Opinion Eelko Huizingh: Clearing the way for gas-free construction

Some changes seem to drag on forever, and then suddenly gather speed once they pass a tipping point. Gas-free construction is a prime example. Until recently, there were endless discussions about abolishing the statutory obligation to fit every new home with a gas connection. But then suddenly the government announced that from 1 July, all new homes must be built without a gas connection. It was a huge shock to the Dutch construction industry and prospective house-buyers. People called it a panic move and demanded compensation. What does this say about ‘our’ builders? And ‘our’ house-buyers?

We have known for decades that the Earth's supplies of fossil fuels are almost exhausted. The Paris Climate Agreement, with its ambitious energy goals which the Netherlands endorsed, may have only been signed in 2015 but it was preceded by four long years of negotiations. So it should not have come as a surprise that something about our energy supplies had to change.

Estimated lifespan 120 years

Another two statistics: the estimated lifespan of a Dutch house is 120 years. Before the decision to stop extracting gas in Groningen by 2030 at the latest, it was thought that the supply of natural gas would run out in 2034. In other words: homes built in 2018 could only be heated with Dutch gas for 10-15 years, and not for the following hundred years. So is it strange to stop fitting gas connections? Or is it stranger to keep building and buying homes with a gas connection?

Responses

How did people respond to the Cabinet’s decision? Neprom (project developer) and Bouwend Nederland (the Dutch Construction and Infrastructure Federation) warned that the obligation to stop providing gas would lead to problems. The Dutch Association of (Prospective) Home-owners (Vereniging Eigen Huis; VEH), which represents the interests of people buying houses, supports the idea of ‘forcing’ the transition to gas-free construction, but not at the expense of buyers. VEH also considers a start date of 1 July too soon. Bouwend Nederland would like to see a temporary voluntary disclosure scheme to encourage ongoing projects to change course and deliver homes without gas. Financed by the government obviously.

Are these reactions a surprise? No, for two reasons. First, changing existing plans always comes at a price. No matter how outdated the plans were, you can understand why builders and buyers want the government to foot the bill. It's always better than having to pay yourself. Secondly, there are always trailblazers and laggers in any technological innovation. Trailblazers are innovative companies, often relatively small, with less clout but willing to take a risk. Laggers are companies that have earned huge profits using outmoded working methods and are keen to keep it that way. Innovation means change and if you are powerful, any change is a potential threat to your profitable status quo. So it’s only logical that these builders will kick up a fuss.

Put to shame

The fact that so many contractors have houses and other building projects with gas connections ‘in the pipeline’ is telling. The construction industry, which isn't known for its innovative character, is being put to shame. And that's a pity because there are also contractors who haven't spent the last few years hiding under a stone.

Gas-free construction is only innovative to the major mass-building companies; contractors that specialize in project construction and baulk if buyers want to move a plug point one metre to the left. Contractors that have been building houses with gas-powered heating since the mid-1960s. If you've been performing the same trick for fifty years, it can be quite a shock if someone suddenly asks you to jump through a different hoop. But is the technology new? Technology for energy-neutral building has been around for quite some time, so in 2018, no-one can pretend that gas-free construction is an innovation. Except builders who have chosen to ignore the wind of change.

‘Voluntary disclosure scheme’

The strange thing is that Bouwend Nederland has more or less admitted this by talking about a ‘voluntary disclosure scheme’. What is a voluntary disclosure scheme actually? The definition I found on the internet is a scheme that says that if people change their behaviour when they realize they've done something wrong, they won't be punished. So you've done something wrong and deserve to be punished, but if you quickly confess and promise to change your ways you can avoid punishment.

Creative destruction

So what's next? First, should the government pay compensation? The main problem with this Cabinet decision is that it was made in 2018, while it could (and probably should) have been made much earlier. Does this mean people are entitled to compensation? It could; after all, the government changed the rules after the game had started and that's not fair. But there's another side to this story: some builders (and house buyers) have stuck their necks out in recent years and invested in innovation. They embarked on a risky and often expensive process, learning to design and build houses with other types of heating, while other contractors continued to make big money with ‘business as usual’. So should we really compensate (or pay) these contractors for their lack of courage? This phenomenon is called creative destruction. Let's clear the way for the contractors who show innovative spirit.

Secondly, let’s try to look forwards as well as backwards. Contrary to what builders and house-buyers would have us believe, gas-free homes are not innovative. Been there, done that. Gas-free is simply another step towards energy-neutral. ‘Zero on the meter’ must become the norm as soon as possible. If builders and house-buyers continue to bury their heads in the sand, we’ll face the same discussion in another few years. Most of the houses built this year will outlive us anyway.

Dr Eelko Huizingh is Associate Professor of Innovation Management, director of the Vinci expertise centre at the University of Groningen and author of the book ‘Innovatiemanagement’.

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