Energy divide: Addressing the vulnerability of energy consumers in the Netherlands

In the shift to a climate-neutral society and economy, an essential solution for renewable energy is decentralized energy system relying on more distributed generation, energy storage, and more active involvement of consumers. In the European Union (EU), the Clean Energy Package puts consumers at the center of EU energy policy and introduces a wide range of initiatives to engage consumers in the transition to clean energy. In addition to implementing EU policies, EU Member States are also developing and implementing ambitious laws and policies related to the energy transition and climate change. For example, theNetherlands, which serves as a case study in this article, committed in the Rutte IV coalition agreement to emit less than 55% CO2 compared to 1990 by 2030 and to be completely climate neutral by 2050. The country aims to switch to renewable energy sources such as wind and solar power and develop a robust and flexible energy infrastructure system that can be operated on a smaller scale and decentralized. Such transformations have profound implications for understanding the role of the consumer in the Dutch energy market and highlight the need for greater consumer involvement in the connection, transmission, delivery, and use of energy.

This article aims to answer the overarching question of how the principles of good governance (transparency, effectiveness, accountability, and participation) can contribute to better protecting (vulnerable) consumers from governance vulnerabilities to ensure a just and smart energy transition. It focuses on the consumer protection approach introduced in the proposal for the new Energy Act (2023) in the Netherlands. The article examines to what extent the principles of good governance are effectively incorporated and elaborated in the Dutch legal framework for the protection of energy consumers. Ultimately, it seeks to provide recommendations on how to improve support for vulnerable consumers in the Netherlands and empower them to actively participate in energy markets and make informed choices. Although the article focuses primarily on the Dutch experience, it can offer valuable lessons and guidance to other countries that must deal with the challenges and opportunities associated with the transition to renewable energy sources and a more digitized energy market.