Equity on the grid

Abstract

To advance the energy transition and prepare for the accompanying increase in electricity demand, the electrical grid of the Netherlands requires rigorous investments for expansion and maintenance. In order to solve and further prevent grid congestion, a lot of projects have to be executed and this demands collaboration of grid operators and local governments. In addition to the technical problems of the transition, there is also a growing part of the population that is suffering from energy poverty and energy injustice which prevents them from benefiting from new innovations, while wealthier households are financially profiting from these. The negative socioeconomic effects are not accounted for in the investment plans of grid operators, even though not addressing these problems will further increase inequality in the population.
In order to research how investments in the electricity grid are related to the socioeconomic status of neighbourhoods and how this affects equality in the province of South-Holland, this thesis is conducted. The study aims to answer the research question: "To what extent can spatial relations between electricity grid infrastructure and socioeconomic characteristics be identified and quantified in the province of South-Holland and what does this relation imply for inequality?"

To answer this question, first a literature study was conducted in order to identify socioeconomic variables related to energy poverty and energy justice to use in the research. Subsequently, data for these selected variables is collected on a neighbourhood level and the electricity infrastructure in the province of South-Holland is mapped. The research focuses on the low and middle voltage grid infrastructure as these grid levels directly influence households and their impact can be assessed on a neighbourhood level.
The collected data was then used in a correlation analysis to discover a possible relationship between the socioeconomic status of a neighbourhood and the amount of low and middle voltage stations located in it. As the electricity demand of wealthier households is higher than the demand of lower income households, it was expected that there would be a positive correlation between prosperity and electricity infrastructure. The found correlations, however, did not result in any definitive conclusions, except for the relation between the amount of inhabitants and the amount of electricity infrastructure, so another analysis was performed that focused more on the spatial correlations. In this hotspot analysis the variables with a strong relation from the correlation analysis were used in a clustering research. This resulted in indications being found that linked areas of socioeconomic prosperity to more investments in electricity infrastructure, as was assumed. This implicates that there is an unbalanced distribution of costs and benefits on the grid as everyone pays the same for the investments, but wealthier neighbourhoods profit more.

In order to learn how this relation came to be and how it affects equality, experts on the topic were interviewed. In total five interviews were conducted with people from main stakeholders in the system, namely: grid operators, municipalities and researchers on energy justice. The interviewees were asked about their thoughts on the results of the analyses, the developments of the electricity grid, its effect on equality and the role of the province of South-Holland in the system. From these interviews it was concluded that the indicated unbalanced distribution of electricity grid investments among different socioeconomic groups in the population is not necessarily a problem for equality on the short term, although it might provide difficulties in the future. The investments follow demand and thus it is a logical consequence that neighbourhoods with a higher electricity usage require more electricity infrastructure.
The problem in the system is that there are socioeconomic groups who have no access to the energy transition and can therefore not benefit from the developments, while others are enriched by it. This unequal balance of costs and benefits causes inequality to grow in the future, so governments will have to ensure lower income households have access to energy transition innovations in order to secure a balanced and sustainable future.