Rural Dutch households hit hardest by high energy prices

High fuel and energy prices are placing a particularly heavy burden on households in more remote rural areas of the Netherlands. New research by Utrecht University and TNO, published last week in the economics policy journal ESB, shows that households in regions such as North-East Groningen and Zeeuws-Vlaanderen spend a significantly larger share of their disposable income on car fuel, electricity and home heating.

A heavier burden for rural households

The war in the Middle East has contributed to a sharp rise in fuel prices for the second time in five years. While these costs affect households across the Netherlands, the new study shows that the impact is not evenly distributed. Households in more peripheral regions are especially vulnerable because they often depend heavily on cars, live in detached homes that lose more heat, and have relatively low incomes.

Regional differences in energy spending

For the study, the researchers analysed data from 6.2 million households. They found a clear regional pattern: rural households spent the largest share of their disposable income on energy for their homes and transport. Even when lower housing costs in rural areas were taken into account, these households remained more vulnerable to high energy costs. At the same time, limited disposable incomes leaves little room to invest in home insulation, heat pumps or electric vehicles. “This creates a risk that certain groups of households in the Dutch periphery will fall behind in the energy transition,” says lead author Chris ten Dam, who carried out the study as part of her PhD research at Utrecht University's Copernicus Institute of Sustainable Development.

Our findings show that the affordability of the energy transition is not only a question of income, but also of geography.

Smart policy support needed

Targeted support could help these households pay their energy bills or invest in more sustainable technologies. However, the researchers emphasise that additional smart policy is needed. One example is the new income-dependent scheme that supports people in trading in fossil-fuel cars. Another promising option is a social leasing programme for small electric cars for low-income households, inspired by the French model.

Investing in homes and regions

The researchers also point to the importance of regional investment in housing renovation. Including more rural areas in the National Programme for Liveability and Safety could help improve the energy efficiency of homes in regions where households are currently most at risk.

“Our findings show that the affordability of the energy transition is not only a question of income, but also of geography,” says Ten Dam. Without targeted measures, households in more remote rural areas may face a double disadvantage: higher energy dependence and fewer resources to reduce it.