Enexis regularly encounters dilemmas, both in our daily operations and in the development of new policies. We believe it is important to share some of the dilemmas we faced last year. This enables us to provide our stakeholders with insight into the considerations that shaped our decisions in 2024.
Wait for heat grid legislation or continue preparations?
Enexis has a vision for the sustainable energy system of the future. We see opportunities for sustainable molecules and heat grids. We are working hard to make our vision a reality, but we also depend on others. This can get in the way of a forward-looking approach. Take district heating grids: construction has barely got off the ground. One of the main reasons for this delay is the postponed introduction of the Collective Heat Supply Act (Wet collectieve warmtevoorziening, Wcw). This new law is meant to replace the existing Heat Act, facilitating the development of new collective heat grids and driving the energy transition forward. The rapid growth of district heating grids would help to relieve congestion on the electricity grid and reduce the need for investments in these networks. However, as long as it remains unclear if and when the Wcw will take effect, the market is at a standstill, and no new district heating grids are moving forward. While Enexis can continue its preparations, the decision to delay hinders acceleration when we should be scaling up. As a result of this delay, more and more individual heating solutions will be installed in neighbourhoods where a collective heating grid would be the better and more cost-effective option. This, in turn, increases the burden on the already strained electricity grid. Therefore, we call for clarity on the Wcw as soon as possible so we can take decisive steps towards a successful heat transition.
Push assets further or expand the network?
We want to free up space on the grid to connect more people and businesses. This is a significant challenge, which is why, in the short term, Enexis is deliberately taking on more risk on the HV and MV grids without compromising safety. We are pushing our assets harder. This may lead to more outages. We also anticipate more outages on the LV network due to the increasing use of heat pumps, charging stations and solar panels. As a result, our engineers are spending more time than before fixing these outages – time that could otherwise be spent to expand the grid. This presents us with a dilemma: do we commit to expanding our network? Or do we push our assets further to help as many customers as possible now, at the risk of more outages and the need for additional repair efforts?
In taking this approach, we are also making concessions to the reliability of the electricity grid. Enexis is doing this in a controlled, cautious and gradual way. The high reliability of our grid remains a core business value. However, it presents a dilemma: how much reliability are we willing to concede, and how many additional outages are acceptable – also from a social point of view?
Expand the grid efficiently or keep it visually appealing?
Expanding the electricity grid is one of the major challenges facing Dutch society. This will become increasingly visible in public spaces, as up to 54,000 new transformer houses will be built across the Netherlands in the coming years. We understand that residents may not want a transformer house near their backyard, playground or parking area. At the same time, many people want solar panels, charging points and induction cooking. To find an appropriate solution to this dilemma, Enexis is in dialogue with residents. A common request we hear is for transformer houses to blend into their surroundings and contribute positively to the local environment. To save costs and time, Enexis prefers to standardise the design of transformer houses. However, in consultation with the municipalities, residents have the option of making these houses more visually appealing.
Transparency: is it really possible?
Enexis wants to communicate transparently with its customers. We want high-volume and low-volume consumers waiting for a new connection or an upgrade to their meter box to know where they stand. We use waiting lists to indicate how long it will be before their turn. Customers can then see whether they will have to wait another two or five years, for example. However, these estimates are not always precise. It is not easy to look far ahead, and we often depend on external factors. Examples include TenneT’s planning for the expansion of the high-voltage grid, the availability of mechanics and equipment, and the timely approval of permits. This raises an important question: to what extent do customers know where they stand? In an age where people can track their online orders in real time, customers expect commitments to be upheld. Yet, depending on developments, timelines can shift forward or backward. Social prioritisation also has an impact here: customers who are not prioritised may experience increased uncertainty, in line with ACM guidelines.
Affordable tariffs or large investments?
Enexis wants to keep energy affordable and accessible for everyone. Since the energy crisis two years ago, energy prices – including connection fees and transmission costs for gas and electricity – have been under increasing scrutiny. At the same time, the energy transition requires billions of euros in investment, and Enexis has to expand its network considerably. So much so that more money is going out every day than coming in – an average of €1.5 million a day in 2024. As a result, we need to borrow more money, but we cannot continue indefinitely. We must maintain a strong credit rating to get the best financing terms. To achieve this, we are improving our efficiency and productivity, promoting socially optimal decisions to avoid unnecessary investments, such as managing demand for transmission capacity, and strengthening our capital base with the constructive support of our shareholders. We are also in discussion with ACM about establishing an appropriate compensation and tariff system for the use of the energy network.