
• Cap 2 - Grid capacity: Maximum required capacity = Maximum grid injection capacity ÷ 0.7, rounded up to whole kWp
  • Required: Up-to-date grid study from DSO/transmission operator submitted to VEKA.
  • Study must account for existing and planned renewable generation at site;
  • The maximum remaining connectable injection capacity resulting from the study is divided by 0.7 to determine the PV peak power to be installed, rounded up to a whole number.

The explicit inclusion of a cap based on the "maximum remaining connectable injection capacity" and the requirement for an "up-to-date grid study" reveal a crucial practical limitation: the capacity of the electricity grid to absorb injected renewable energy. This is not merely a theoretical calculation but a real bottleneck that can significantly affect the feasibility and scale of PV installations. The divisor of 0.7 implies a safety margin or efficiency factor applied by the regulator. Businesses must initiate grid studies early in their planning process. Grid capacity limitations can reduce the required PV installation size, but can also entail significant delays and costs if grid upgrades are necessary. This underscores the need for early engagement with Distribution System Operators.

4. Implementation Options

The Flemish PV obligation offers significant flexibility in how it can be met, with options for direct installation of PV systems, the deployment of alternative renewable energy technologies, or participation in projects.

Option 1: Direct Installation of PV Systems

PV panels can be installed in various locations:

• On building roofs.
• On building facades.
• On carports.
• On bicycle shelters.
• On land.
• As floating photovoltaic solar panels.
• As overarching photovoltaic solar panels within an agricultural area, provided that the potential effects of the siting on efficient land use, potential disruption of operational possibilities, and landscape qualities have been investigated as part of the permit application.

Eligible installation sites include:

• On buildings connected to the off-take point of the site where the obligated buildings are located.
• On the obligated party's own site where the obligated buildings are located.
• On a site other than those mentioned above, if the production installation supplies a direct line connected to the obligated off-take point.
• On another own site of the owner, long leaseholder, or building right holder in the Flemish Region.
• On a site in the Flemish Region belonging to an affiliated company of the owner, long leaseholder, or building right holder (as defined in Article 1:20 of the Companies and Associations Code).

An important nuance for installations on another own site or a site of an affiliated company is that only PV panels commissioned after 1 January 2023 are eligible to count towards the obligation. 

This is a strategic opportunity for large companies as they can leverage the flexibility in installation locations to optimize their compliance strategy. 

Option 2: Alternative Renewable Technologies

As an alternative to PV, other renewable technologies commissioned after January 1, 2023, can satisfy the obligation if installed at the same off-take point or an eligible site in Flanders.

Qualifying alternative technologies:

• A new wind turbine or a repowering of a wind turbine (where in the case of repowering, only the additional nominal capacity after repowering is considered).
• A new combined heat and power (CHP) installation burning biomass or biogas (excluding biomethane).
• A new heat pump (where only the renewable energy portion and the portion produced from waste heat of the heat production are considered).
• A new photovoltaic-thermal installation.
• A new concentrated solar thermal installation.

The deadlines for these alternative technologies are the same as the deadlines for the commissioning of PV panels. For the tightening pathway (2030, 2035), specific later deadlines apply if the initial PV deadline falls before these dates.

Equivalence calculation for alternative technologies:

• Wind turbine: Comparison between PV peak power (900 full load hours) and nominal capacity of a wind turbine (2610 full load hours).
• Combined Heat and Power (CHP) installation: Comparison between PV peak power (900 full load hours) and nominal capacity of a CHP installation (8150 full load hours).
• Heat pump (space heating), PV-thermal, concentrated solar thermal: An equivalent heat capacity equal to the nominal capacity of the solar panels to be installed.
• Heat pump (exclusively supplying process heat): An equivalent heat capacity equal to the nominal capacity of the solar panels to be installed multiplied by 0.167.

The Flemish Government will evaluate these alternative renewable energy technologies by 30 June 2025 at the latest.

Companies shall therefore conduct a comprehensive energy audit to determine if alternative technologies better suit their energy profile. They should also consider existing heat demands, available resources (wind conditions, biomass availability), and technical feasibility before selecting an alternative to PV. 

Option 3: Participation in External Renewable Projects

Organizations can fulfill the obligation by financially participating in new renewable energy projects in Flanders, either directly or through affiliated companies. The eligible projects are similar to the direct installation options, including PV (various locations), floating PV, overarching PV in agricultural areas, new wind turbines (or repowering), new biomass/biogas CHP, new heat pumps, PV-thermal, and concentrated solar thermal installations.

The participation agreement must be entered into by the deadline for commissioning photovoltaic solar panels, with specific later deadlines for the tightening pathway (2030, 2035). The projects must be located in the Flemish Region.

For PV projects, the required participation must be for at least the peak power that meets the requirements explained above. For other technologies, the participation must include at least a nominal capacity that generates an amount of electricity equivalent to the electricity production that would result from fulfilling the PV obligation.

Financial participation requirements:

• Before July 1, 2025: €800 per required kWp
• €750 per kWp for agreements entered into from 1 July 2025 onwards.
• €700 per kWp for agreements entered into after 1 January 2030. The full participation amount must be paid by the participant to the project implementer by the PV commissioning deadline at the latest. 

The new installation in which participation occurs must have been commissioned from 1 January 2023 and by the PV commissioning deadline at the latest. Specific later commissioning dates apply to projects that meet the tightening pathway. Peak power or nominal capacity of project installations placed to fulfil other obligations under this decree are not eligible to count towards this PV obligation.

