A panel data analysis of the impact of energy democracy on renewable energy adoption in the Netherlands

Energy communities may play a critical part in the government's goal of transitioning to renewable energy. The Netherlands is taking a long time to integrate localized energy transition strategies. Additionally, the country's reliance on non-renewable energy remains significant. In order to fasten the Dutch transition to renewables, it is crucial to figure out what factors influence the role of community-based participation in the adoption of decentralized renewable energy. Thus, this thesis investigated the adoption of renewable energy and the role of energy democracy in The Netherlands’s energy transition. In particular, the goal of the research is to investigate quantitatively the explanatory power of the socio-economic conditions and institutional factors in the adoption of renewable energy with a focus on the role of energy democracy in terms of community renewable energy systems. With this aim, the research started as a study of the energy democracy in The Netherlands; more insight was achieved into the drivers and barriers in adopting renewable energy and the role of socio-economic and institutional factors. This research has been designed as desk research and longitudinal design in the form of the panel study. The key methods used were collecting secondary data from official statistics. Data was analysed using a fixed-effects model and the findings further supplemented by collecting primary data with semi-structured interviews. The differences across provinces and regions have been explained with the selected predictors and control variables. The main findings where that socio-economic condition of households measured with the share of income spent on energy is negatively associated with the role of energy democracy. Furthermore, the selected institutional factor, the financial incentive for stimulating the adoption of renewable energy SDE+ (incentive scheme for sustainable energy production) has demonstrated a significant positive impact in The Netherlands energy democracy and energy transition. This finding was further supported with the expert’s opinions from the interviews. From the analysis we show and conclude that socio-economic conditions and institutional factors such as financial incentives are associated with the innovation-decision process which is an important element behind the participation in the energy transition in The Netherlands. There appears to be an economic gap that differentiates early adopters from late adopters, although this only explains partly according to the presented model.