Notes #11/2024: Good governance in the energy transition is not about catering to the vox populi
Good governance in the energy transition is not about catering to the vox populi
Notes are just that: Short, informal messages, or brief records of points or ideas written down. The views and opinions expressed in my notes do not necessarily reflect the views or positions of my employer or clients.
Reflections on the programme of the new government
Nearly six months after the national elections in the Netherlands, four political parties have finally reached an outline agreement for a new coalition government. In notes #4/2024, I made predictions about the energy transition and sustainability policies of this coalition. These predictions were quite close to the now-released outline agreement. In this issue of notes, I reflect on the agreement and its implications for the energy transition.
Two Good Frames
The topic of energy transition in the ‘Outline Agreement between the factions of PVV, VVD, NSC, and BBB’ from May 16, 2024, is approached from two ‘frames.’ In the first frame, autonomy in energy supply is linked to fairness in the energy transition:
“For energy and supply security, the Netherlands is now too dependent on unreliable countries. The energy transition should aim at reducing existing and preventing new dependencies. It is crucial that this does not come at the expense of people with low incomes and small businesses (...)”
In the second frame, autonomy in energy production is linked to innovation and entrepreneurship:
“There is a focus on more energy independence and domestic sustainable energy production (...) By investing in sustainable energy sources and innovation, the Netherlands creates a favorable climate for entrepreneurship. This not only leads to a cleaner environment but also to economic growth and new business opportunities.”
From a communication and political standpoint, these are well-chosen frames. Climate and energy policy has long been dismissed as a 'left-wing hobby,' especially by the PVV, the now largest party, and the BBB, the smallest coalition partner. Even the VVD, previously the largest party and now the second, treated climate as a side issue until the Rutte IV government, insisting it remain 'feasible and affordable.' Frames like 'saving the planet' or 'caring for future generations' resonate less with the coalition parties' electorate. However, linking these issues to economic growth and security fits well. Innovation and entrepreneurship are core themes for the VVD, equal opportunities for the NSC, and autonomy and security for the PVV. These frames also connect well to current issues like the war in Ukraine and energy poverty.
No New Ambitions, Less Regulation
The outline agreement is clear: the forming parties do not want stricter goals:
“We adhere to existing agreements; only if we do not meet the goals, we will create alternative policies. There will be no new national additions to European policy.”
And more specifically:
“(...) no additional national sustainability regulations for construction will be imposed.”
The goals remain unchanged, and this is crucial. More ambition is not needed right now; achieving the current goals is already a huge challenge. The focus must now be on execution and realization. However, proposed regulatory measures, such as mandatory energy label improvements, switching to heat pumps, and establishing emission-free zones in traffic, will be rolled back. The announced increase in the CO2 tax will also be reversed. This is counterproductive and contradicts the understanding that regulation and pricing are necessary. Keeping it voluntary hinders market developments and does not resolve the uncertainty for homeowners and businesses.
Populism and Lack of Vision
Although less so than in other areas of the agreement, the right-wing populist character of the coalition is also evident in their approach to the energy transition. This includes unnecessary priorities, such as favoring housing over wind turbines, and a mention of high collective heating prices recently in the news, despite the previous cabinet already addressing this with legislation. However, essential challenges remain. A major bottleneck in the energy transition is the lack of technical personnel, yet the agreement aims to limit labor migration. There has also been underspending for years due to capacity shortages within the government, and the agreement seeks to reduce the civil service. The populist themes of ‘fewer civil servants’ and ‘fewer foreigners’ negatively impact the energy transition but align with the electorate's sentiment.
Additionally, there is a lack of a clear, substantive, integrated vision for the energy transition. The combination of populism and a lack of a transition vision is particularly evident in the intersection of mobility and transition. The best example is the increase in the maximum speed on highways. Mobility is a critical sector for reducing greenhouse gas emissions and addressing safety, spatial development, particulate matter, and nitrogen. A transition is necessary, but this agreement maintains the status quo. The position on air traffic, hoping for growth with quieter and cleaner planes, is simply naive.
Good Governance: Gap Between Ambition and Reality
The two frames for the energy transition are solid. Not tightening the objectives, considering the long road to achieving the current goals, is not an obstacle at the moment. Rolling back certain measures, along with populism and a lack of vision, does not help but will not cause significant harm either. However, the key factor that could greatly benefit the energy transition, and with which the coalition parties want to distinguish themselves, could in practice become its biggest challenge: good governance.
“Stable policy is important: citizens and businesses need to know where they stand.”
This is the core; this is essential, and if achieved, we will make significant progress. However, it is highly doubtful whether this will succeed. The votes and debates during the formation period, for example, on the net metering scheme and feed-in tariffs, already indicate the opposite. A lack of vision and knowledge, reinforced by populism, makes it likely that the actual policy will be characterized by frequent course changes and uncoordinated actions.
“Politics and governance, despite good intentions, have failed in recent years by not always taking people’s concerns seriously."
However, the current concerns of the people about the energy transition are not necessarily aligned with the actual current and future needs based on facts, nor with the broader societal interest. The energy transition requires stable, forward-looking, and bold policies, along with effective implementation. Good governance in the energy transition is not about catering to the vox populi, yet the outline agreement perhaps does this a bit too much.