Introduction

Starting 1 July 2019, the scope of the Dutch Heating Supply Act (Warmtewet) (the Act) will be revised. The revision will have significant consequences for landlords of residential units or business space (including office and retail) who supply heat to their tenants. As of July 1, landlords will be exempted from the Act.[1] This blog post explains the current obligations of landlords pursuant to the Act and the consequences of the Revised Act for landlords.

Current Heating Supply Act

Currently, landlords who lease out at least 25 residential units or landlords of business space who supply heat through a connection to a maximum of 100 kilowatts to their tenants qualify as “heat suppliers” under the Act. As a result, they are subject to the Act. The Act imposes various obligations on heat suppliers, for example:

  • executing a heat supply agreement with tenants (with certain mandatory elements);
  • charging no more than the statutory maximum prices and other reasonable costs to tenants;
  • providing a full and sufficiently specified invoice at least once a year;
  • notifying the Dutch competition authority (Netherlands Authority for Consumers & Markets) (Autoriteit Consument & Markt); and
  • under certain circumstances, being subject to a permit from the Dutch competition authority.

These obligations impose a significant administrative burden on suppliers. Most of these obligations will no longer apply for landlords under the Revised Act.

Consequences of the Revised Act

Pursuant to the Revised Act, “landlords” owning residential or business space for lease purposes will no longer qualify as heat suppliers and will be exempted from (most of) the obligations imposed by the Act. The requirements concerning the method of measurement of heat consumption pursuant to articles 8 and 8a of the Act will, however, continue to apply for such landlords. Pursuant to these articles, heat suppliers must, inter alia, charge costs for heating supply based on an individual heat meter or based on a cost distribution system (kostenverdeelsystematiek) which clearly sets out the costs for all tenants.

Under the Revised Act, the rules regarding service costs under tenancy law will be applicable to landlords of residential space that supply heat to their tenants (e.g., pursuant to the Dutch Civil Code or Service Costs Decree (Besluit servicekosten)). Contrary to rules concerning residential space, no specific statutory rules on service costs in connection with the lease of business space are in place. This allows parties to arrange the distribution of such costs in the lease agreement (in accordance with articles 8 and 8a of the Act).

Starting 1 July 2019, landlords are no longer obliged to execute heat supply agreements with their tenants. Previously executed supply agreements declaring the Act applicable, however, remain in force. Landlords could, in consultation with each tenant, amend those agreements in such a way that the Act is no longer applicable, or try to terminate the agreement on other grounds.

[1] Other provisions of the revision will enter into effect on 1 January 2020. In this post we only explain the exemption of landlords starting 1 July 2019.

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