The Netherlands to introduce mass energy-support package

The Netherlands to introduce mass energy-support package
Dutch Prime Minister Mark Rutte (left) and Belgian Prime Minister Alexander De Croo. Credit: Belga/Pool Philip Reynaers

The Dutch Government is set to announce measures to temper the extreme energy bills of households in the Netherlands, local media reports.

Exact details for energy support have yet to be officially announced but the big picture is already clear: the government is digging deep into its pockets to ease the energy bills of citizens and households.

The primary measure is said to be a basic energy package which will cover consumption of up to 2,500 kWh of electricity and 1,169 m³ of gas (the average consumption of a Dutch family). Up to this usage, households will only have to pay for the gas used at prices from January this year with the government paying the excess. Any energy that households use above this will be charged at the current market price.

Additionally, energy companies will not be allowed to cut off the gas or electricity for households with payment problems this winter. Those who cannot pay their bills will have an extra six months to resolve the issue.

The government also wants to give people more stability with their energy costs and urges suppliers to offer more permanent, long-term contracts. In exchange, the severance payments will be significantly increased.

A different approach to Belgium

The Dutch measures – which are expected to be officially confirmed in the near future – are very different from those announced by the Belgian Federal Government.

Whereas in Belgium financial support is mainly based on income (energy bills are tempered for households below a certain taxable annual income), in the Netherlands it is based on consumption – meaning that those consuming less energy will effectively be rewarded by paying a normal price.

The Netherlands, however, there is no social tariff: an advantageous energy tariff in Belgium that protects the most vulnerable households. Instead, the Dutch have recently decided to increase the (one-off) energy allowance for the lowest incomes to €1,300.

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Gas prices in the Netherlands are among the highest in Europe: last month, they were twice as high as in Belgium. This is due to the high demand for gas in the Netherlands along with very high taxes on gas. With limited consumer protections up until now, households have suffered from the volatile gas market.

Nonetheless, the Netherlands has natural gas reserves that Belgium does not, granting the country a degree of energy sovereignty.

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