The Dutch industrial sector stands at a critical crossroads. Facing rising energy costs, inadequate infrastructure, and strict environmental regulations, industries in the Netherlands are increasingly struggling to compete with their European and global counterparts. The director of Chemelot, Koos van Haasteren, has sounded the alarm: if swift action is not taken, entire industries could collapse or relocate. This raises a pressing question: is the Netherlands on the verge of an industrial exodus?

A Costly Business Environment

Compared to neighboring countries like Germany and Belgium, operating costs in the Netherlands have become disproportionately high. Energy prices are a significant factor. Energy-intensive industries, such as chemicals, metals, and manufacturing, are particularly vulnerable. For these sectors, competitive energy prices are not just an advantage—they are a lifeline. Yet, Dutch companies face some of the highest energy tariffs in Europe, compounded by taxes and levies intended to drive the energy transition.

A Strained Energy Network

Another bottleneck is the capacity of the Dutch energy grid. As industries seek to transition to greener energy sources, they are encountering significant obstacles in connecting to the grid. Delays in network expansion are creating a catch-22: industries are expected to decarbonize, but they lack the infrastructure to support sustainable operations. This issue affects not only existing businesses but also potential investors who are hesitant to commit to a market with such systemic limitations.

The Permit Paradox

The Netherlands’ stringent nitrogen regulations have further compounded the challenges. Acquiring permits for new projects or expansions has become a Herculean task, especially for industries located near nitrogen-sensitive (Natura2000, N2k) areas. While environmental protection is crucial, the rigid application of these rules often results in delays or outright denials of projects that could otherwise drive innovation and sustainability. This regulatory environment is increasingly seen as a deterrent rather than an enabler of progress.

Global Competition

The Dutch industrial sector is not just competing within Europe; it is also up against major global players like China, the United States, and Russia. These countries offer a combination of lower energy costs, less stringent regulations, and in some cases, direct subsidies to attract industrial investment. As a result, Dutch companies are finding it harder to justify staying in a market where the playing field feels increasingly tilted against them.

Uncertainty in Climate Policy

While the drive toward climate neutrality is both necessary and urgent, the lack of a stable, long-term vision in Dutch climate policy creates uncertainty for businesses. Companies are expected to make massive investments in sustainable technologies, yet the policy framework often shifts, undermining confidence. Without a clear roadmap, many industrial players are left hesitant to commit to the Dutch market.

What’s at Stake?

If these challenges remain unaddressed, the consequences could be severe:

• Loss of Jobs: Industrial sectors employ hundreds of thousands of people. A wave of closures or relocations would lead to significant job losses, both directly and in supporting industries.
• Economic Decline: A shrinking industrial base would weaken the Dutch economy, reducing GDP and tax revenues.
• Loss of Innovation: Industries play a crucial role in driving technological and sustainable innovation. Their departure would leave the Netherlands dependent on imports and external technologies.
• Energy Transition Delays: Paradoxically, losing industries would also slow down the country’s transition to a green economy, as fewer resources and innovations would be available to meet climate goals.

The Path Forward: Key Actions Needed

To avoid an industrial exodus, the Netherlands must act decisively. Here are five key measures to safeguard the future of Dutch industry:

1. Reduce Energy Costs: Introduce subsidies or tax breaks for industries transitioning to green energy and negotiate lower energy prices for critical sectors.
2. Expand Energy Infrastructure: Prioritize investments in the electricity grid and renewable energy projects to meet industrial demand and support decarbonization.
3. Streamline Permitting Processes: Reform the permitting system to ensure that sustainable projects receive expedited approval while maintaining environmental safeguards.
4. Level the Playing Field: Advocate for a more uniform regulatory framework within the EU to ensure that Dutch industries are not disproportionately disadvantaged.
5. Provide Long-Term Policy Certainty: Develop a stable and predictable climate policy that gives industries the confidence to invest in sustainable innovations.

Warning, time for Action is now.

The challenges facing Dutch industry are not insurmountable, but they require immediate and coordinated action. As Koos van Haasteren has warned, the Netherlands risks losing its industrial backbone if these issues are not addressed.

The country must strike a balance between environmental responsibility and economic competitiveness. Failure to do so will not only result in the loss of jobs and investments but also hinder the very energy transition it seeks to achieve.

The time for action is now. Without bold measures, the Netherlands may soon find itself looking back at what was once a thriving industrial powerhouse.