Big differences in municipalities' energy support; More people opt for variable rates

Dutch municipalities offer various forms of support to residents struggling with increasing energy bills and inflation. But the difference between them is getting so big that experts are concerned about inequality, Trouw reports. According to the newspaper AD, tens of thousands of Netherlands residents are switching to variable rates in their energy contracts in an attempt to get the bill lower.

Municipal support range from free public transport to help with insulation. Breda abolished the personal contribution for special assistance. Enschede set up an emergency fund for people who run into financial problems due to the rising energy costs. In Amsterdam, low-income households can exchange their old washing machine or refrigerator for a new, energy-efficient ones with the municipality’s help.

While the support is excellent for the people who need it, experts are worried about the inequality they create between municipalities, according to Trouw. Because some cities offer more help than others.

That is easily visible with the 1,300 euros energy allowance the Cabinet made available for low-income households. According to the government measure, that is households with an income of up to 120 percent of the social minimum. Municipalities are responsible for paying out this allowance.

But in Ede, for example, households that earn up to 130 percent of the social minimum can qualify for the allowance. Rotterdam set the limit at 140 percent of the social minimum. Utrecht temporarily increased its definition of “low-income” from 125 to 150 percent of the social minimum. Most municipalities don’t pay out the energy allowance to students. But some, including Hilversum and Delft, do.

The National Institute for Budget Information (Nibud) is increasingly concerned about the differences between municipalities. “Our director called it a kind of reverse postcode lottery,” a spokesperson said to Trouw. “Where you live determines how much you get.”

Professor Geerten Boogaard of local authorities at Leiden University and Nadja Jungmann of debt problems at the University of Amsterdam also raised concerns. Both stressed that local variation should be possible, but not to this extent.

According to the newspaper AD, another way Netherlands residents are looking to cut their energy bills is to switch to contracts that vary rates on an hourly basis.

Energy companies' variable contracts usually charge one rate, fixed for three months. But some offer dynamic contracts with hourly prices announced a day in advance. Consumers can then try to time when they use their energy-intensive appliances for the cheapest time of the day.

“Since the summer, we have gained tens of thousands of customers. Now thousands of people sign up every week,” Perry Lievaart of the ANWB, which started offering dynamic contracts over a year ago, said to the newspaper.

The consumers’ association Consumentenbond can see why this method is gaining popularity now that energy prices are so high. But it warned consumers that the lowest rates on dynamic contracts could still be higher than the regular contract prices.