The built environment off the gas - state of affairs Municipal Instruments Heat Transition Act

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Designation power

The Wgiw allows municipalities to designate existing neighborhoods that must switch to a sustainable alternative to natural gas by a certain date (earlier than December 31, 2049) through local rules in their environmental plans by setting a custom rule. Supply of natural gas within those districts by network operators will then eventually be prohibited. This instrument is referred to under the Wgiw as the "power of designation. For municipalities, this therefore offers an opportunity to manage the sustainability of the built environment in a district-specific way and thus accelerate the heat transition.

To that extent, the Wgiw also plays an important role in the objectives of the Collective Heat Supply Act ("Wcw"), namely to promote the heat transition in the built environment. A neighborhood-oriented approach also contributes to a more (cost-)efficient transition to sustainable alternatives, such as a heat network. This prevents the need to maintain the gas grid for only a few users, resulting in high costs.

Decision on municipal instruments heat transition

With regard to the power of designation, instructional rules have been set at the AMvB level, among other things. For example, the Municipal Instruments Heat Transition Decree ("Bgiw") amends the Building Projects in the Living Environment Decree ("Bbl"), the Quality of the Living Environment Decree ("Bkl") and the Environment Decree ("Ob"). The customization authority, requiring buildings to be off gas sooner, is proposed in a new Section 3.107c of the Bbl.

The Bgiw has yet to pass the Lower and Upper Houses, but the Bgiw is also expected to enter into force on Jan. 1, 2026.

Requirements and safeguards power of designation

The Bgiw provides for instruction rules in the Bkl with requirements that (the substantiation of) the environmental plan must meet as a minimum. For example, further details are given to the power of designation and rules are set about monitoring the rollout of alternative sustainable energy supply.

It is further stipulated that there must be a reasonable period between the designation of an area and the transition to the renewable heat source. The guideline is a period of 8 years. This period can also be shorter or longer depending on the nature of the buildings or the designated energy infrastructure. If necessary, the term chosen can also be changed later (in response to the results of monitoring). In addition, factors to be taken into account include:

- The feasibility (including the availability of labor and materials) of the plan.

- The expected affordability of the measures.

- The total social cost of implementing the proposed energy infrastructure.

Mandatory heat program

The municipality can only designate areas included in a heat program (previously called: transition vision heat). The heat program becomes a mandatory program with the amendment of Article 3.6(3) of the Environment Act provided for in the Wgiw. This program binds only the municipality itself.

Under the proposed Article 4.25a Bkl, the heat program identifies, among other things, neighborhoods that the municipality wants to make more sustainable over a certain period of time, provides an estimate of the expected average heat demand of buildings within these neighborhoods and which buildings need to be insulated. It also weighs the sustainable alternatives being considered. If a location has not (yet) been explicitly designated in a heat program as a location that must become natural gas-free within the period covered by the heat program, the municipality cannot set customization rules about it in the environmental plan.

The Bgiw seeks to enshrine in article 10.16a of the Ob that a heat program must be established by municipalities by December 31, 2026. This must then be updated every 5 years (until December 31, 2049).

Implementation Plan

The municipality can then elaborate on the heat program (without obligation) in an implementation plan. In it, the municipality can describe (in more detail) what steps the municipality will take in the district in question and what support the municipality will provide to ensure that homes and buildings are connected to a sustainable alternative before the decision to discontinue natural gas is implemented. The implementation plan can be used in justifying the environmental plan.

Opt-out

Building owners who fall within the designated area are not required to connect to the collective alternative to natural gas. They can use a so-called "opt-out" option. A condition for this is that these building owners must arrange an equivalent alternative themselves, which is at least as sustainable (equivalent) in terms of energy performance as the collective alternative to natural gas chosen by the municipality. This must also be included in the environmental plan under the instruction rule proposed with the Bgiw in Article 5.131b of the Bkl.

The municipality can request information from the future heat company about which building owners have opted out. In fact, the draft WCw regulates that the heat company will make an offer to building owners to switch to a heat network.

In conclusion

Our website has previously published a series of blogs on the bill for the WCW:

-Collective heat supply law: expansion of an existing heat plot

-Collective Heat Supply Act: transitional law on existing heat systems

-The Collective Heat Supply Act: from citizen participation to government control?

-Collective heat supply law: the designation procedure, to tender or not?

-Collective heat supply law: the route to a collective heat system

-The Collective Heat Supply Act: a cold shower for operators of collective renewable energy systems?

-The Heat Transition and the Collective Heat Supply Bill: what lies ahead for the Netherlands?

Do you have questions about the Wgiw and/or the Wcw and what the implications are for your municipality, company or situation? The specialists of Straatman Koster advocaten are ready to assist you.