The recent publication in Vastgoed Fiscaal & Civiel, authored by Boris Andriessen of our Real Estate & Infrastructure practice, highlights an often-overlooked consequence of Dutch grid congestion: the potential loss of contracted transport capacity for leased commercial properties. As grid capacity becomes increasingly scarce, landlords face the risk of losing valuable transport rights through tenant actions, regulatory interventions, or the termination of electricity connection agreements. Existing lease legislation and standard “ROZ provisions” provide only limited protection.
Here are 3 key takeaways from his article:
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#1 Contracted grid capacity has become a valuable real estate asset
In many parts of the Netherlands, obtaining additional electricity capacity can take years due to widespread grid congestion. As a result, existing contracted transport capacity is no longer merely a utility matter but increasingly a factor affecting the usability, marketability and value of commercial property. A reduction of available capacity may significantly limit future operational possibilities for tenants and affect the attractiveness of a property to prospective occupiers.
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#2 Landlords can lose capacity without actively causing it
Where the connection and transport agreement is registered in the tenant’s name, the tenant may be able to request a reduction of contracted transport capacity to lower network costs. In addition, network operators may reclaim underutilised capacity under the “Use It or Lose It” regime when specific statutory conditions are met. Finally, a tenant may terminate the connection and transport agreement at the end of the lease, potentially requiring a new application that could be subject to lengthy waiting lists. In each of these scenarios, restoring lost capacity may prove difficult and time-consuming.
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#3 Standard lease documentation offers insufficient protection
According to the article, neither the standard “ROZ” lease provisions, nor the general duty of good tenancy, provide sufficiently targeted safeguards against the loss of transport capacity. Landlords should therefore consider incorporating specific contractual protections, including:
- a prohibition on unilateral reductions of contracted transport capacity;
- obligations to sufficiently utilise allocated capacity;
- information and consent requirements regarding communication with the network operator; and
- mandatory transfer of the ATO at the end of the lease term.
Such measures can help preserve valuable grid capacity and protect the long-term leasability of commercial assets.
How we can help
As grid congestion continues to reshape the Dutch real estate market, contracted transport capacity is becoming an increasingly important component of both asset value and lease management. Landlords, investors and advisers should assess whether existing lease agreements provide adequate protection against the loss of grid capacity and whether additional contractual safeguards are needed. Failing to address these risks may result in reduced flexibility, project delays and diminished property value.
Our Real Estate & Infrastructure team advises clients on the legal and practical implications of grid congestion, including the allocation and protection of contracted transport capacity in lease arrangements. We help identify potential vulnerabilities, negotiate appropriate contractual safeguards and structure lease documentation in a way that protects long-term operational and commercial interests.
If you would like to discuss how these developments may affect your assets or lease arrangements, please do not hesitate to get in touch.
Read the full article here.
