Unlocking the Carbon lock-in in the Netherlands: A case study on the challenges and conditions for phasing out fossil fuels.
To limit global temperature rise, greenhouse gas (GHG) emissions should be massively reduced. However, many countries are locked-into fossil fuel use. This means that market systems and policies will give an advantage to fossil fuel technologies and disadvantage alternatives, perpetuating fossil fuel usage. Hardly any research has applied the carbon lock-in to a specific case. This thesis thus explores the challenges that European Union (EU) Member State (MS) the Netherlands faces, and the conditions under which it would likely be able to phase out fossil fuels. Using the theories on carbon lock-in and transitions, I examined 28 policy documents and conducted 5 interviews. The results of the analysis shows that, over the years, Dutch climate and energy policies enabled a continuation of the carbon lock-in, because (a) the policies focused on energy security, (b) the potential income generated by using gas, and (c) poor design that counteracted and obstructed other policies in the long-term. To generate emission reductions, the Dutch government mainly provided (i) subsidies for renewable energy, and (ii) tax schemes that should influence energy consumption. These measures were chosen as they were cost-effective, served social ends, and helped maintain the competitiveness of the Dutch economy by not being ahead of European or international policy. In doing so the use of fossil fuels in the Netherlands since 1990 went up until 2010, after which it did not fall below the 1990 level until 2019. All in all, the main challenges to phase out fossil fuels are the availability of fossil fuels and its structurally low prices, resulting in a strong institutional lock-in that enhances the perceived imortance of competitiveness for the economy and energy security in policy decisions. As energy-intensive sectors and households benefited from the availability of cheap energy, and the Dutch State was able to derive income from its presence and use. Conditions under which the Netherlands is likely to phase out are continuously and gradually rising fossil fuel prices and higher internationally legally binding targets, as both push the Netherlands to reduce its emissions.