Following an episode of the Dutch consumer program Radar, aired on February 6, 2021, the Netherlands Authority for Consumers and Markets (ACM) has held conversations with residents who, in that episode, had complained about their heat suppliers.
The through line in all of the complaints
Virtually all of these conversations were about Thermal Energy Storage (TES) projects plagued by technical problems. TES systems are a type of underground storage of sustainable energy. More specifically, these conversations were about somewhat older TES systems that were built years ago, but whose teething problems have still not been fixed. To this day, the residents continue to be inconvenienced by it, whereas we are talking about a basic need here, the supply of energy. Residents worry almost every day whether they will be able to take a hot shower, and whether they need to wear an extra sweater. The main message of the residents was: please make sure that the heat system functions properly. With regard to ACM’s role in this situation, the residents said: ‘be proactive, and make sure that our voices are heard, including among lawmakers, and in the legislature’.
Numerous outages and high costs
One category of complaints concerned the numerous outages. The Dutch Heat Act does stipulate that suppliers must pay compensations in case of outages. They must do so if the supply of heat completely stops. A heat supplier must register outages, and must pay compensations for outages of more than 8 hours. If the quality of heat is poor, suppliers must make arrangements about compensation schemes with individual residents. However, according to the residents, this does not offer them enough protection. They said that heat suppliers do not always register the outages properly, and that the residents themselves are not able to prove that an outage had occurred. As a result, they are not compensated for the interruption of the heat supply. In addition, they said that heat suppliers have not paid any compensations for the poor quality of heat. ACM notes that it does acknowledge that an outage of less than 8 hours is also a nuisance, even though there is no compensation for such outages. The choice for 8 hours has been made by the legislature. Finally, the residents said that they are not satisfied with the rates that the heat suppliers charge. They feel they are doing their part in the realization of the energy transition with a sustainable supply of heat, but still feel they have to pay quite a lot, particularly since the systems are still facing all kinds of problems.
What is next?
ACM is currently still in the middle of holding follow-up conversations with residents. In many cases, holding one conversation was not enough. With these conversations, ACM has obtained a better understanding of the seriousness of the problems. ACM is currently looking into what problems it can and cannot tackle. Some of the choices have been laid down in laws, such as that 8-hour rule for outages, or the way in which tariffs are regulated. ACM is not able to change those things.
Right now, ACM sees several follow-up steps for the very near future:
- The most important thing for residents is that the systems start working properly. ACM will check what plans of action the heat suppliers currently have for improving the situation. ACM wants to know what concrete plans the heat suppliers have, the timeframe within which the problems can be solved, and how suppliers will involve the residents in those plans. The teething problems really need to be fixed, and the suppliers must work on and ensure a secure supply of heat.
- ACM had already started ordering suppliers to ensure that their outage registration systems are in order. ACM had planned to check again during this period whether heat suppliers have their outage registration systems in order. In that process, ACM will pay extra attention to the question of whether suppliers have set up their compensation procedures properly.
- Last year, ACM already ordered suppliers to make their invoices more transparent. ACM will start a follow-up check soon. If the invoices are still not sufficiently transparent after repeated reminders, ACM will not hesitate to take enforcement action.
- ACM keeps a constant watch on the actions of suppliers, for example, by tracking the financial positions of suppliers. Considering the various reports, among other reasons, ACM will intensify its conversations with suppliers in order to solve any problems swiftly.