City heating schemes on ice in dispute about ownership


Some 90% of new plans to connect new homes to city heating systems are currently on ice, because of differences between commercial companies and the government about who owns the networks, according to current affairs show Nieuwsuur.

City and district heating schemes use surplus heat generated by industry or from burning waste, and are seen as an important part of the transition to cleaner energy. The cabinet wants to double the number of households connected to a city heating scheme to one million in the coming seven years.

The dispute centres on government plans to put the infrastructure into public control.  Some 90% of the country’s district heating networks are in private handsSwedish-government owned Vattenfall, Eneco, which is part of Mitsubishi and Ennatuurlijk dominate the market.

Eneco director Ron Wit told Nieuwsuur that if the networks are in public hands, the investment risks are too high and it would be irresponsible to invest. 

“If we continue to put money in, and don’t know if we will get back our investment, then we can no longer get capital from our shareholders,” he said.

The legislation has not been finalised and energy firms, Wit said, face too many uncertainties about issues such as compensation and whether or not they would earn back their investments. 

However, climate minister Rob Jetten said that he does not intend to change his plans. “It is a fundamental choice to go for a public sector majority interest, and that is the way it works successfully across Europe,” he said. 

In current legislation, the cost of city heating is allowed to rise in line with gas prices, even though the homes are gas-free. In addition, tenants and home owners have no choice about which company to use. Local councils, therefore, are keen to have control of networks because they are effectively monopolies. 

In both Rotterdam and Amsterdam city heating providers have come under fire because of soaring costs to tenants and some housing corporations have halted projects to switch. The energy firms say this is due to the increased costs they face via subcontractors, staffing and equipment.

Two years ago, Jetten said he was looking into partially privatising city heating firms and delink the cost of city heating from gas prices.

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