ICIS view: Energy policies key in Dutch coalition negotiations

20 March 2017 14:48 Source:ICIS

The future direction of Dutch energy policy will be one of the key negotiating points as the liberal VVD party attempts to put together a coalition following last week’s election.

As ICIS predicted before the election ( see ICIS Power Perspective ), the VVD remained the largest party in the Netherlands, but will require the support of three additional parties to reach the 76 seats required to form a governing coalition.

The VVD plans to work with the progressive D66 party and the Christian-democratic CDA, prime minister Mark Rutte said on Monday.

However, this would still leave the VVD requiring an additional five seats to secure the majority government that the party wants.

Having ruled out going into coalition with the right-wing PVV, which finished second in the election, this leaves four potential options for the VVD: the Socialist party, with 14 seats; GreenLeft, 14 seats; Labour party, nine seats; or the Christian Union, five seats. Rutte expressed no preference, saying that “each party has its advantages and disadvantages”.

However, the least likely options appear to be the Socialist party, which previously said it would not enter a coalition with the VVD, and the Labour Party, which put its failure in the election, losing 29 seats, down to being the minority partner in the previous coalition. As such, it may not want to enter another coalition.

This would leave either the GreenLeft or the Christian Union. The GreenLeft would provide the advantage of a significant governing majority of 85 seats, rather than the very narrow 76 seats provided by the Christian Union.

However, the GreenLeft is more likely to demand that concessions towards cleaner energy policies are provided before agreeing to enter a coalition.

Energy policies

With the Netherlands on course to miss its 2020 renewable energy and greenhouse gas reduction targets, the main negotiating points will be over the level of funding awarded to renewable energy projects and whether or not to close the country’s five remaining coal-fired power plants.

D66, CDA, GreenLeft and the Christian Union all voted in September for a phase-out of coal and in February for an additional offshore wind site by 2023 to be considered.

So whichever parties make-up the coalition, the VVD will be faced with a majority of voices pushing for policies in favour of more renewables spending and the phasing-out of coal plants.

However, if the GreenLeft becomes the fourth member of the coalition, these changes could be implemented more rapidly.

The GreenLeft, D66 and CDA all also pledged in their manifestos to set up a green investment bank to use public money in support of sustainable energy investment, which may become part of the government’s new energy agenda.

Outside chance

Green Party leader Jesse Klaver has said his preference would be for a Christian-progressive government that excluded both the VVD and PVV.

This coalition would result in an even stronger push for renewable-friendly, anti-coal policies. However, this should be seen as a less likely alternative given that it would exclude the two largest parties in the election. matthew.jones@icis.com

By Matthew Jones