Vattenfall will stop installing heating networks in existing neighbourhoods. According to the energy company, the reason is “deteriorating market conditions,” which means that “attractive prices” cannot be offered to customers in existing homes. The municipality describes Vattenfall’s decision as “very disappointing.”
Vattenfall’s goal was actually to connect 7,000 to 15,000 homes to the heating network each year, but due to market changes, this is no longer possible, according to the energy company. The company states that it is not possible to make a suitable offer to residents of existing buildings without Vattenfall becoming “financially unhealthy”.
According to the energy company, this is an uncertain period for heat suppliers. This is due, they say, to the sharp drop in demand for heat and the sharp rise in costs, but also to the emergency law that has put limits on interest rates. In addition, they are also critical of a potential law that would require the heating networks to be placed in the hands of the public sector. “This leads to more uncertainty and greater financial risks. All of this leads to a significant deterioration in our prospects,” said Ahmed Abdelsalam, Vattenfall’s director of heat.
Energy supplier Eneco also announced at the end of June that it would no longer supply heating and cooling in part of the east of the country. According to the company, this would be too expensive. This concerns parts of the Weespertrekvaart Midden/Oost, the third phase of the Amstelkwartier and the Kauwgomballenkwartier. It is not yet clear whether the municipality will continue with another party, but the municipality will recover all damages from the energy supplier.
Vattenfall wants to continue discussions
The company said it wanted to continue discussions with municipalities and the climate minister on heat transfer. Vattenfall still believes that heating networks are the most economical alternative to natural gas, rather than a heat pump in every home. “If we in the Netherlands want to use district heating to move away from gas, it is necessary to find a structural solution in terms of affordability, in cooperation with the government and all other partners.” Vattenfall still wants to continue investing in new housing areas.
In Amsterdam, there was also the intention to connect hundreds of thousands of homes to the heating network, but these plans have been on hold since March. Negotiations between the municipality, housing associations and Vattenfall broke down after it became known that social tenants were suddenly paying hundreds of euros more in fixed charges. While they had been promised that they would not be more expensive than gas. This makes the municipality’s goal of making the city gas-free by 2040 seem unattainable.
Interim councillor Dirk De Jager (Sustainability) described it as “very disappointing” that Vattenfall has stopped construction. “A painful result of years of delays and lack of structural solutions by the government. I therefore want to speak to the new minister as soon as possible. Because especially in this inevitable energy transition, residents must be able to rely on sustainable and affordable alternatives to heat their homes.”