The Dutch Energy Act: what has been changed now the Electricity Act 1998 and the Gas Act disappeared

The Energiewet (Energy Act) replaced the Electricity Act 1998 and the Gas Act. It is the largest overhaul of Dutch energy law in more than twenty-five years. For network operators, energy suppliers, large consumers and operators of private networks a great deal changes: from the system of connection and transport to the rules on data, energy sharing and the position of the ACM. This article sets out the main changes and what they mean in practice.

Why a new act?

The Electricity Act 1998 and the Gas Act were written for an energy market that was fundamentally different from today’s. Decentralised generation, grid congestion, electrification of industry, energy communities and the digitalisation of the energy system fitted the old statutory framework increasingly badly. The Netherlands also had to implement the European Clean Energy Package, including the Electricity Directive and the Electricity Regulation. The Energy Act brings the rules for electricity and gas together in a single act and modernises the framework for the energy transition. It enters into force in phases, and part of the obligations is worked out further in secondary legislation, including the Energiebesluit and the Energieregeling.

One act for electricity and gas

The most visible change is structural. Where electricity and gas each had their own act, the Energy Act brings both within one coherent system. Definitions have been harmonised and the structure has been rebuilt around the roles in the energy system: system operators, suppliers, aggregators, active customers and energy communities. Anyone used to working with article numbers from the old acts will have to find their way again, because virtually no provision has been carried over unchanged.

Connection and transport: new rules in a time of congestion

For large consumers and project developers the chapter on connection and transport matters most. The Energy Act codifies and refines the rules that have developed in recent years under the pressure of grid congestion. In principle the network operator remains obliged to connect and to offer transport, but the act leaves more room for alternatives such as flexible contract forms and congestion management. We wrote earlier about a grid connection refused by a network operator and about the rights, obligations and remedies around congestion management. The Energy Act builds on that practice and gives operator and customer a clearer statutory framework, although much still depends on the codes and on decision-making by the ACM.

New roles: active customers, energy communities and aggregators

For the first time the act gives a full statutory position to parties that were barely regulated under the old system. Active customers may generate, store, sell and take part in flexibility markets. Energy communities obtain a statutory framework for collective generation and for sharing energy between members. Aggregators may bundle supply and demand from several customers and offer that on the market. For businesses this opens up new revenue models, but it also raises new legal questions about contracts, liability and the relationship with the supplier and the network operator.

Data and digitalisation

An entirely new part of the act is the regime for data exchange. Metering data and other system data are seen as the lubricant of the energy system. The act settles who has access to which data, on what conditions market parties may use data, and how the privacy of customers is protected. For energy companies and service providers offering data-driven products this chapter has direct commercial significance.

Closed distribution systems and private networks

For operators of private networks and closed distribution systems the statutory foundation changes as well. The regime for closed distribution systems returns in the Energy Act, but the criteria, the procedure and the way general obligations apply have changed in places. We discuss this in our article on closed distribution systems under the Energy Act.

Supervision and enforcement by the ACM

The ACM remains the central regulator and dispute resolution body in energy law, but its toolkit is extended and streamlined on a number of points. The act rearranges the powers around code decisions, exemptions, tariff regulation and dispute resolution. Grounds and time limits shift, so existing procedural routes should be checked case by case.

Transitional law: old rights, new act

An overhaul of this size stands or falls with its transitional law. Existing connection and transport agreements, licences, exemptions and code decisions are in principle continued under the new act, but not always unchanged. For pending proceedings and existing contracts it is important to assess per case which regime applies. It is precisely in this transitional phase that disputes arise about which rights from the old system carry over to the new one.

What does this mean for your organisation?

The Energy Act is not a cosmetic exercise. Contracts referring to articles of the Electricity Act 1998 or the Gas Act deserve revision. Exemptions and licences should be checked for their status under the new regime. New roles and instruments, from energy sharing to flexibility services, offer opportunities that call for a well-considered legal set-up. Our energy law lawyers advise network operators, operators of private networks, producers and large consumers on the consequences of the Energy Act for their position. Please contact us for a quick scan of your contracts and permits under the new law.