In Netherlands the fixed cost for city based heating is paid by the people who make use of it. That seems fair, but practically it means that it’ll be cheaper for people to arrange their own heating system and rely on electric heating. This because the fixed cost is high. However, if everyone switches to using electricity the city based heating would overall be much cheaper solution than relying on electricity. This as currently loads use a gas solution and there’s a huge cost involved to upgrade the electricity network.

The city based heating variable price is connected to the gas price. So even if city based heating per kWh equivalent would be cheaper, people wouldn’t notice or get the advantage.

As a result, city based heating is very unpopular. Planned projects to switch entire neighbourhoods have been cancelled. Again, logical because people were really upset to pay significantly more despite insulating their entire home.

Seems that in Netherlands they’ll ignore the problem and have the country be less cost effective and upgrade the electricity network for significantly more money.

The Dutch Financial Times did a few articles on above in the last 12 months or so.