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

The existing practice

In existing practice, one often sees that a developer of new/renovated real estate issues a call for tenders to various operators of heat/cold systems, to make an offer for the project to be realized to build and operate a system of heat and cold supply at their own expense and risk. This often involves the use of heat/cold storage systems (CHP) and/or pumps. If several buildings are involved, networks are also constructed to supply the buildings with heat and cold from central facilities. At present, new or renovated developments are structured in such a way that the ultimate stakeholders in the buildings to be supplied with heat and cold (such as investors, housing corporations and tenants/private owners) actually have an influence on the performance of the heat/cold system, and can intervene if that does not go well. Nevertheless, the Minister assumes that in practice no adequate protection is provided for the consumers of heat and cold. That is therefore also one of the drivers behind the Wcw. In that context, government ownership is now being directed to ensure that customers are protected against the loss of the supply of heat and cold.

The WCW and our expectation in doing so

It is planned that with respect to heat lots, heat companies will be designated that - with respect to the infrastructure - are at least 50% held by the government. As we now understand it, the generation facilities and the actual supply need not be brought under them. However, that seems to be the obvious choice: if a heat network were to be held by one party and the generation facilities and/or supply by others, it becomes a complex set of rights and obligations. After all, how do you deal with unavailability of a network (failure/damage), or vice versa: the lack of generation facilities? And what do you do if a generator structurally lags behind in the sustainable performance prescribed by the Wcw or otherwise? And: who does and does not allow access to a network? Is this perhaps a matter of scarce rights? This is quite apart from technical issues about capacity allocation, temperature differences (and losses) and the like.

It is certain that the ownership of the infrastructure will be in the hands of the heat company. This removes the system of participation by customers and owners as is currently the case. The structure will therefore have to be different. We expect a structure in which one or more "private" parties and one or more "public" parties will enter into a partnership and subsequently make operating agreements within the partnership to implement a joint heat company. That this is going to demand a lot from the government - quite apart from the various roles and tasks given to the municipality under the Wcw - is clear. We can therefore imagine that various municipalities (and other authorities) are currently wrestling with the question of how they will interpret these roles and how they can continue to involve citizens in the development of heat networks (and not destroy the existing participation). It goes without saying that we are happy to participate in this challenging process!

Read our earlier blog here: The Collective Heat Supply Act, a cold shower for operators of collective heat systems.