Dutch gov't can't guarantee gas supply to businesses this winter: report

The Dutch Cabinet cannot currently guarantee the security of gas supply for companies in the Netherlands this winter, experts said to Nieuwsuur. The government is leaving the gas supply entirely to the commercial market. And the current high gas prices make it unattractive for the market to purchase gas. Household supply will not be affected, according to the program.

The Netherlands has been warned several times that it is making itself vulnerable with this market-based policy, according to the program. But the Ministry has never changed it. The Mijnraad, an independent advisory body of the government, warned last year that security of supply should either be "more empathetically" involved in gas policy or the gas supply in Groningen "cannot be irreversibly closed."

In 2018, the semi-government company GasTerra had an independent report drawn up on the Dutch gas policy. The researchers raised the "urgent" question of whether the government can guarantee sufficient gas in the coming years. The researchers advised against relying on the "spot market" for large quantities of gas. The energy companies the government depends on buy their gas almost entirely on this market.

Unlike other European countries like France and Italy, the Netherlands does not have a reserve stock of gas or agreements with gas companies on minimum reserves they have to keep. And that while 44 percent of the Dutch energy supply still comes from gas. The Netherlands also has very few long-term gas contracts, according to Nieuwsuur.

"The current government still assumes a fairly simple vision of market forces. That competition produces the lowest prices and that there is a security of supply," Aad Correlje, an energy specialist at TU Delft, said to the program. "Only, that does not apply to all markets, and certainly not for the gas market."

The Netherlands relinquished too much control, according to the VVD. There is no longer such a thing as an "open gas market," the coalition party said. "As liberals, we naturally believe in market forces. But only if there is a free market," VVD parliamentarian Silvio Erkens said to Nieuwsuur. "And in the case of the gas market, there is no free market. Geopolitical and economic interests are completely intertwined."

CDA parliamentarian Henri Bontenbal is also critical. "The security of supply has been left too much to the market, with the idea that the market will solve that on its own. And I think we are now seeing that is not the case."

The parties want clarity from the Cabinet about scenarios it has ready for shutting down companies if the gas stocks run out this winter. It's too late to intervene for this winter, Erkens said. "That's just the honest story. We are going into the winter with the gas supplies and contracts we have now. For households that seems to be sufficient, for the industry it is uncertain."

For the longer term, the VVD and CDA want the Cabinet to increase its gas stocks, think about long-term contracts, and ensure the entire energy system is in order. "We should also look at keeping gas production stable in the North Sea and see whether we can reduce the dependence in some places," Erkens said.