Required participation agreement details for VEKA submission:

• Unique agreement number;
• Project identification;
• Full participation amount;
• Relevant off-take points;
• 15-year prohibition on alienation after commissioning;
• Peak, nominal, or equivalent capacity;
• Latest commissioning date;
• Sworn declaration that the installation doesn't fulfill other decree obligations. 

Project implementers must submit a comprehensive participant list with associated data to VEKA for each project.

5. Deferrals and Exceptions

The regulation provides mechanisms for temporary deferral or permanent exceptions under specific circumstances:

Temporary Deferral for Construction Works

Owners, building right holders, or long leaseholders can apply to VEKA for a deferral for buildings that will be fully or partially demolished and reconstructed, or whose roof will be fully or partially replaced. The application must demonstrate that one or more of these circumstances apply. VEKA must inform the applicant of its decision regarding the deferral request within sixty days of receiving the application. If granted, the deferral period is five years from the notification of the decision. Within this deferral period, specific requirements apply for submitting proof:

• Demolition for reconstruction: Planning permission for urban development acts related to demolition must be submitted to VEKA by three years after the notification of the deferral decision, provided a demolition permit is required.
• Roof replacement: A signed quotation for roof replacement must be submitted to VEKA by two years after the notification of the deferral decision.

An appeal to an administrative court regarding the planning permission for demolition suspends the aforementioned deadlines.

Permanent Exception for Building Demolition

In the event of a full or partial demolition of a building without reconstruction, the PV obligation does not apply to the portion of the roof area that is not reconstructed. The obligated party must notify VEKA of the demolition without reconstruction in such a case. As proof of demolition without reconstruction, the owner, long leaseholder, or building right holder must submit planning permission for urban development acts for the demolition to VEKA by three years after the planned demolition was reported to VEKA, provided a demolition permit is required.

The exception ceases to apply if:

• The planning permission for demolition is not submitted to VEKA within three years of the notification (if required).
• The building has not been demolished within five years of the exception taking effect.

An appeal to an administrative court regarding the planning permission for demolition suspends the aforementioned deadlines.

6. Enforcement and Non-Compliance Consequences

Role and Authority of VEKA

The Flemish Energy and Climate Agency (VEKA) is the designated authority for supervising and controlling compliance with the PV obligation. VEKA is authorised to request horizontal roof area data and other necessary information from owners, long leaseholders, building right holders of buildings, or from electricity consumers of those buildings. This data must be provided within sixty days of receiving the request. Furthermore, VEKA is the data controller for personal data processed under this regulation.

Penalties for Non-Compliance

VEKA imposes a fine of €400 per kilowatt-peak below the required capacity for installations not operational by the applicable deadline.

Important: These fines are non-absolutory - paying them does not eliminate the obligation. If non-compliance continues, additional fines can be imposed until full compliance is achieved. Accordingly, a non-compliance is not financially viable. The €400/kWp fine, combined with the persistent obligation, creates cumulative penalties that quickly exceed installation costs. For a 500 kWp shortfall, the initial fine alone would be €200,000, with potential for repeated penalties until compliance.

7. Strategic Implementation Guidelines

Early Planning and Strategy Development

Given the complex interplay of deadlines, capacity calculations, alternative pathways, and potential grid limitations, a proactive and holistic approach is essential. Businesses should conduct a thorough evaluation of their electricity consumption patterns, available horizontal roof area, structural integrity of buildings, and the potential for alternative technologies.

Financing and Operational Models

The regulation explicitly allows the obligation to be met through direct installation or participation in projects, offering flexibility in ownership and operational models. Businesses may consider Power Purchase Agreements (PPAs) with external PV developers or participate in joint ventures for renewable energy projects.

Technical and Legal Requirements

It is crucial to understand the precise definitions (e.g., horizontal roof area, affiliated company), deadlines, and the nuances of the equivalence calculations. The joint and several liability for multiple owners necessitates clear internal agreements. Technically, accurate measurements of horizontal roof area, assessment of structural capacity, detailed grid studies, and feasibility studies for alternative technologies are of paramount importance.

Conclusion

This report has provided a detailed examination of the Flemish PV obligation for large electricity consumers, outlining its scope, deadlines, capacity requirements, and various compliance pathways. The regulation is robust, with clear enforcement mechanisms and significant financial penalties for non-compliance, underscoring the importance of timely and accurate action.

While challenging, the Flemish PV obligation offers flexibility through multiple compliance pathways. Act now to assess your specific situation, develop a tailored strategy, and implement a cost-effective solution. Early planning is essential given the significant financial penalties for non-compliance and the potential competitive advantages of proactive renewable energy deployment. Consult specialized legal and technical advisors for site-specific guidance.

[1] However, for public buildings, specific, stricter thresholds apply, as indicated by supplementary information. Although the directly provided legal text (Arts. 6.7.2 - 6.7.5) primarily focuses on the general threshold of over 1 GWh, various external sources consistently highlight the lower thresholds for public buildings. For this category of buildings, the threshold is 250 MWh per year. From 2030, this threshold for public buildings will be further lowered to 100 MWh per year, based on consumption from 2026 onwards. This differentiation in the regulation points to a two-pronged strategy, where the Flemish Government imposes stricter requirements on its own entities or public actors.